Parking lots tend to be little more than an afterthought for real-estate investors. But during the pandemic, asphalt has never been hotter.
Parking doesn’t usually generate much revenue for property owners. Most retail properties across the country have little-to-no parking fees, in part to entice more shoppers to the stores.
Now, with outdoor space at a premium, shopping malls and garages are opening their parking lots to tenants and other vendors for open-air stores and other events. At a time when most brick-and-mortar retail is suffering, landlords are grateful for anything that brings in any additional revenue or foot traffic.
At South Coast Plaza in Costa Mesa, Calif., the landlord built open-air stores on the second floor of the parking garage “to help our retailers transact in-person business,” when the state government ordered a second shutdown in July, said Debra Gunn Downing, executive director of marketing at the mall. While indoor shopping is allowed again, the space remains available for luxury boutiques like Balenciaga and Givenchy for special appointments with their customers.
Some use lots for public-service functions like job fairs, voting stations and drive-through Covid-19 testing. Others have become gathering spots for trivia or bingo games where participants play from their cars.
Other lots and garages are used as small distribution centers. They service retailers such as Walmart Inc., Target Corp. and Best Buy Co. , which say that curbside pickup has surged during the pandemic.
“These tenants maximized their exterior storefronts and parking areas,” said Joshua Bruff, vice president of property management at Raider Hill Advisors, a retail real-estate investment and advisory firm.
Garage owners, meanwhile, have rented their space to delivery companies that distribute goods through trailers that store goods that are popular with online customers living nearby.
“Parking garage owners saw the exodus of [car] drivers during the pandemic,” said Harrison Azizi, head of operations at Bond, a logistics company with a network of small distribution centers that offer same-day delivery services. He recently signed leasing contracts in Los Angeles, San Francisco and New York during the pandemic.
Some parking lots host events aimed at children and families. The lot at Rosedale Center in Roseville, Minn., has been transformed into a haunted house with tents that will offer daily performances for guests 14 and older through Nov. 1.
“They stay in their cars, and actors come into your window covered in blood, with lighting and sound for about 20 minutes,” said Chad Kampe, founder of Flip Phone, an events organizer usually for indoor entertainment.
While he has done indoor and rooftop events before, “this is the first time ever in a parking lot,” Mr. Kampe said. Flip Phone said it has sold nearly 1,000 car tickets for $75 each.
The event is expected to draw thousands of people who could then dine or shop at the mall before or after the event, said Sarah Fossen, director of marketing and experience at the two-story Rosedale Center.
Other parking lots are cleared for seniors. Rob Peters Entertainment this month hosted a music bingo event at a community-center parking lot in Hamilton, Mass. The company served hot dogs and played songs from the 1950s and ’60s for around 20 seniors who received one-time-use cards and listened to the music from their car radios.
“Even though they were 50 feet away, you could hear them singing along,” said Rob Peter, the owner.
Write to Esther Fung at [email protected]
Haunted Houses, Bingo Games, Covid-19 Testing. Parking Lots See More Action Than Adjoining Shops. Wire Services/ WSJ.