Company Perks: Reserved Parking Is So Yesteryear
Just as Hollywood studios were releasing their pre-Christmas Oscar contenders, a seismic shift was taking place on the Sony Pictures (SNE) lot. "This went all the way up to Michael Lynton and Amy Pascal," says Manny Rodriguez, Sony's security operations manager, referring to the formidable studio heads. On Dec. 13, Sony broke with Hollywood tradition and completed a reduction of personally reserved parking spaces on its lot from more than 1,000 to 115.
Rodriguez, who oversees parking and events, had noticed that about $800,000 per year was being spent on valet services since—with many producers leaving their reserved spots vacant—there were never enough spaces. The hardest part of that battle, he recalls, was removing the personalized nameplates, long considered as important a Hollywood status symbol as the right to throw coffee at assistants. "It was Dogfight City," remembers Rodriguez. "The parking public was so pissed off. They said we'd have to wear bulletproof vests across the lot." So far, though, he's had his way. "I had a pretty big hoo-ha from a pretty big director who wanted his name on the wall. He said, 'I'm going to make my own sign.' "As Rodriguez remembers the standoff, he becomes serious. "I told him, 'We're going to tear it off!' "
As one of the last remnants of the corporate feudal system, reserved spots have nearly disappeared from office lots across the country. If you've wondered why income disparity is growing, it's probably because there's no longer any other reason to climb the corporate ladder. In an age of increasingly egalitarian office culture, reserved parking has become déclassé. "People who need the designated office space, they're probably not the right employee for Netflix (NFLX)," says Steve Swasey, vice-president of corporate communications for the on-demand video company. Unlike pretty much every other company, Netflix doesn't have expense account limits (just don't go nuts!) or vacation day restrictions (take a break!), so it certainly doesn't have reserved spots. "If I said to our CEO or head of HR that we should have reserved parking spaces," Swasey says, "they would not know how to deal with that question."
Google (GOOG), which shuttles many of its employees to its Mountain View (Calif.) campus, offers reserved parking, but only for pregnant women and people needing outlets to plug in their electric cars. Other tech operations have followed their lead. "As technology companies shifted from the East to West Coast," says Simon Hartley, director of sales and marketing for Arlington (Tex.)-based Thursby Software Systems, "their success, in part, was due to dropping the old management approaches embodied in ideas like reserved parking."
Reserved spots have also vanished because they're expensive. "It's actually a very poor allocation of [funds]," says Helen Sullivan, communications counsel for the Fredericksburg (Va.)-based International Parking Institute, the industry's trade organization. (Banner initiative: "Parking Matters"; monthly magazine: The Parking Professional; annual expo: May 22-25 in Pittsburgh, with keynote speaker Rocky Bleier, four-time Super Bowl champion and expert parker.) Clyde B. Wilson, president and chief executive officer of the Parking Network, a consulting company that does financial audits of parking lots, says a parking management company often will oversell an office lot by 15 percent because only about 85 percent of workers show up every day. Reserved spaces that remain empty when the car owner is out drive up costs for maintenance, security, and real estate.
Big Parking has become such a serious business—valued at more than $18 billion in 2008 by research firm Marketdata Enterprises—that a developer in Miami's South Beach hired the architecture firm Herzog & de Meuron, which designed the National Stadium in Beijing, to create a $65 million public garage. Built last year, it houses a glass-walled clothing boutique and a penthouse apartment. It charges four times as much as nearby garages do for parking, and up to $15,000 for special events. People even get married there.
In uncertain times, however, parking has become a crucial line item, as it was for Sony Pictures. "Most of the private sector is now much more concerned with generating as much revenue as possible out of parking," says Barbara Chance, who runs a Philadelphia-based parking consulting company, Chance Management Advisors. The company has counseled Princeton University, the Carlyle Group, and the Kuwaiti government, and Chance has been profiled twice in Parking Today, The Parking Professional's top competitor. She says the decline in reserved spaces has to do with managers' recent need for anonymity. "If you're the boss or a manager and someone is angry at you, then they can find your car," she says. "There's a lot more tension now, it's a tougher time."
People who have held onto their reserved parking spaces have also become increasingly annoying. "They call me all day. They call me even if it's their customers who are in their space. They'll have them towed," says Paul Mann, director of operations for Elite Parking in Atlanta. "The higher-ups are a pain in the ass." Reserved spots, it seems, make people power mad in a way that titles, office space, or money don't. "When someone gets a promotion, the first thing they ask is, 'Do I get a spot now?'" says Mann. "Before they want their money, they want their spot."
There are four businesses, however, where reserved spaces are holding on: hospitals, universities, government, and—with the exception of Sony—movie studios. One parking consultant, who spoke on the condition of anonymity because hospital parking politics are so ferocious, says nurses often curry favors with doctors for their spots, which must be the premise of at least one late-night Cinemax movie. Hollywood studios employ people to reassign spots each time a production starts up or tanks. Robert Evans, who ran Paramount Pictures (VIA.B) from 1966 to 1974, still has a space there. And it's a good space. So good that he declined to discuss it for this article.
College professors are also notoriously demanding. "Parking is the strangest little animal you've ever set your eyes on," says Doug Holmes, the interim director of transportation services at Pennsylvania State University. At other schools, professors have reserved spaces at multiple sites throughout campus, depending on where they teach. "You've got a sea of signs across campus that you need to maintain. It's a royal pain," says Holmes.
Though not at Penn State. The university reserves only 60 of its 17,500 parking spaces, which was the closest that higher powers would let them get to zero. "You get enough people with enough clout and they're going to have a reserved space," says Holmes. "When the president says, 'I'm going to have a reserved space,' he's going to get it."
The university's parking policy states that only senior vice-presidents or above get a spot, for $86 a month. Penn State's legendary football coach, Joe Paterno, has won more games than any other coach in major college history. He's contributed more than $4 million to the school. He's also 84. And he has to fight for a spot like everybody else. "Joe Paterno is not a senior vice-president," says Holmes. "If he has to go an extra 10, 15 feet, he walks."