DicvoWest’s Breton Birkhofer discusses why Metropolis is a breakthrough in parking’s value proposition for real estate owners.

At a time when every square foot of real estate needs to be optimized for revenue performance and tenant experience, Metropolis introduces a model that aligns incentives with real estate owners.

There’s a lot of low hanging fruit when it comes to optimizing the performance of a parking garage. Consider the capital expense asset owners could save just by simplifying the parking vendor ecosystem. Traditional parking operators cobble together a disjointed mix of hardware companies, staffing agencies, service providers, technology vendors, and aggregators. This adds cost and complexity while reducing transparency for asset owners.

At Metropolis, we upend the traditionally transactional operator and real estate owner relationship by bringing the entire parking ecosystem in-house: we build and operate our own proprietary technology that removes the need for paper tickets and pay machines. The end result is a simplified parking ecosystem, increased operating income and a revolutionized customer experience.

We spoke with DivcoWest’s Breton Birkhofer about the Metropolis value proposition for real estate partners. Take a look below:

“What Metropolis is really doing is transforming a business model that hasn't changed in many years, and focusing on a model where they're aligned with the owners on every decision - maximizing NOI alongside a truly elevated customer experience.”

— Breton Birkhofer, Managing Director, Venture Investments, DivcoWest

Metropolis: Hi Breton! Thought we’d start with a big-picture question. How would you describe the Metropolis value proposition to real estate owners?

Breton Birkhofer: There are three main elements that are super important to an asset owner and can fundamentally transform the business model of a traditional garage. The first is cutting operational costs and optimizing the operations of a parking asset.

The second piece is all about driving the new revenue at the asset. Both in terms of optimizing the current parking revenue, as well as layering additional revenue streams to the asset that maximize NOI relative to traditional operators.

And then finally one of the biggest benefits of Metropolis is the unique and seamless customer experience that's created through the technology.

M: From your perspective, could you walk us through the traditional parking business model?

BB: Historically, incentives are not very aligned between a parking operator and an asset owner. A lot of that has to do with the cost-plus business model and the fact that there's various line items that have the potential to inflate over time. There’s not a great incentive for operators to actually reduce those line items.

Before Metropolis, there were a number of challenges that we've seen with traditional operators. One of them is equipment failure… The more equipment you have, the more maintenance you're going to have to do and the greater the odds of something failing.

Another one is staffing challenges. Every industry is facing some form of staffing shortage and parking is certainly no exception. Another is revenue leakage. You know, particularly when you have cash payment options, it's really hard to account for all of that and there's high potential for revenue leakage.

What Metropolis is really doing is transforming this business model that hasn't changed in many years, and focusing on a model where they're aligned with the owners on every decision - maximizing NOI alongside a truly elevated customer experience.

M: Beyond the business model, how has working with Metropolis been different?

BB: One thing that I appreciate most about working with Metropolis, and what's made the experience very unique, is the data analytics and real-time visibility that Metropolis is able to uniquely provide. It's one of the first times that asset owners have really had that comprehensive view into how their garages perform, and the ability to to make quick decisions on how to optimize things.

So whether it's understanding traffic flows or how much demand there is, how to optimize pricing, or how tenants interact with the garage, you package up all that visibility and it gives the asset owner a lot more control.

M: What were some doubts that you had about Metropolis?

BB: My initial doubts around the Metropolis were, you know, “This is a new company… How long have they been operating? What's their expertise in specific markets?” I think the company really overcame this first question by acquiring Premier Parking to create one of the largest national parking operators.

I think the second question was around, “What actually is the computer vision operating system? How does this work?” This one is really about experiencing the technology yourself. So that's where piloting the solution is super important. Seeing it work, live, and then getting comfortable with how that's going to scale.

What really stands out is that Metropolis provides an end-to-end solution for the asset owner. They're not just selling technology to the operator. They're not just an operator. They combine those things to deliver the most value possible to an owner.

They have a holistic vision: not just selling technology to the operators, but delivering a fully tech-enabled parking garage experience. And I think that's really important because you're getting all the benefits of the technology as the asset owner yourself.

The other piece of that is the vision beyond just automating a garage today, making sure those assets are functional and productive for decades to come. I think that's definitely a unique part of the company.

M: Thanks so much for your time, Breton!