A bright spot, there's parking available downtown.

Lot operators see business dwindle as factors intersect 

A combination of new lots opening, employee layoffs, the city's parking tax and rideshare programs have caused a parking recession in downtown Los Angeles, according to the operators of major lots.

Parking lot operators throughout downtown report dwindling revenues, empty spaces and falling parking rates.

"Parking rates have tumbled, just tumbled in the last few months," said Tom Barnett, president of Ampco Parking Inc., which operates more than 350 garages in Southern California. "Parking rates in Ampco's garages are down considerably."

Parking rates in a three-block "core" area of downtown have held steady, but all along the periphery of downtown, rates have taken a free fall from $6 to $3.50, Barnett said. Prices will fall further in the future, he predicted.

Parking will also get smacked next year as layoffs begin in the Bank of America-Security Pacific merger, Barnett said. "There's going to be an elimination of jobs. Whether its 1,000 monthly parkers or 4,000 monthly parkers, only time will tell," he said.

Stanley E. Long, president of the Parking Association of California, estimated parking business in downtown Los Angeles is down 35 percent since June. He added that he hasn't seen parking rates drop this fast in his 21 years as association director.

Association membership has also declined, Long noted. Small parking companies have gone out of business or merged with larger parking concerns, he explained.

"I think right now, downtown, the Central Business District, is more affected than Westwood or Hollywood or Century City," Long said. "It used to be the other way around. A few years ago, downtown had a parking shortage."

Several years ago, parking in downtown Los Angeles consisted of a number of open-space surface lots. Now, buildings with multi-floor underground parking and multi-floor parking structures have replaced the lots, Long said.

Downtown developer Maguire Thomas Partners is one of the largest parking lot owners in the area, according to Tim Walker, senior vice president of marketing for the development company.

Ed Simmons, president of Executive Parking Inc., a Westwood-based company with 1,000 spaces downtown, said he has noticed about a 10 percent drop in business there since June.

Simmons attributed the drop in business to new buildings and new parking garages opening, as well as companies instituting ridesharing programs to comply with the South Coast Air Quality Management District's Regulation 15. Under the rule, companies with 100 or more employees must institute ridesharing plans to encourage the use of mass transit, carpooling and telecommuting -- all of which reduce the number of downtown parkers.

In addition, Simmons and Long both said they believe the city's 10 percent tax on parking revenues, which went into effect last year, has driven business away.

But overall, Simmons blamed the decrease on the recession. "People have cut back and there have been a lot of layoffs. If I had to pick a main reason (for the parking decline), it would be the recession," he said.

While parkers decline, parking spaces continue to increase.

Maguire Thomas Partners is building a 2,400-space lot on the corner of 17th Street and Grand Avenue, which will have a shuttle service to bring parkers into downtown, said Tim Walker, senior vice president of marketing for the downtown developer.

In addition to that lot, Maguire Thomas is responsible for about 1,600 new downtown spaces in its projects, First Interstate World Center and The Gas Company Tower, which opened in the last two years.

Altogether, Maguire Thomas Partners controls eight lots and 11,764 spaces in downtown Los Angeles.

Long said, "Maguire Thomas has been buying up parking as fast as they can, as well they should." He noted that the developer would be in a better position than other downtown landlords to offer parking deals to prospective tenants.

Even so, Maguire Thomas has not been immune to the parking downturn and has dropped rates in some garages. "What we did is look at what everyone else is doing and what they're doing is dropping them and we're trying to keep competitive," Walker said.

One garage at which Maguire Thomas has cut rates is under Pershing Square.

Otto Schultz, manager of the Pershing Square parking garage, said he has never seen such high vacancies in the 2,500-car garage, and he has worked there since it opened in 1952 as the largest underground parking garage in the world.

The garage was down to 60 percent occupancy over the summer, but has increased to 80 percent since it began offering special deals in September, Schultz said.

Like the landlords in the office towers it serves, the Pershing Square Parking Garage is beginning to offer free rent and special deals. Starting Sept. 1, the garage dropped its monthly rate from $187 to $165. And if parkers are willing to pay for a year's parking upfront, they can get a month and a half free, Schultz said.

The garage has been hit with the double whammy of the recession and Metro Rail construction, which blocks the garage from Hope Street. Schultz said he has had to say goodbye to some long-term parkers who have been laid off in nearby law firms and the Jewelry Mart.

"We had many jewelers go out of business," he said. "The recession hit the jewelers badly."

It used to be that almost all the downtown garages had waiting lists for monthly parkers, Barnett said. Now, he noted, "You can walk in any garage off the street and pay for monthly parking."

He said employee downsizing has had a greater impact on parking than on office space. "Businesses in downtown that had 50 people on a floor in a highrise building now have 20 people on a floor," Barnett said.