The customer experience begins and ends in the parking area,” says Alexi Hakim, GM at InterContinental Toronto Hotel Centre. It’s why parking is a subject that, while not among the most glamorous in the world of hotel management, might ultimately be one of the most critical. A hotel’s parking lot, after all, starts the conversation for a guest about the quality, professionalism, cleanliness and customer service that can be expected while staying at the property.
In some cases, a hotel owns and operates its own parking facilities; in other cases, it outsources the responsibility to a third party. It’s not uncommon for a management firm to have both types in its stable. At Starwood’s Sheraton Centre Toronto, for example, parking is managed in-house, while parking at its Westin Calgary and Westin Edmonton properties is outsourced, and the hotel gets a fixed monthly cheque in return.
Which side you’re on depends largely on your ownership group, says Daniel Melnyk, director of Sales at the Parkside Hotel & Spa in Victoria, B.C. “Some see parking as incremental income that pads their flow-through to the bottom line; others look at it a lot more aggressively.” Whether a hotel is in a teeming urban centre or a more spacious suburban or rural setting influences the subject markedly. “Parking is a given for hotels in the parklands or at the airport,” says George DeSilva, GM of Holiday Inn Toronto Downtown Centre, “but the downtown hotels that have their own lots don’t get the recognition they deserve.” He estimates that just half of Canada’s downtown hotels have their own parking facilities.
Regardless of which side a hotel sits, any parking discussion should centre on space, mainten-ance, security and innovation.
At the Parkside, the two-floor, 120- to 130-space parking lot below the 126-room hotel represents the operation’s third-biggest revenue source (after the hotel and spa). “We never put any effort into parking,” prior to the change of ownership in March, Melnyk admits. “We just accepted that it came and went.” But more recent “significant discussions” about the subject have resulted in a price change, as the parking fee was recently lowered from $19 a night to $15 a night, in response to decreased usage when the cost was raised several months ago. Melnyk has also initiated a marketing plan (featuring Craigslist and UsedVictoria.com ads, along with Facebook and Twitter blasts) aimed at monthly parkers, including people who work in the area and condo owners with two cars. Approximately 10 per cent of the lot’s business comes from external users.
Meanwhile, DeSilva’s 500-room Holiday Inn manages its own two-level parking facility under the hotel. The 127 available parking spaces frequently run at full capacity. And, InterContinental Toronto Hotel Centre also owns its parking area and has since the property opened. It means the hotel’s management team can extend discounted or complimentary parking to guests of the hotel restaurant and spa. “[That’s] been very helpful for us in driving the Azure business in the hotel,” says Hakim, the hotel’s GM, while referencing the on-site restaurant.
Parking also represents an opportunity for hotels to differentiate themselves from one another. The management at the Holiday Inn Toronto Downtown Centre recently had parking pay machines installed in the lobby, so guests can pay for parking without having to line up at the front desk. At the InterContinental, guests are relieved of having to park their own vehicles courtesy of the hotel’s across-the-board valet service. Guests at this property also have access to a car wash in the same garage, a service that costs between $25 and $45, depending on the package purchased.
To add to that, plans are afoot to outfit the InterContinental’s lot with electric vehicle charging stations as a further selling point. At the Parkside Hotel & Spa, these are already a reality. When the hotel opened in August 2009, it capitalized on its LEED platinum standard status with the installation of six electric vehicle-charging stations on the first parking level. So far, they haven’t gotten much use. “But they have a future purpose and, from a marketing perspective, they’ve attracted a lot of interest,” says Melnyk.
Le Centre Sheraton Montreal, the Sheraton Centre Toronto and the new Element Vaughan Southwest in Vaughan, Ont., also offer complimentary electric vehicle-charging stations to guests. The latter boasts preferred guest parking for hybrid and low-emission cars and can accommodate some 25 oversized vehicles in its lot.
Innovations aside, security is a key concern in hotel parking lots. At the InterContinental, six security cameras monitor the lot, with a seventh at the hotel’s entrance. There’s also manned security inside and outside the garage. A security team performs spot checks throughout the day at the Holiday Inn Toronto Downtown Centre. Digital cameras record what vehicles are in the lot, and equipment is maintained assiduously. “A lot of hotels have garages with doors that stay open,” scoffs DeSilva. “That’s dangerous. We make sure our garage door is always working properly.”
Beyond security, the prickly business of liability is another challenge in hotel parking lots. Whatever minor scratches or accidents a guest’s vehicle might sustain during his stay are entirely assumed by the hotel. “Our goal is to make sure we pay for any mistake we make,” says Hakim.
But above all, says Dan Young, public relations manager, Starwood Hotels & Resorts, “The big-gest challenge of managing parking, especially in a downtown location, is the limited space available for parking while demand remains high.” Knowing what percentage of guests are staying on any given night provides some insight into the subject, suggests Holiday Inn’s DeSilva. In addition to overnight guests at his hotel, there’s a constant influx of business types attending meetings during the day. “It’s up to us when we make arrangements for the meetings to find out how many will be driving in,” adds DeSilva.
It’s the same story at the InterContinental Toronto Hotel Centre at the crowded foot of Toronto, where guests access just 75 spots that are managed by a valet. On those occasions when demand exceeds supply, the hotel has an arrangement to lease spots from the adjoining Metro Toronto Convention Centre. Staying on top of this balance is a daily challenge, says Hakim. Usually, be-tween 70 and 75 per cent of the hotel’s spots are filled.
“It depends on who’s in town, who’s coming to town, whether they’re driving, flying or taking the train. Our goal is to make sure we have enough spots for our driving guests. Obviously, we want to make sure the cost of parking is fair, but it’s not economical for us to lose money to satisfy guests’ needs,” adds Hakim.
Parking at the InterContinental costs $45 a day. That, says GM Hakim, is “very comparable” with other hotels in the vicinity. In-and-out privileges are included in the fee, and the lot is open 24 hours. At the downtown Toronto Holiday Inn, parking costs guests $25 a day, also including in-and-out privileges. This ability for guests to come and go is a “unique factor,” says DeSilva. “If you leave [the city lots], you have to pay the daily parking rate again. We guarantee our guests that if they leave us and drive to the [Air Canada Centre], there will be a spot held for them when they come back.”
Ideally, the biggest and most enduring challenge for a hotel with regard to its parking operation should be identifying additional revenue sources from it, says the Parkside’s Melnyk. “Whether that means making parking available to locals, charging for day parking for hotel meeting attendees and spa and café guests or attaching a fee to electricity at the electric-vehicle stations, when your hotel runs at a certain occupancy, there’s a certain percentage of revenue you can expect to extract from the parking lot,” he says. “How to grow that revenue stream from there is the constant goal.”
Illustration by Brian Fitzgerald