Twitter / Balaji Sowmyanarayan

Tuesday, September 19, 2006

Parkade Ventures; mashup of Retail, Realestate, Autoclub

Idea: Recently multi-level computerized parking spaces got Infrastructure status. This makes investing in parkades attractive as it is an intersection intersection of organized retail, real estate, and access to automobile owning yuppy populace.

Traditionally Gold and Real-estate were the only investment avenues available for rich to grow their wealth easily. All other avenues required spending some time or effort and needed a lot of smarts and street savvy. Now there is a retail boom in-turn pushing up commercial realestate prices. And the automobile population is increasing exploding day by day. Urban parking facilities is increasingly a concern. Adding an interesting twist to the situation, recently, multi-level parkades became tax shelters due to their status as Infrastructure. Put everything together, then investing in creating a national retail chain of multi-level computurized parkade is an attractive proposition.

Execution: Buy land in by-lanes of congested business and shopping districts of congested urban areas. They will appreciate given the urbanization trend. Constructing multi-level parking facility is simple considering that it hardly needs major interior decoration like a retail space. There is no AC to be installed. And the power requirements are minimal. Thus the 'depreciating asset' capital expenses is attractive.

The running expenses and manpower requirements are even more attractive.

Computerization and customer management is the most interesting aspect of the investment. And the scale lends itself very well to create national retail chain. Here some smarts needs to be applied. This is what will differentiate the boys from the men.

With parking charges by the hour cash flow will be attractive. Smart way to bill the customer: half yearly or annual billing with 'subsidy/underwriting' by retail brands and credit card operators etc.


Profit: Retail space is set for consolidation and M&A action 3-5 years from now on. There is a lot of venture money being pumped in to India. This kind of safe ventures are good ways to create good return on exit. And venture funds investing in such ventures will also support a small innovation( GPS/GIS map, travel integration, etc) ecosystem around it. With so much talk about venture money chasing deals stable investments like these will make venture ecosystem sustainable. This will be the McDonalds of emerging India.

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