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Inside Nashville’s valet parking boom

Marketplace Contributor Aug 29, 2014

Inside Nashville’s valet parking boom

Marketplace Contributor Aug 29, 2014

Tyler Ross is a musician who parks cars in his spare time — and for spare change. Shaved head, standard-issue polo shirt, khakis and Ray-Bans to shield the beating sun, he looks like the quintessential valet guy. Having been in the game for about a year, slick rides barely faze him.

“It’s always funny because people are like, ‘you park Mercedes and BMWs?’ And I’m like ‘Yeah, I park a hundred of those, they’re not nice any more, ya know? I park Aston Martins and Bentleys and stuff,'” says Ross, who personally drives a Toyota Matrix.

Ross is among hundreds of part-time valet workers who have found employment in Nashville’s valet boom. In the city’s urban core, where Ross mostly works, searching for a spot feels like a treasure hunt, and that spells big opportunity for purveyors of parking assistance.

According to city records, there were a little more than a dozen valet locations in 2011. That number is on track to triple by year’s end.

When David Purcell was planning the development of his burger joint Pour House, parking availability wasn’t foremost on his mind. But that quickly changed.

“You look at your lot, and you go, ‘OK, I have plenty of parking,’ until you actually open and look at the space you’re trying to fill,” Purcell says. Other restaurant owners echoed that: public parking is getting harder and harder to find while, for many business owners, the prospect of purchasing a separate lot is not manageable. So Purcell pays a valet company to take care of it.

“If you own a parking lot, it’s a license to print money,” Purcell says. “Had to do it all over again, I’d probably be in a different business.”

Fred Kane, a land broker with Cassidy Turley, says he hears from restaurant owners all the time who would like to buy land for parking, but it’s rarely available. When it is, the price is astronomical — a reflection of steadily rising land values all around Nashville’s hip neighborhoods. He recalls selling a piece of land to some investors.

“I go, ‘Guys, this is the last $20-a-foot dirt in Nashville,'” Kane says. “Now the stuff around there is $90 to a $100.”

Kane says big returns on investment don’t come from stand-alone parking garages, so for developers, it’s not an easy sell. It’s more palatable for an investor when the project is at least partially publicly-financed. Even with some public support, though, lenders consider a parking garage a risky bet.

“Nobody is going to lend them the money to build the $15 million, $20 million parking deck, until the demand is there,” Kane says, adding that what drivers perceive as high demand and what banks perceive as high demand are vastly different.

Right now, valets have a big advantage.

Here’s how it works:

When a restaurant applies for a permit from the city, the owners have to show how they’re going to supply parking. The city generally requires one parking space per 1,000 square feet of floor space. That’s not much.

Kane says many restaurants are outsourcing all parking obligations to valet companies. When a business applies for a permit, an owner shows city officials a contract stating that the valet company will handle parking.

When restaurants offload parking to valet companies, parking lot owners get a payday, since they’re leasing space. Then Tyler Ross gets a call a to work. The valet boom is great for him, but in the end, it’s very much a service industry job.

“The famous ‘crumble up the one dollar bill so it looks like you’re giving more but it’s really one dollar’ — yeah, that happens all the time,” Ross says.

His wage is like a restaurant server’s, based on tips. He says three bucks is the average. “Two sometimes, like, nothing wrong with two,” he says.

Catching his breath after parking in a lot about a block away, Ross says the inside of a person’s car is a telling portal into their personality.

“Some people are kind of embarrassed about the inside of their car,” he says. “But I try not to pay attention to it, because I’ve seen it all.”

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