Investing in car parks may not be the first thing which comes to mind for commercial property investors, but this type of enterprise has proven profitable for savvy investors. According to the International Parking Institute, this industry is responsible for generating more than £12.6 billion in revenue each year.
At any given time, there are approximately 29 million parked vehicles in the United Kingdom. The RAC Foundation predicts that this number will increase by at least four million more over the next 20 years, which means the demand for parking facilities (and the potential revenue) will continue to grow.
If the car park is in a strong location, this investment has the potential to generate a good return. Consider investing in covered parking facilities in City Centres and Central Business Districts, since these are the places where drivers are looking for convenient places to leave their vehicles. Features like clearly marked pricing structures and surveillance will make motorists feel more confident about leaving their car in a car park.
Manchester is an example of a growing city where opportunities for car park investments could be readily available. Not only has it been named the fastest-growing city in the United Kingdom, but it has a thriving City Centre with a population of 498,800 (Manchester City Council 2010). Parking rates in Manchester are among the highest in the UK, with only motorists in London and Edinburgh paying more for this necessary service.
Another advantage of a car park investment is that it is much more economical for new investors looking to enter the market than buying commercial real estate or other available options. It can provide a steady, stable income for investors looking to get their feet wet or for more experienced business owners who are looking to diversify their holdings with a low-risk option.
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