Parking: to share or not to share?

Question

Happy New Year, BP community!

Hoping I can get some feedback and opinions on how to address parking in our 4-plex.  For this question, it's Unit 1 and Unit 2 that are being discussed.  The property has a narrow driveway that easily fits 2 cars.  Unit 1 has no parking (per the lease) and Unit 2 has the whole driveway (there is no lease for this tenant who has been there for 10 years).  We inherited the property with this arrangement in place.  In case it matters, Unit 2 sometimes uses both parking spaces when the on-again/off-again boyfriend is in the picture.

Unit 1 will be moving out in April, so I'll need to fill the vacancy, and I'd like to offer a parking spot to the new tenant in Unit 1.  Because Unit 2 has no lease, this is a perfect time to get that tenant on a lease with a written agreement (including the parking).

I've considered the following options:

• offer one parking spot per unit, and they need to figure out between themselves and their schedule who parks in front and who parks in back
• offer one parking spot per unit, and designate who parks in each spot (giving Unit 2 first choice.  She is a great tenant)
• let unit 2 keep the whole driveway but charge for it (and what charge is reasonable?).  This may make Unit 1 more difficult to fill...I would think people want a parking space.
• spend the money to expand the parking so that each tenant can park side-by side, and we can then let the other units have parking as well.  We have priced this out already, and the cost makes it my least favorite option.

I'd be interested to hear how others would approach this.  Thanks in advance!

Frank Patalano · Answer

I would raise the rent, tell the second floor tenant that she had to share the driveway, tell the new first floor tenant that s/he has to share the driveway but remind them that 2nd floor has priority. Then let them handle it. I've had similar situations on a few properties in Pawtucket. Only had 2 phone calls about it in the last 10 years. I may have lost 1 tenant over it but I had no place to add parking. Parking is the first thing that I look at when I personally view a new opportunity. I've lost money because of parking issues.

Greg M. · Answer

Her location is Cranston, RI. If that is where the rental is and assuming the weather site I read was correct, it rains around 265 days a year and snows around 60 days a year. I suspect that if this is accurate, parking 30 feet closer would be an advantage tenants would willing to pay for.

Thomas S. · Answer

I would expand with a gravel driveway. It will solve the problem and is cost effective.

Ideally, if it was possible, I would use the back of the property, behind the building, as the parking area and leave the laneway open. Parking is more important than a yard for a multi plex.

Ray Harrell · Answer

Using Grover's words, "I think that sounds like an excellent idea!" or "I think that's a f-ing excellent idea!"

Nancy DeSocio · Answer

Hi @Ray Harrell,

Thanks for chiming in!  We would not recoup the money to expand for many years, which is why I don't favor that option.

There is on street parking on one side of the street, and no permit is required.  I have easily found parking when I go to the property.  Tenants have received tickets on trash day, as the cars cannot block the trash bins, so this becomes an issue for the tenants that work off hours shifts and are home during the day (and we have two of those tenants).

I agree with you that having them share the driveway will become an issue at some point.  I could offer the spot to the tenant that currently has it and raise the rent on the her new lease to include parking.  If she chooses to forego the parking option, I can include it as part of the rent when I advertise Unit 2 (and price the rent accordingy).

Ray Harrell · Answer

Can you recoup the cost of expanding the driveway within 2 years? with additional rent? What if you expand the driveway, and the tenant decides they will park on the street for cheaper rent?

If it's tandem parking I wouldn't try to make two spots. What if the owner of the second car is out with a friend and the first car needs to get out? Who's going to move the second car? I see trouble with that arrangement.

Charge extra for the driveway first-come, first-served. Let the other park on the street.

What cost is reasonable? How far is street parking from the building? If it's 20 ft, then even the current tenant may not want to pay extra, UNLESS street parking is scarce and/or requires a parking permit.

Matthew Paul · Answer

If its a 4 plex , that means you may get 4 couples there , all with cars . Thats 8 cars . I would gravel the back and make as much parking as possible .  If the existing pas takes 2 cars , plus 4 in the back , thats 6 . Make them deep in the back if possible and each unit has 2 spaces ( and less grass to cut )  .   gravel is cheap and if done properly can look good

Brandon Ingegneri · Answer

@Nancy DeSocio I have a similar situation with a few properties in Pawtucket.  I can give you some insight into what I have done, and maybe one of these will work for you.  On Armistice Blvd, I have a 3 family that has a 2 car depth driveway.  It is one car wide.  What I do here is let the most senior tenant have the driveway.  I've been doing it this way for a number of years now, and there hasn't been an issue yet.

I have one right off of exit 27 that has street parking only.  Luckily there is a park and ride that the tenants use when it snows.  Street parking is one of those things that kind of comes with the territory living in the city.  We have purchased the vacant lot next door and will be paving a parking lot in the spring.

Lastly, I have one off of Lonsdale Ave that is a 3 family that is set in front of a 2 family.  Long driveway, but not ideal for all 5 units to park.  I let the back house utilize the driveway, and I purchased the lot across the street and made a parking lot for the front house.  At this particularly property, I do have a towing account, and I regularly have to have people towed if people don't park in the appropriate areas.  The parking situation is clearly laid out and explained to everyone, but for some reason, this property in particular needs some continued effort in this aspect.  I attribute it to the section of Pawt.

Anthony Thompson · Answer

@Nancy DeSocio depending on the number of spaces that you can add, it's possible you could be creative and have another property in the area which also doesn't have parking, pay for part of the parking job in exchange for being able to use 1-2 of the new spots for X years (e.g., 10). Trying to think outside the box here.

Maybe a simpler option would be, depending on your current loan vs. the value of the property, get a small private loan (friends, family, other investors you know) to cover the cost of the parking, maybe it might be a high rate because it would be a 2nd mortgage but it would allow you to address the issue now and you could negotiate for the 1st payment not to be until a year from now.

I think there's some potential super-long-term value play buying properties without parking at a steep discount, and then waiting for the era of self-driving cars to arrive, but it's too speculative for my taste and we don't know how long or if such a future will arrive.

For the next decade or two, I think you will get a better quality of tenant if you can accommodate ones with cars, vs. ones that don't have cars. And if you find you want/need to sell the property, you won't be turning off potential buyers due to limited parking.

I think you'll also have less vacancy as the current parking situation seems to set up tenants to have conflicts, with snow days and you mentioned getting tickets on trash day. If I was a tenant, one or two of those tickets and I'd be pissed off and start looking for a new place (unless I had a super below market rent, which I'm not guessing is the case).

Like @Frank Patalano, parking one of the first things I look at with a property because in most areas, when I ask myself, "what kind of tenants here aren't going to have cars?" it's not usually the best.

And I agree with @Thomas S. that if your lot size/configuration allows it, you're much better off putting the parking in the back yard and having the side paved area just lead to the back yard parking. You usually get more parking spaces that way, and you have less grass/yard to maintain so it's a double win.

Good luck and please keep us updated on how it works out!

Nancy DeSocio · Answer

Thanks, @Frank Patalano.  We want to expand the parking, but we've only owned the property for less than a year and haven't built up much in cash reserves to pay for it (and prefer not to use our own money).    One of my first BP posts was about this driveway, and now it's coming up again due to my concern with filing the vacancy.  Maybe I shouldn't worry about an issue that doesn't exist yet, but I agree with you that it would attract better tenants, which is high on my list of importance.

I was hoping to get away with leaving it as is for another year or two in case we have some other unexpected (and more important) repair that is needed.  I'm curious as to what you would do in this case where expanding the parking isn't an ideal option right now?

@Joseph Mee, the property is in Pawtucket, and the city does allow parking on one side of the street (aside from parking bans).

Parking: to share or not to share?

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