EV charging stations more than a luxury, now a differentiator
By Cary Stemle
Electric vehicles still account for a small percentage of automobiles on U.S. roads — about 1.13 percent of market share by the end of 2017 — but the growth trend is clearly upward. And that means builders and developers are increasingly compelled by customers to include EV charging stations in their projects.
“When our leasing agent does tours for prospective tenants, they ask, ‘Where am I going to plug in my Prius?’” says Lawry Jones Meister, president of Steaven Jones Development Co. Inc., a Los Angeles-based commercial real estate and property management company that owns 18 creative office complexes in the L.A. market.
California leads the U.S. in EV adoption, so Jones sees the inclusion of charging stations in a forward-looking city like Los Angeles as a competitive imperative.
SJDS’s latest project, an experiential mixed-use complex called INclave that open next year in Marina del Rey, will include 10 EV charging stations in a fully automated parking garage.
“I’m concerned that’s not enough,” Jones Meister says. “The beauty of that parking system is that it’s relatively easy to add EV space in the future.”
Michael Farkas is the founder and executive chairman of the Blink Network, a turnkey EVS provider based in Miami with a focus on parking garages in major U.S. cities.
EV charging stations have been on the commercial real estate radar for a while now, but Farkas said he’s getting far more calls lately from property owners and managers who are looking to add them. Some are acting on their own, he says, while others are being nudged by tenants.
“We’re seeing a lot of new construction integrate EV charging at the planning phase,” he says. “It’s easier and less expensive if you add the conduit and excess panel capacity up front. Copper wire still costs the same, but if you have excess capacity and you’re just pulling wire rather than running conduit, it could be 50 to 60 percent less.”
Farkas said Blink is also seeing “tons of retrofits,” which he says are substantially more expensive. “When we have legacy buildings in urban areas, sometimes we go as far as X-raying buildings to find the rebar and run the conduit,” he says.
There are a couple of models in the vendor space. Blink, for example, owns and operates a network of charging stations, while the largest player in the space, ChargePoint, only provides hardware.
Blink is vertically integrated and can handle everything for a client, but some owners want more control.
“When we partner with a property owner and do a hybrid model, we contribute the hardware and the property owner pays for the installation and then we split revenue,” Farkas says.
A typical charging unit costs about $3,000 to install, Farkas adds, and his firm recommends that clients prepare about 20 percent of a project to accommodate charging stations.
“I don’t say light up 20 percent of spots, but at least have the conduit,” he says. “I’d start small, add a unit or two and see what traction you get. Then, add accordingly.”
While EVs are most common in California, on the East Coast and in cities like Portland and Seattle, Farkas says usage is growing everywhere and that charging networks are “gunning for the gold."
“There’s a reason why oil companies have been the most valuable stocks worldwide,” he says. “That’s what we’re replacing.”
Most EV drivers will charge at home, but with 47 million American households not living in facilities with dedicated parking spaces, Farkas sees revenue opportunities for property owners going forward.
“We feel that going somewhere specific to charge is a dinosaur. Wherever you go will be the place you charge,” he says. “It’s not just an amenity. You can make money. It’s like bringing the gas station to your place.”
Jones Meister, who heads the the L.A. development company, recommends that property owners familiarize themselves with state and local tax incentives for installing charging stations. She also agrees with Farkas about starting small and seeing how it goes.
“Look at your market and look around at how sales of electric cars are going,” she said. “The key for our tenants is getting and keeping their key employees, and we think this gives us a real advantage in leasing.”