Today’s guest is Jeff Patterson.
Jeff is an active member of the National Parking Association (NPA) and one of less than 500 Certified Parking Professionals in the country, Patterson is a pioneer in the advancement of technology in the valet and parking industries.
Show summary:
In this episode, Jeff Patterson, President of Phoenix Parking Solutions, discusses how his company is revolutionizing the parking industry with cloud-based solutions. The company’s technology offers digital permits, validation, and various payment options, eliminating the need for expensive gate systems. Despite challenges, the company has managed to increase profits for clients significantly. Patterson also discusses the future of the parking industry, emphasizing the shift towards touchless solutions.
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Intro [00:00:00]
Challenges and Solutions in Parking Management [00:02:11]
Cost Savings and Profit Increase [00:08:34]
Competitors’ Difficult App Experience [00:10:24]
The Mobility Movement in Parking [00:12:45]
Security and License Plate Readers [00:16:14]
Revolutionizing the Parking Space [00:20:43]
Challenges and Solutions [00:21:14]
Contact Information [00:21:33]
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Connect with Jeff:
Linkedin: https://www.linkedin.com/in/jeff-patterson-pps/ https://www.linkedin.com/company/phoenixparkingsolutions/
Web: https://www.phoenixparkingsolutions.com/
Phone: (678) 412-0505
Connect with Sam:
I love helping others place money outside of traditional investments that both diversify a strategy and provide solid predictable returns.
Facebook: https://www.facebook.com/HowtoscaleCRE/
LinkedIn: https://www.linkedin.com/in/samwilsonhowtoscalecre/
Email me → sam@brickeninvestmentgroup.com
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Want to read the full show notes of the episode? Check it out below:
Jeff Patterson ([00:00:00]) – When we finish going through this scenario, at the bottom of it, we compare what was their profit to what their profit would be with us. And on $1 million a year gross revenue. A parking garage. They were making an additional $168,000.
Intro ([00:00:15]) – Welcome to the how to Scale Commercial Real Estate show. Whether you are an active or passive investor, we’ll teach you how to scale your real estate investing business into something big.
Sam Wilson ([00:00:28]) – Jeff Patterson is the president of Phoenix Parking Solutions. He is leading innovation in the parking industry by specializing in parking management services. Jeff, welcome to the show.
Jeff Patterson ([00:00:39]) – Thank you. Happy to be here.
Sam Wilson ([00:00:40]) – Absolutely, Jeff. The pleasure is mine. There are three questions I ask every guest who comes on the show in 90s or less. Can you tell me where did you start? Where are you now? And how did you get there?
Jeff Patterson ([00:00:50]) – Uh, I started as a financial advisor, subsidizing my income by valeting cars, and ultimately created my own company with another gentleman that was doing the same thing.
Jeff Patterson ([00:01:05]) – Ten years later, I bought him out. I transitioned the company to be all for tech thinking, and now we are nationwide as of last year, focusing on all of our digital solutions to help property owners and just looking forward to the continued growth.
Sam Wilson ([00:01:25]) – Man, that’s cool. Parking is one of those things that’s so few people think about. I mean, it’s it’s kind of the overlooked asset class, but yet it’s not because obviously for those that are in the in the parking business, they understand it very well. But it is I think what you guys are doing is really cool in the parking business. And I know you said you’re kind of forward thinking in your in your company, but you guys are revolutionizing the way people pay for and that businesses manage their parking assets. Can you break some of that down for us?
Jeff Patterson ([00:01:56]) – Sure. We bring in cloud based solutions. So that way you have a property. For instance, I was talking to a client here recently that it’s a small parking lot, but they still want to have parking management on it.
Jeff Patterson ([00:02:11]) – It’s going to generate revenue from it. You don’t have to go and spend $150,000 to put in gate systems or pay on foot machines. You can still have your digital permits, you can still validate based upon your retail leases, and you can still collect revenue with, you know, scan your QR code or text to park options with all the all the the hefty equipment and install cost that typically you would have to do.
Sam Wilson ([00:02:36]) – How I mean, do you you said you started in the financial advisory business. Like how have you built a tech, basically a tech company without a tech background.
Jeff Patterson ([00:02:50]) – I’ve always been an IT kind of guy. Um, and just being in the industry for parking, there was one of the things that really frustrated me was having to pay people to do very mundane tasks, to go around and hand out these monthly permits, to manually build people for each credit card processes in place, to constantly go reload these tickets on these gate arms. But I can do everything from my cell phone, but I can’t give someone a monthly parking pass without, you know, it’ll be two days and you know all these other steps in the process.
Jeff Patterson ([00:03:26]) – There had to be a better solution. So I started really digging into that and taking wireframes, sketches and things like that to potential interested parties about seven years ago.
Sam Wilson ([00:03:40]) – It’s a, it’s a you without really that technical expertise to build what you wanted. You kind of took the big idea to some industry partners and said, hey, help me build this out.
Jeff Patterson ([00:03:50]) – You got it.
Sam Wilson ([00:03:51]) – Cool. Love that. That’s really, really great. And I guess was there. Did you have to carve out any of your business to bring those industry partners on, or were those just advisors that came on, you paid them to then develop the product for you?
Jeff Patterson ([00:04:06]) – I originally invested into the company, and then that company sold, and I still have a great working relationship with them.
Sam Wilson ([00:04:16]) – Got it, got it. Okay, cool. I guess I just ask all those things as people think about, we’re in a business right now or they’re something similar to this. So I asked with my own kind of needs in mind where it’s like, how do you tackle a problem like this? Where I go, gosh, we need this technical expertise to do this.
Sam Wilson ([00:04:34]) – I don’t have any idea how to do that. And then do you do you bring on those partners? Do you then just get out your checkbook and write an enormous sum of money to somebody hoping they get it right, which I’ve got some other friends that have done that and failed miserably because they’re like, well, the product now is totally worthless. And we just spent several hundred thousand dollars just in initial stages of development. It was a total flop. So I’m always curious how people without that real in-depth technical expertise figure things like this out. So that’s that’s really, really cool. Let’s go back to parking though I love parking. I think it’s a phenomenal asset class. I think it’s I always joke, I’m like, what? Like, what are you going to do if your parking lot floods? It’s a surface lot. You wait till the water goes down. Like, this is just one of the best businesses in the world to, to be in. And I think I think you understand that.
Sam Wilson ([00:05:20]) – But we’ve got legacy issues there. Like you’re saying gate arms. When I was looking at parking lots to buy, we always if I saw an attendant sitting there in the booth collecting money, I knew that there was that there was money walking out the door. I mean, because, you know, they’re letting their buddies in or they are keeping a 10% of what comes in the till, or I mean, untold numbers of ways that owners were losing money. And like, that’s a lot to buy. The one right there with the guy working the working the gate. But so you guys saw those solutions and you said, we can do this with cloud based software. What are some challenges that maybe every every technology presents its own new issues and problems you got to solve? What are some problems, maybe now that have been solved, that you’ve got this in place?
Jeff Patterson ([00:06:08]) – Some problems that have been created by this or. Yeah, additional things that have been resolved.
Sam Wilson ([00:06:13]) – Yeah. Well are either or one of those, either one of those where it’s like, hey, you know what we’ve got now, now we’ve got this or maybe, maybe to say it a different way.
Sam Wilson ([00:06:21]) – What are some problems you have yet to solve in the space now that you’ve got this technology?
Jeff Patterson ([00:06:27]) – I would say we’ve got most of them resolved as of a few months ago. They we had a few little line items there that we were trying to to button up. And, you know, whenever you release a new technology or you deploy something, the consumer is always going to try to find ways around it, right?
Sam Wilson ([00:06:44]) – Yeah.
Jeff Patterson ([00:06:45]) – So we had to figure out ways to protect that. And for example, our validation platform where you say you go into an orange 30 fitness or sweat house or a restaurant and you walk inside you, there’s a tablet there for you. You type in your phone number, type in your plate number, it’s success. And then you get a text message that verifies it, said, hey, you’ve been validated, let you know when your time is expiring. And more easy peasy, right? But we ended up running into situations where people were trying to abuse that 90 minute validation.
Jeff Patterson ([00:07:18]) – So we had to put in restrictions where it could only be used once every 24 hours. Then you didn’t have employees. Instead of buying monthly permits, validating back to back, or the person who went to lunch decided they wanted to take a walk afterwards, and they’re just going to, you know, validate again and get some free parking.
Sam Wilson ([00:07:37]) – Got it.
Sam Wilson ([00:07:38]) – Oh that’s interesting. Yeah. People are always trying to find ways to game game the system. What have been some of the cost savings? I know you mentioned the installation of gate arms, filling the tickets. You know doing all those things that owners, you know, or, or operators have to deal with. But what have been some of the cost savings you’ve seen for people adopting your technology?
Jeff Patterson ([00:08:02]) – So I actually flew up to one of my larger clients. That’s a big developer around the country a year and a half ago, and we sat down and reviewed one of their. Monthly. You know, pals from a property. We just call this property ABC property.
Jeff Patterson ([00:08:20]) – Okay. We went line by line item on every single thing that their gated solution to our gate list solution. What’s going to be different? And we’re sitting down with their national rep. So it’s not like we’re, you know, giving them a bunch of fluff. This guy knows what we’re talking about.
Sam Wilson ([00:08:33]) – Right?
Jeff Patterson ([00:08:34]) – When we finish going through this scenario at the bottom of it, we compare what was their profit to what their profit would be with us. And on $1 million a year gross revenue, a parking garage, they were making an additional $168,000.
Sam Wilson ([00:08:50]) – Good grief. Good grief.
Jeff Patterson ([00:08:52]) – So just a little bit.
Sam Wilson ([00:08:53]) – Right, right. I mean, what why why are owners I mean, I’m sure they are, but what are some common objections owners are giving when presented with a solution and not moving forward with it?
Jeff Patterson ([00:09:07]) – A lot of people are stuck in their ways. It’s the same cookie cutter model of what we’ve always done. It’s not broken, don’t fix it. But at the same time period, you know, if, for instance, in Atlanta, it used to cost $15,000 a space to build a parking garage, now it costs 40,000.
Jeff Patterson ([00:09:23]) – So, you know, really need to take into account the ROI here. And if you can deploy solutions that are better for your consumers, that are better for the retailers to help you draw in better tenants then, and it doesn’t cost you as much money up front. I think that’s a win win for everybody.
Sam Wilson ([00:09:45]) – Absolutely. No. That’s I mean, it’s I think it’s great and I’ve seen plenty of that even here in the sleepy Memphis parking market. Seen a lot of those. I mean, there’s just not much in the Memphis market that really is exciting when it comes to parking, I’ll be honest. But have you even seen a lot of those lots going, especially the service lives downtown going to, you know, pay by license plate and things like that. Here is a scenario I ran into recently, and maybe you guys can tell me how you’re overcoming that. I was at a I went to park somewhere and it was it wasn’t your platform. I can’t remember who it was, but it was a pay by park, pay by license plate, and I was only going to be there for about an hour.
Sam Wilson ([00:10:24]) – And I pulled up and I had to, like, download an app, give my life history, tell them my credit card, my kids birthdays, and dude, I got like seven minutes in and I’m like, screw it. You know what? I’m going to I’m going to roll the bones here and I’m just not going to pay. I’m not giving you the $10 because now I’m thoroughly irritated trying to give you money. Why are competitors making it so hard? And how do you guys do it differently?
Jeff Patterson ([00:10:49]) – That was one of the biggest points that I had. And when we were developing this technology, they everybody was jumping on the bandwagon. And you had this company’s app and that company’s that and another company’s app, and who wants to have an app for everything? Parking. As far as the whole gambit of an app for everything is kind of went out the window, right? Yes. It’s great. You can do everything in your phone, but don’t want to have a file that has all the different parking companies out there I’ve ever parked with app on it that I’ve had to take 7 to 10 minutes to complete something.
Jeff Patterson ([00:11:24]) – Yeah, like I’m the one supposed to be doing the work, not the consumer, right? So we removed that aspect from it, where our consumers either text a code or they scan a QR code, which, you know, those have become very popular these days and don’t really see them going anywhere.
Sam Wilson ([00:11:39]) – Right.
Jeff Patterson ([00:11:40]) – And for instance, you scan the QR code, it opens up in your web browser. You type in your phone number so that we have a dedicated URL. Um, and then it moves you right over putting your plate number, select your time, use Apple Pay, Google Pay, Cash App, Venmo whichever way you want. It’s less than 20s done.
Sam Wilson ([00:12:00]) – That’s amazing. Yeah. That’s amazing. I didn’t get a ticket that day. There was nobody came by and towed my car. I didn’t get a boot on my car or anything else, but but that’s the way it should be, right? It’s removing removing those barriers to to spend money with the with the consumer. That’s really cool.
Sam Wilson ([00:12:15]) – I’m glad I figured you had an answer to that. And you’d already solved that problem because, man, I said, there’s just no way that that this is the norm. Because that was that was a thoroughly frustrating. What what’s the opportunity then right now in the parking business? Is there is there any consolidations happening? Is there corporate compression? What’s what’s going on in parking. Because we’re seeing kind of commercial real estate as a whole, whether it be office space, multifamily, softening, things like that. What’s happening as a whole in the parking industry. Can you give us any insight on that?
Jeff Patterson ([00:12:45]) – Yes. Next week is actually the National Parking Association’s conference and expo. That happens once a year. There’ll be probably 2000 parking professionals, including other folks like yourself, that invest in parking lots coming out there to see what is this technology, who’s got this? What options are there, you know, how is this moving? And they’re calling it the mobility movement. So currently it’s the parking world is moving out of these archaic systems and kind of spitballing us an extra 5 to 7 years forward in this.
Jeff Patterson ([00:13:17]) – And there’s because everybody wanted touchless solutions. You don’t want to have to press the button to get your ticket. You don’t want to have to wait in line to touch the same kiosk and pay on it that everyone before you just did, right. So a lot more solutions came into play. And with that you’re seeing this, you know, like I said, mobility movement coming in the past. And you have companies like Reath who’s one of the top five that they built a lot of their own tech labs building their tech plus the largest in the world building sphere. Um. Bigger companies are building their own, but there’s tons of other options out there for other operators to utilize and in so many situations that owned business for me, but just being full transparency, sure, where you can operate it yourself and you don’t need an operator, right? If it’s something basic, you know, if you’re just looking for something very simple, there’s technology there where you don’t have to hire a full parking management company.
Jeff Patterson ([00:14:14]) – Um, it just depends what you’re looking for. Such as residential. If you’re using a mixed use development, all of your monthly permits, instead of giving your residents these little decals that they put on each of your windshields, you can do them all digital and just do it on your own using one of these cloud based softwares that are out there.
Sam Wilson ([00:14:32]) – That. That’s really cool. And that was going to be one of my questions was how much of this is eliminating the need for an operator? I mean, for those who are listening, a lot of times at least what we own, we would obviously just get with a local operator, then they would operate the lot, and then we would they would get paid by the operator. In this case, I’m thinking about some of the lots that we own. We could have just eliminated the.
Sam Wilson ([00:14:52]) – Middleman.
Sam Wilson ([00:14:53]) – And ran this technology on our lots without without the third party taking their cut of the of the revenue.
Jeff Patterson ([00:15:01]) – It definitely does create some of those situations out there, but you still need someone to overall manage the location, whether you’re hiring them yourself in-house.
Jeff Patterson ([00:15:12]) – For someone to make sure your sign is good, make sure the porter is cleaning the lot to make sure that the technology is doing as things in the background, to issue the permits to decline, the permits to monitor your validations and look for abuse to. Uh, handling disputes when it’s enforcement or booting or towing to provide that customer service that feel, and to also review the ratings of your consumers to see what do they like and not like about your experience. So that way you can be proactive about forgiving them a better one next time they come.
Sam Wilson ([00:15:50]) – Yeah, I think that that was gonna be one of my questions was how? And you touched on a lot of things that a good operator will do, obviously, on our behalf. You know, one of those is just making sure people like me aren’t parking there and not paying the the not paying their, their, their ticket to, to to park there for an hour. So that’s, you know, that’s that’s really, really great. Jeff, let’s talk a little bit about security in the parking lots.
Sam Wilson ([00:16:14]) – I know we kind of talked about this maybe off air, but you were talking about, you know, removal of gate arms, some of the hesitations that some owners may have in moving to a solution like this, in kind of the perceived security that comes along with gate arms, fences, things like that. What’s, what’s what’s how do you guys overcome some of that hesitation on that front by removing those items?
Jeff Patterson ([00:16:36]) – That’s a very, very good question. And I believe that there is a bit of a false sense of security that people have with the gate arm. If you think about a criminal, if if he’s going to break your window, is he really care about breaking your gate arm?
Sam Wilson ([00:16:51]) – No.
Jeff Patterson ([00:16:52]) – No. So there’s not really that much more security that’s being provided. But I do get it from a revenue protection standpoint of being able to get out of the gate. And that’s one of the big topics of, well, now that there’s no gate, how do you guarantee people are going to pay and don’t want people’s first experience to come into my facility and there’s just boots all over the ground, and people might be having arguments with the booter about getting it, you know, removed.
Jeff Patterson ([00:17:19]) – So. LPR. We all know about license plate readers. They’re on the freeways. They’re everywhere these days, and we utilize these in surface lots and in parking garages to track when you come inside. And it’s integrated with our software platform, where after X amount of time it asks, is this person good? Did they validate? Did they pay? Did they have a monthly permit? And if they don’t, it flags them in the system automatically reaches out to that state. Department of Driver’s Services pulls their information, and in 2 or 3 days they get a nice little bill in the mail that says, here’s where you came in, here’s what you left. You forgot to pay for the services rendered. And, you know, please click here. Now to pay it’s X amount for the first couple of days and then the price goes up. If you don’t pay, we get good collections on it because we’re not writing you a ticket. We’re sending you a bill for services rendered and so we can follow up.
Jeff Patterson ([00:18:20]) – Just like any other bill. You don’t pay, you go to collections, and then most people end up paying their bill at that time period.
Sam Wilson ([00:18:26]) – Right? Yeah. I was going to ask what the enforceability of that is, you know, is it is it worth. And it sounds like it is. Because if you’ve got a good system in place to then send it to collections, or then to send it to something that goes on the record permanently, it becomes much, much more enticing to go ahead and make that payment. Um, but yeah, I was just curious how that how that did eventually work out. So that’s that’s really, really cool. I love that, I love that, and I love the ability to follow up with those people that park there and actually send them that bill and that mail. What’s that been like integrating with the state database? You said 46. Why not 50?
Jeff Patterson ([00:19:08]) – Certain states are not willing to share the information like California, New York. They will not give out the consumers information.
Jeff Patterson ([00:19:17]) – And we are working to change that, because if the state writes you a ticket, they follow up pretty harshly on it. But you as a private property owner, if you write someone to take it in those particular states, they’re not willing to give you the same information that they have for you to follow up on that. And I know that and some other big third party aggregators that handle these type of enforcement for us across the country, they are working to make it all 50.
Sam Wilson ([00:19:46]) – Right, right. Yeah.
Sam Wilson ([00:19:48]) – That would seem like that would be an imperative if you’re going to do business in those states. So I guess, has that prevented you from then deploying your technology in those states?
Jeff Patterson ([00:19:57]) – And some of the states. It’s definitely been a barrier to entry. If you run across someone who is very hesitant about booting enforcement or towing enforcement, and I personally am not a fan of towing enforcement like LPR, you know you get a ticket in the mail three days later. Hope you caught me. All right, scan this QR code.
Jeff Patterson ([00:20:19]) – Pay for it. Call today. Make sure I get it next time. It’s not the same thing as your car is gone, or you’re waiting for someone to come and remove a boot off. And now you’re late to your next appointment. Um. I think that these states that are not. Uh, on board. It would be a much better experience for the consumers in that state to allow this to, you know, happen.
Sam Wilson ([00:20:41]) – Right, right.
Sam Wilson ([00:20:43]) – That’s interesting man. This is really cool. I love what you’re doing in the parking space, no pun intended and really revolutionizing. I’m sure you get that a lot. But revolutionizing the way that people pay, interact, the management, the efficiency of what you guys are doing, I think is just astounding. And you mentioned things I’d never even thought of, which was, you know, because obviously we don’t live in I don’t live in an area in Memphis, Tennessee, where this is necessarily an issue, but in a lot of bigger cities, you’re going to a restaurant, you’re going to work out, you’re going to places that need parking constantly validated and or paid for.
Sam Wilson ([00:21:14]) – And you guys have thought through a lot of the things that, you know, would would be challenges that, that, that otherwise, you know, to overcome that, you know, you guys have solved a pretty, pretty slick solution here. So I think this is really, really cool. If our listeners, Jeff, want to get in touch with you and learn more about Phoenix Parking Solutions, what is the best way to do that?
Jeff Patterson ([00:21:33]) – I go to our website, Phoenix Parking solutions.com. Or you can always give us a call and ask our receptionist to transfer over to me. I’d be happy to talk to anybody. Our number is (678) 412-0505.
Sam Wilson ([00:21:46]) – Perfect. Thank you sir. We’ll make sure to include all of that there in the show notes. And thank you again, Jeff, for coming on today. It was certainly a pleasure. Thank you. Hey, thanks for listening to the How to Scale Commercial Real Estate podcast. If you can do me a favor and subscribe and leave us a review on Apple Podcasts, Spotify, Google Podcasts, whatever platform it is you use to listen.
Sam Wilson ([00:22:06]) – If you can do that for us, that would be a fantastic help to the show. It helps us both attract new listeners as well as rank higher on those directories. So appreciate you listening. Thanks so much and hope to catch you on the next episode.
