In our business, a parking shortage is good thing - a very good thing. That dirt lot that you thought was worthless 10 years ago suddenly is the talk of the block. This recent article reiterates that finding a place to park is not only going to get harder, but when the city is adding incentives NOT to include parking for a new development, you can bet parking rates are going up too.
Can’t Park? Blame a Condo
By MARC SANTORA NY TIMES
Ever since the car muscled out the horse and garages supplanted stables, New York City has had a conflicted relationship with the automobile. In recent years, the car has been on the losing side. Whether it is the addition of bike lines or pedestrian plazas, a push for congestion pricing or rising tolls, the once-exalted automobile is under siege.
In Manhattan the car faces yet another threat, as parking lots and garages are being snapped up to make way for all sorts of development, especially luxury condominiums. In most cases, the lost public spaces are not replaced, because zoning rules discourage developers from adding parking to new residential buildings.
The spaces that do get built are likely to be in luxury condominiums — and to go to the highest bidder.
But many people still keep cars in Manhattan, and they are left to mourn a favorite parking lot suddenly surrounded by a construction fence, to swallow hard when the cost of monthly parking goes up again, or to engage in an exasperating hunt for a spot at the curb.
Matthew Smith, the president of Smith Affiliated, a money management company, long ago abandoned hope of finding affordable parking near his apartment on 74th Street between Central Park West and Columbus Avenue.
Parking in an iffy spot and hoping the parking enforcement officer calls in sick is not a realistic option. The rise in fines — $65 a pop in most cases — has made it not worth the risk.
“You get a few tickets, and you are paying what you would in a lot,” he said.
For several years, Mr. Smith parked in a lot on 57th Street near the West Side Highway. But then the price began to rise.
With all the new development sprouting up on the West Side, he was able to find a garage at 64th Street and Riverside Boulevard with a reasonable monthly rate of $209.
“Near my apartment there is no way you are ever going to get something south of $500 a month,” Mr. Smith said. Since he uses his car recreationally, he said, sacrificing a little convenience is worth the savings.
The Department of City Planning recently completed its most ambitious study of parking in Manhattan in three decades. The report found that the way cars are used in the city has changed since the early 1980s, when the Clean Air Act’s stricter codes limited the number of new parking lots. Developers were no longer required to provide parking in new developments, and special permission was needed to build large garages.
When the rules went into effect, 85 percent of off-street parking was taken by commuters. Now, depending on the neighborhood, up to 70 percent of those spaces are used by residents.
Over the last three decades, the number of off-street parking spots in Manhattan has fallen by one-fifth — to 102,000 from 127,000, according to the city study.
In the last six years alone, according to data compiled by Property Shark, 92 parking lots or garages have been sold and redeveloped. From the Avenue of the Americas, where a garage fell for a hotel, the Eventi, with rental apartments on top; to Varick Street, site of a condo-to-be, the humble lot has seen better days.
The city plans to convene a series of public meetings in coming weeks to consider the state of parking in Manhattan and Brooklyn. Officials say they are exploring allowing developers to create larger parking lots in Manhattan neighborhoods that rely on commuters, like the theater district or areas around hospitals.
Meanwhile, developers are using the cash they have built up after several slow years of construction to buy property while they wait for the right time to build.
The remaining stand-alone parking lots and garages are prime targets. In January, for instance, the Extell Development Company spent $39 million for two parking lots, one at 135 East 47th Street and the other at 332 West 44th Street. Extell would not say what its plans were for the lots.
The scarcity of parking has made it a must-have for wealthy apartment buyers, who view a space much as they do a fireplace or a walk-in closet. A spot can cost well over $200,000, or, if rented, more than $1,000 a month.
“It always comes up with luxury buyers,” said Cindy Bernat, an associate broker at the Corcoran Group.
But even when a buyer has millions of dollars to spend, a spot can be hard to come by. Right now, 109 condos priced over $10 million are on the market, according to Corcoran. Of those, only 66 are in buildings that have garages. And of the 209 condos priced from $5 million to $10 million, only 112 have garages.
“It is one of the compromises that buyers at this price range may have to make,” Ms. Bernat said.
Louis V. Greco Jr., the manager of the development firm SDS Procida, said that demand was high for parking at its projects, but that adding parking to a new development only marginally increased profits.
His firm recently completed work on the Dillon, at 425 West 53rd Street, replacing a 33,000-square-foot parking lot with a seven-story glass building housing 83 condos and rental apartments, as well as a collection of three-story town houses. Since the opening last year, the starting price for one-bedrooms has been in the mid-$700,000 range and up to $4.1 million for a town house.
Initially, Mr. Greco said, Procida planned to build a garage for 150 cars on the site, but the city rejected that idea. Instead the firm built a 37-car garage for residents, who can buy a space for around $200,000.
In Manhattan, a developer needs no permit to provide parking spots for 20 percent of the number of apartments in the building — assuming the entrance to the garage will not obstruct traffic. But to build more spaces, a developer needs city approval.
“In the old days you had to provide parking,” Mr. Greco said. “Now it is to the contrary, and what we are seeing is a slow evaporation of the parking spaces.”
Laurie Zucker is the vice chairwoman of the Zucker Organization, a development company, which with its management firm, Manhattan Skyline, owns and operates about 3,000 apartments in the New York area.
At the company’s new luxury rental building at 55 Thompson, the apartments are spacious, and many are suited for families. One-bedrooms start at $6,100 a month, and the three-bedrooms top out at $25,000 a month. But those prices don’t include parking.
Although 55 Thompson replaced the 1922 Tunnel garage, which was one of the first facilities designed specifically for cars, the city rejected a plan to build a large lot underneath the building. Ms. Zucker said the plans were then revised to create one parking spot for each of the 38 apartments. That, too, was rejected. In the end, the developers arranged for tenants to have discounted parking at a nearby garage.
You might think that owning a parking lot in a car-saturated city would be so lucrative that there would be little incentive to sell.
Vincent Petraro, the executive director of the Metropolitan Parking Association, an industry group, cited a variety of factors that might inspire a parking-lot owner to throw in the towel. “The parking industry is facing tremendous price resistance among consumers these days,” he said in a statement. “The industry faces the reality of fewer cars coming into Manhattan, a weaker economy as well as higher rents, higher real estate taxes, and higher insurance costs. Because of this, it is becoming more and more difficult to maintain profitability.”
Not to mention that the law of supply and demand makes even the grubbiest garage valuable real estate.
“It is a ready-to-go situation,” said Ms. Zucker, the developer of 55 Thompson. “For one thing, you don’t have existing tenants to deal with.
“There are a lot of developers with lots of money looking for sites,” she said.
Robert Gladstone, the chief executive of Madison Equities, recently built a nine-unit development at 57 Irving Place, the site of a stable-turned-garage. The cheapest apartment costs $6.75 million.
“I have torn down two buildings that were former stables in the last few years,” he said. And just as horses made room for cars, he said, cars are making room for humans. But parking is still a concern.
“It always comes up in conversation,” he said. “If you are designing for the super-rich, you have to find a place to put their cars.”
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