Category Archives: Politics

Parking Building Economics

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If the value of a car parking space is greater than the cost of supplying the car parking space then private investors will provide parking. Should politicians use ratepayer or/and taxpayer money to subsidize and/or oversupply car parking, the value of a car parking space will fall, but the cost will not.

This post is based on parking building economics as explained in 1973 as an appendix to the Traffic management plan for Hamilton.

To try make this relevant in today’s money the Value in [$—] is in today’s money as per the Reserve Bank Inflation calculator, using the following settings.

Category – General (CPI)

Date of cost above – 1973 Q1

Date for comparison – 2017 Q1

Traffic Management Plan for Hamilton Report No.3 – Central Business Area (CBA) Off-Street Parking – REF 0711 730 993 115 1 HAM – April 1973

Appendix II – page 16

Parking Building Economics

The following is an approximate estimate of the economics relating to the construction of a 500 car parking building within close proximity to the city centre as suggested in the Transportation Study Planning Report.

  1. Cost

(a) Capital Cost

A parking building will cost about $2,500 [$31,030] per car space (excluding land). A 500 space building would therefore cost $1,250,000. [$15,515,845]

(b) Operating Costs

It is envisaged that operating costs and costs for such items as maintenance, lighting and insurance would be in the order of $75,000 [$930,950] per annum.

(c) Annual Costs

Annual cost of a building would be:-

Loan Charge and servicing (10% p.a) $125,000 [$1,551,584]

Operating Costs                                        $75,000 [$930,950]

Total $200,000 [$2,482,535]

  1. Revenue

The revenue required for a building to be self-supporting with an annual cost of $200,000 [$2,482,535] would be approximately $1.60 [$19.86] per space per day.

To collect $1.60 [$19.86] per space per day, based on a 10-hour day and a maximum operational occupancy of 80%, it would be necessary for the parking charge to be 20c [$2.48] /hour

Note that the existing Central Car Park has an occupancy of 65% and revenue of 45c [$5.59] /space/day (1972/73 receipts)

Now in the real world of this century some of the above costs are not like-for-like:

(1)   The VALUE or COST per car space this decade is more like a third less at about $12 or $20k, giving a 500 space building a cost of $6 or $10 million. – source

(2)   The Annual Cost of servicing a loan at (6% p.a.) = $360k or $600k plus Operating costs of $930k = Total of $1,290 or $1,530k divided by 500 spaces = $2,580 / $3,060 per space per year.

 

(3)   Revenue needed to service a loan of $2,580 or $3,060 per space per year is $10.32 or $12.24 per day. (Based on 250 days)

To collect $10.32 or $12.24 per space per day, based on a 10-hour day and a maximum operational occupancy of 80% it would be necessary for the parking charge to be $1.29 or $1.53 per hour

 

This is pretty close to the cost of parking at the Knox street Parking building.

EARLY BIRD PARKING

$7.00 flat rate
Entry between 4:00am and 10:00am
Exit before 7:00pm

CASUAL PARKING (BEFORE 6PM)

0-1 hour $3.00
1-2 hours $5.00
2-3 hours $7.00
3-4 hours $9.00
4-5 hours $12.00
Daily Max $12.00 (12 hour ticket)
Lost ticket $20.00

EVENING PARKING (AFTER 6PM)

$5.00 flat rate

SATURDAY AND SUNDAY

$5.00 flat rate

Hamilton as a medium sized city in German

These two earlier posts, Hamilton as medium sized city in Netherlands and Hamilton compared to a medium sized city in Australia, show Hamilton can be seen as a more densely populated type of city. To take this a step further, this post adds German cities to the list. For Germany, the number of cities that can act as benchmarks becomes larger and the closeness to major cities gives density patterns similar to those measured in Australia , with the higher density cities being part of the metropolitan area of a major city. The sources for data on German cities are wikipedia List of cities in Germany by population and City Mayors German top cities

hamilton-pop-density-thousands-netherlands-germany

What makes these German cities an interesting comparison to Hamilton is that most have a river flowing through them; below are photos from three of them, showing Koblenz with the rivers Rhine and Moselle, Kassel with the Fulda River, and Ulm on the River Danube

Koblenz Rhine & Moselle Rivers Kassel Fulda River 1 Ulm Danube River 1

Something worth exploring further is how these river promenades link with the city retail area and what activities are actually happening. Are people attracted to the river edge area more because of the width of open spaces and good sight lines or because of commercial activity?