How Banks Perpetuate Overbuilt Parking

Even as cities and states are reducing or eliminating parking requirements, lenders often require parking to release loans to developers.

1 minute read

October 13, 2022, 6:00 AM PDT

By Diana Ionescu @aworkoffiction


Virginia

f11photo / Shutterstock

Ned Oliver, in an article in Axios, cautions that, although the city of Richmond, Virginia is encouraging more density and walkability by reducing parking requirements, developers face another challenge to reducing parking: banks.

Per city rules, “Developers are no longer required to offer any dedicated parking if their building contains fewer than 17 units. For larger developments, they only have to provide one space for every two units.” But according to Oliver, “In exchange for agreeing to finance an apartment project, banks almost always require developers to build a minimum number of parking spaces — often well above the requirements set by the city, developers say.”

The problem affects affordable housing developments more than market rate ones where more residents own cars, but Tom Papa of Fountain Head Properties expressed concern that “parking minimums that make sense today will prove to be a financial albatross for developments 10 years down the road as Richmond changes.”

More on Planetizen:

Tuesday, October 11, 2022 in Axios

Aerial view of homes on green hillsides in Daly City, California.

Depopulation Patterns Get Weird

A recent ranking of “declining” cities heavily features some of the most expensive cities in the country — including New York City and a half-dozen in the San Francisco Bay Area.

April 10, 2024 - California Planning & Development Report

Aerial view of Oakland, California with bay in background

California Exodus: Population Drops Below 39 Million

Never mind the 40 million that demographers predicted the Golden State would reach by 2018. The state's population dipped below 39 million to 38.965 million last July, according to Census data released in March, the lowest since 2015.

April 11, 2024 - Los Angeles Times

A view straight down LaSalle Street, lined by high-rise buildings with an El line running horizontally over the street.

Chicago to Turn High-Rise Offices into Housing

Four commercial buildings in the Chicago Loop have been approved for redevelopment into housing in a bid to revitalize the city’s downtown post-pandemic.

April 10, 2024 - Chicago Construction News

Woman with long hair wearing Covid mask sitting on underground train station bench looking at her watch as subway train approaches in background at Hollywood/Western station in Los Angeles, California.

How California Transit Agencies are Addressing Rider Harassment

Safety and harassment are commonly cited reasons passengers, particularly women and girls, avoid public transit.

April 17 - The American Prospect

Nighttime view of wildfire in Los Angeles hills.

Significant Investments Needed to Protect LA County Residents From Climate Hazards

A new study estimates that LA County must invest billions of dollars before 2040 to protect residents from extreme heat, increasing precipitation, worsening wildfires, rising sea levels, and climate-induced public health threats.

April 17 - Los Angeles Times

Bird's eye view of oil field in New Mexico desert.

Federal Rule Raises Cost for Oil and Gas Extraction on Public Lands

An update to federal regulations raises minimum bonding to limit orphaned wells and ensure cleanup costs are covered — but it still may not be enough to mitigate the damages caused by oil and gas drilling.

April 17 - High Country News

News from HUD User

HUD's Office of Policy Development and Research

Call for Speakers

Mpact Transit + Community

New Updates on PD&R Edge

HUD's Office of Policy Development and Research

Urban Design for Planners 1: Software Tools

This six-course series explores essential urban design concepts using open source software and equips planners with the tools they need to participate fully in the urban design process.

Planning for Universal Design

Learn the tools for implementing Universal Design in planning regulations.