Transforming Parking Operations at 935M by ARIUM

Overview

When RMR acquired the predecessor to RMR Residential, we assumed a parking contract at 935M by ARIUM. The agreement included outdated parking technology and misaligned incentives. These gaps were costing the property both revenue and resident satisfaction. Recognizing this was not industry standard, RMR’s sourcing team initiated a review and renegotiation with the goal of transforming parking from a pain point into a value driver.

The Challenge

We identified two key issues in the inherited parking program:

Unfavorable Terms

• The vendor retained 60% of parking revenue, leaving RMR with only 40%.

Operational Inefficiencies

• Payment relied on QR codes and manual time selection, allowing transient parkers to underreport their stay.
• Residents used badges to grant visitors free access to the nested parking area, resulting in lost value.
• Transient visitors parked in spaces reserved for monthly parkers.
• The parking garage was not properly being cleaned and maintained to RMR’s standard.

Strategic Actions

Contract Review & Negotiation

Leveraging deep industry knowledge and commercial contract experience, the sourcing team identified the opportunity for improvement and, as the legacy contract neared expiration, RMR negotiated a new agreement with its preferred parking vendor, Metropolis.

Technology Implementation

• License Plate Recognition (LPR) and New Gates: Metropolis installed LPR cameras at all entry/exit points and nested areas. Metropolis also installed new high-speed gates to improve the visitor experience.
• Metropolis App Integration: Parkers register their license plate and payment information once. Charges are automated based on actual time spent in the parking garage.
• Resident Management: Residents are recognized as monthly parkers, with seamless access to the nested area.

Outcomes: Revenue Protection & Growth

• Accurate Billing: LPR eliminates underreported stays – parkers are charged for actual time spent in the parking garage.
• Visitor Revenue Capture: Visitors of residents are now billed, closing a major revenue gap.
• Improved Revenue Split: The new contract terms are significantly more favorable for RMR, as we moved away from a revenue share model which increased NOI by over $100,000.

Comparative Analysis A detailed analysis of actuals and pro forma data for 935M demonstrates a substantial improvement in NOI because of RMR’s renegotiation of the parking contract and deploying Metropolis’s advanced technology. Conservative financial modeling kept revenue flat, though improved controls and user experience are expected to drive growth.

Key Insights:

• Expenses: Metropolis’s technology-driven model reduced annual expenses by over $100,000.
• NOI: The NOI with Metropolis is more than double that of our previous vendor, resulting in an annual increase of $123,931.

Conclusion

RMR’s sourcing team successfully leveraged strategic partnerships and advanced technology to renegotiate an unfavorable parking contract, optimize revenue capture and increase NOI at 935M. The transition to Metropolis’s automated parking management system addressed key operational inefficiencies and revenue leaking, setting a precedent for value-driven vendor negotiations and technology adoption in CRE.