Car parks increasingly on investors’ radar
By Sara Seddon Kilbinger, Senior Reporter, REFIRE
E-charging changing face of sector
Car parks are increasingly on investors’ radar as they look for stable alternative investments in challenging economic times.
According to Catella’s latest market tracker "The Market for Parking Facilities", parking remains an emotional investment even in turbulent investment markets. Operationally, around 60% of European car parks are facing comprehensive refurbishment measures in the next 10 years, according to the report.
Investor interest has been on the up in past two years, with €325 million of deals transacted in Europe between 2020 and 2022. The average yield is 5.25%, and the value of an average car park is between €25 million and €31 million.
At the beginning of 2022, the number of registered passenger vehicles in Germany stood at around 48.5 million, representing a y-on-y growth of 0.6%, according to Catella. In the EU, there were 560 cars per thousand inhabitants in 2020 (2011: 486 cars). While Germany and France are well above the EU average, the figure in Sweden has been stagnating for years. The highest growth rates in the number of passenger cars per 1,000 inhabitants between 2015 and 2020 can be found in Romania (+45.2%), followed by Lithuania (29.9%). Among the countries analysed, Bulgaria is the only country with a negative growth rate. In Sweden, the growth rate was just above 0%, at 0.4%.
APCOA signs multi-million deal with Compleo Charging Solutions
There will be a clear need for car parks in European cities in the future and due to the increasing popularity of e-cars, the provision of charging stations is becoming the focus of strategic decisions by car park operators.
This week, APCOA Parking UK Ltd has signed a multi-million deal with Dortmund-based Compleo Charging Solutions to supply EV charging stations for their growing network.
The deal will see Compleo UK deliver a further 1000 AC charging stations by the end of 2024. It furthers the relationship between APCOA and Compleo after their initial partnership saw 451 AC chargers being installed across six Network Rail public car parks last year.
APCOA PARKING Group is one of Europe's largest parking operators, managing more than 1.8 million individual parking spaces at over 12,000 locations in 13 European countries This latest expansion will also see APCOA extend their service offering in the EV market by providing 24-7 customer support via their National Customer Service Centre and dedicated maintenance and support teams, giving EV drivers confidence, and ensuring a high-level of uptime on their network.
‘Compleo’s commitment to continuous development of charging technology and the support from the UK team make Compleo the perfect partner for our AC EV charge point network,’ said Kim Challis, regional managing director UK & Ireland and Group ESG Director. ‘The APCOA Connect payment app puts accessibility and customer experience first and is integrated via API with the Compleo backend software, enabling EV drivers to park and charge in either one single payment or separate transactions.’
Compleo Charging Solutions UK is part of Compleo Charging Solutions AG, one of Europe’s full service providers of EV charging technology. The company supports its business customers with charging software technologies as well as AC and DC charging stations. Its DC charging stations are the first on the market that comply with European calibration regulations.
Catella Parken Europa acquires Largo Corsia dei Servi
Catella has also been beefing up exposure to car parks this month for its pan-European parking fund “Catella Parken Europa” with its acquisition of the eight-storey underground car park Largo Corsia dei Servi with 332 parking spaces in the centre of Milan. The long-term tenant is APCOA.
Largo Corsia dei Servi is located in the heart of the Milan’s city centre right between the main shopping street Corso Vittorio Emanuele II and the office and shopping street Corso Europa: ‘After we recently acquired the two underground car parks Ave. Kleber and Marché Saint Germain in the heart of Paris for Catella Parken Europa, we are now delighted, together with our experienced partners Orange Investment Managers, to make another purchase in one of Europe's top metropolises,’ said Axel Bertram, portfolio management, Catella Parken Europa. ‘Car parks like this will play an increasingly important role in urban mobility in the future, due to a focus on reducing on-street parking and channeling car mobility in cities, and are particularly suitable for investors who are looking for an "infrastructure-related" investment with a balanced risk-return profile in the current economic situation.’
Car parks can be a good alternative investment, offering the investor a middle-ground opportunity that falls somewhere between a fully-fledged trading property and a traditional property investment, according to Savills. There is a range of small to large investment opportunities, and while they can be owner-operated as a trading property, they require significantly less management than other trading sectors. Operational costs vary considerably on a site-by-site basis and are dependent upon where it is – the costs of a car park in the city centre will differ from one at an airport, for example.
However, the valuation and analysis of car park assets can be complicated, largely due to the limited number of transactions each year, and even fewer on an operational basis or without an underlying long-term development angle to the sale, according to Savills. With few major operators in the industry, car parks are often owned as part of a portfolio allowing for economies of scale on administrative costs, marketing, and group initiatives.