“Each one of those visitors is coming for some kind of a different reason, and parking in a different place and probably paying a different price,” Teed says.
CampusParc tracks how many of the nearly 37,000 spaces are occupied at any moment of the day and how long they are occupied for. Eventually, it hopes to provide its 40,000 permit holders with wayfinding technology to the nearest available space.
Another example of the value of data is for maintenance.
Teed says the 400 lanes going in and out of parking facilities are data points that not only give information about the vehicles coming in and out but also the equipment surrounding the lane.
“We can be much more intentional about our preventative maintenance programs and the extension of the useful life of that equipment, and ultimately customer satisfaction,” he says. “If the lane equipment isn’t working, and you can’t get out of the garage, then you’re a dissatisfied customer.”
Getting value from the data
By using fact-based decision-making, the business operations today are more efficient.
Teed says everything used to be operated to suit the requirements of the university at any given time, making it unpredictable.
If OSU wanted all the gates to go up and parking to be free for a day, it would just decide to do that. That doesn’t happen any more. On the other hand, gate equipment only worked about 60 percent of the time. CampusParc has that up to 99.9 percent.
The key is understanding where you’re going with the data collection process and what its value is, Teed says.
“You can collect a lot of data, but if you don’t know what you’re going to do with it, then what’s the point?” he asks.
That data also needs to be validated, in order to use it to make decisions.
“We’re lucky because in our business every transaction goes through a piece of equipment — we know the date, the time and the person with a high degree of accuracy,” Teed says
“So our data is good, and we constantly scrub it to make sure it is good. Other industries may not be so lucky in collecting the sort of data they need,” he says.
All of the good data must be consolidated, so it can then be sliced and diced in a useful way. And this isn’t easy to get right, so organizations that are new to data collection need time to get up to speed, Teed says.
But it’s critical to put the time in, especially if your industry is evolving rapidly like parking.
The concession
The parent company of CampusParc is Queensland Investment Corp., which manages a little over $50 billion in U.S. dollars for Australian retirees.
Along with the traditional pockets of investment QIC specializes in infrastructure investing — toll roads, airports, seaports, utilities and parking systems that are associated with universities, hospitals, airports, etc.
CampusParc CEO David Teed says infrastructure investing is normally done through concession agreements. These allow QIC or its subsidiary to operate the asset for a set term, before returning it to the public owner.
QIC gave The Ohio State University $483 million for the right to operate its parking system for 50 years. It was the first university parking privatization in North America, which has resulted in a lot of interest from other entities who are considering a similar path.
Teed says the agreement allows OSU to monetize a non-core function and focus more on its mission.
“At the end of the 50 years, they get their assets back in the same as or better condition, under the terms of the agreement,” he says. “And they’ve had the use of the capital to redeploy it into more mission critical activities in the meantime.”
The university has already earned $112 million on the initial sum and directed those earnings to adding faculty, scholarships and other services. Teed says OSU expects to earn $3 billion on the $483 million over the 50 years.
At the same time, OSU has transferred its capital expenditure risk — maintaining the parking assets — for the next 50 years. Teed says CampusParc estimates it will cost around $300 million to maintain OSU’s parking lots and garages over that time.
From QIC’s point of view, the concession agreement means a stable cash flow stream for its retiree obligations.
“We’re conservative investors. We have to protect our retirees’ capital. We’re not private equity investors,” he says. “We’re not tasked with making outsized returns, but we’re tasked with modest returns that are appropriate for a risk-adjusted retiree situation.”
And of course, this sounds very financial, Teed says, but at the same time it’s a strategic partnership for both parties over the next 50 years, for better or worse.
“We have to think very carefully about OSU’s strategic goals and how we can be a useful partner in achieving those goals,” he says.
