September 4, 2014

Downtown Columbia deals with parking crunch

City spent record $1.7 million in parking discounts to bring in 850-bed student housing complex. Ultimately, the parking issue might be more of a matter of readjusting to the new level of activity downtown said one downtown property owner.

Downtown Columbia is headed for a parking crunch – growing pains for a rapidly redeveloping Main Street that has attracted hundreds of new residents, workers and businesses in recent months.

The situation has the city scrambling to find a way to accommodate the people it has worked so hard to attract to the corridor for more than a decade. The city spent a record $1.7 million in parking discounts to attract The Hub, a new 850-bed student housing high-rise that opened last month, according to internal city of Columbia communications obtained by The State newspaper. But the influx of students and young professionals is limiting access and increasing parking costs for the employees of at least one business.

Ultimately, the parking issue might be more of a matter of readjusting to the new level of activity downtown, said Tom Prioreschi, owner of Capitol Places, a downtown apartment rental company headquartered along Main Street with hundreds of tenants in place.

Prioreschi was one of the first developers to take a chance on Main Street in the late 1990s. Redevelopment was painfully slow until about three years ago when Mast General Store opened, spurring a rash of restaurants, retailers and residents to move to the street.

“Sixteen years ago, when we came here, parking was certainly not a problem,” Prioreschi said. “If there is a parking (problem)... it’s a good problem to have. It’s a very, very good problem to have and may we have more and more and more of it.”

Lease was key to Hub deal

Two and a half years ago, parking negotiations between Core Campus, developer of The Hub, and the city were high-stakes talks.

“The total subsidy offered through construction and the first five years of occupancy would be $956,580,” wrote city parking services director John David Spade in an Oct. 16, 2012, email to then-city manager Steve Gantt. “The figure for the first 10 years would be $1,751,400.

“This represents the largest discount ever offered to any business for parking in a city-owned garage,” Spade wrote. “Normally, we have not extended discounts beyond the second year, other than standard volume discounts of 10 percent.”

At one point, the Chicago-based company said it would pull out of the $40 million redevelopment of the long-vacant building and its city-owned garage, the documents show.

Ultimately, the city and Core Campus agreed to a 50-year lease that provides about 470 spaces at varying rates.

The bulk of the spaces, 338, cost Core Campus $36 per month, Spade said Thursday in an interview. Another 82 spaces the company eliminated to make room for a rooftop swimming pool and other amenities cost the developers $5,000 annually. Lastly, Core Campus pays $25 per month for more than 40 spaces for mopeds and motorcycles. The company’s lowest fee is $5 monthly for seven spaces lost to construction of a new staircase and a room for the pool pump, Spade said.

The lease does not limit how much Core Campus can charge its tenants for parking.

The Marriott hotel leases up to 300 spaces in the garage under a 31-year-old agreement with the city.

Core Campus initially wanted to pay almost nothing for parking spaces.

“If possible, Core requests that these spaces be provided at $1 per space per year or the lowest possible, nominal monthly charge,” a company executive wrote to Gantt on March 9, 2012.

Six months later, Spade countered in an email to his bosses that Core Campus should pay rates that ranged from $34 to $52 per space.

Core Campus did not like that offer.

“These cost levels negatively impact the projected financial performance to the extent that Core could not pursue the project,” a Sept. 28, 2012, letter from the same company executive states, who’s identified only through a signature, which appears to be a series of initials. “Core has suspended all efforts on the project pending significant progress on the issues below,” the letter to Gantt states. It outlines waivers of sewage tap fees and the need for more than 300 spaces the city had offered to that point.

Core Campus stressed from the outset the importance of reduced-rate parking to the entire project. The company saw the discount as a way to soften its multimillion-dollar investment on Main Street.

“Market conditions also require that parking be proximate and inexpensive (competing projects offer free parking),” the executive wrote to Gantt on Aug. 31, 2012, after Core Campus had agreed to buy the Palmetto Center.

“We understood that the city has no incentive available to help mitigate the cost,” wrote the company official. “The best possibility to assist the project that we discussed was favorable arrangements for the cost associated with the use of the Sumter Street garage,” the letter states.

When the utility giant SCANA Corp. occupied the building, it leased nearly 900 spaces in that and nearby city garages, Spade said. SCANA paid about $75 monthly for spaces in the Sumter Street garage that Core Campus is renting.

Parking has become a hardship, some say

Meanwhile, some business owners say parking has become a hardship with all of the additional cars that are downtown everyday, especially as the city changes the rules for the Sumter Street garage.

Right now, drivers are charged either hourly or monthly to park in the garage. Since SCANA left downtown in 2005, parking accessibility in the garage was easy, particularly after 5 p.m., but The Hub has made things tighter with around-the-clock residents and visitors, some downtown businesspeople say.

The city plans to begin charging to park in the Sumter Street garage 24 hours a day, seven days a week, which businesspeople such as Edson Munekata, Cowboy Brazilian Steakhouse owner, said will cost approximately $50 a week for each of his restaurant employees, because no new monthly parking permits are available in the complex.

The city has offered Munekata cheaper reserved parking for his employees at the city-owned garage at Taylor and Sumter Street, he said, though it is farther away from his establishment.

“I think the fair way to do this is for the city to come up with a standard answer for all the business owners downtown and their employees as far as what they are expected to pay for parking in terms of access and fee structure,” Munekata said.

“I don’t know how many thousands of employees there are downtown, but right now, obviously everybody is parking some place with whatever parking arrangements they have in place. But telling a businessman (at Main and Hampton streets) the closest parking he can get for his employees is down on Washington Street (at Assembly Street) detracts from growth,” Munekata said.

Hampton Street Vineyards restaurant co-owner Leigh Talmadge said parking always has been a problem in his 19 years there. Since The Hub opened, “it’s really been difficult,” he said.

City leaders, including Mayor Steve Benjamin, city management including parking personnel, the City Center Partnership and some businesspeople reportedly were to meet Thursday to discuss how all the affected parties could work together and successfully co-exist, one downtown businessman said. Results of that meeting were not immediately available.

Meanwhile, a mid-year parking study released last week shows parking availability in the downtown Columbia Business District tightened 4 percent since last year, but remains adequate. The district has approximately 3,318 parking spaces available in 18 parking facilities, according to Colliers International’s 2014 parking update issued last Friday. The vacancy rate for all parking garages in the district last year was 33 percent, which fell to 29 percent by mid-2014 – before The Hub opened.

Still, the city has received only a handful of parking complaints and those have eased after the student move-in day late last month, according to parking services director Spade.He said the biggest problem has been tenants of The Hub who park in spaces not assigned to them. Some vehicles have been towed and the city has written a few tickets, he said.

“I have gotten nothing but good comments from downtown businesses and from City Center Partnership,” Spade said, referring to the advocacy group for Main Street-area businesses.

His department has upped its cleaning of public garages downtown recently and the city will financially benefit from The Hub, Spade predicted. “There are other monies that will come into the city such as business license fees and property taxes,” he said.

Marriott general manager Joel Darr said the hotel so far has not had any challenges meeting parking demands for big events such as college football game weekends. But he said more thought needs to be given to parking when festivals and such events are scheduled.

“The challenge right now is having everybody know where to go and what to do,” Darr said.

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