Parking Asset Due Diligence Explained, With Checklist

Due diligence is a critical part of the process to acquire a parking asset, but it’s not as difficult or complicated as most buyers think. While some buyers choose to partner with a consultant or advisor for due diligence, the process can often be handled independently or in conjunction with the right parking management partner. To do it right, potential buyers should know key areas to research, which questions to ask, and the most crucial data to review. Skipping or rushing any step can expose you to unforeseen liabilities or missed opportunities.

In this article we provide both a broad overview and a detailed due diligence checklist - broken down by section (e.g., financial, operational, legal, etc.) - to help guide and prioritize the steps in your process.

Due Diligence Process Overview

The due diligence process is designed to help you verify seller claims by checking legal records, reviewing financial reports, evaluating operational risks, inspecting the asset condition, assessing value, projecting revenue, and more. The purpose is to provide you a full picture of a property to confirm that it aligns with your expectations and investment goals.

It’s also the time period in which to uncover any potential red flags, from legal or zoning issues to maintenance problems or financial underperformance. A thorough review helps you understand the real value of the asset and gives you the confidence to move forward or walk away if needed. Due diligence is typically divided into several key phases, each focusing on different aspects of the asset.

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Having a plan and sticking to a timeline is just as important as asking the right questions. Most deals give buyers around 30 days to complete formal due diligence after an offer is accepted. This is usually enough time if you’ve clearly prioritized the steps, though more complex properties might take longer. The facility’s size, condition, ownership structure, or unusual lease or contract terms can all affect due diligence complexity. If more time is needed, it’s common for buyers and sellers to agree on extensions.

The best approach is typically to start with the fundamentals like ownership and legal status, financial records, physical condition, and existing contracts. Then you can dig deeper into operations, technology, and market context.

Parking Asset Due Diligence Checklist

1. Legal and Regulatory

Goal: confirm that the property is in proper legal standing, accurately permitted, and free from issues that could limit future operations.

• Who legally owns the asset? Is the title clear of liens, disputes, or encumbrances?
• Are all required permits, licenses, and certificates in good standing?
• Is the current use of the property compliant with local zoning laws?
• Are there any legal restrictions affecting operations or future improvements?
• Are there any pending or past lawsuits related to the property or operator?
• Are easements or access rights documented and understood?

2. Financial Performance Analysis

Goal: assess the asset’s income, expenses, and long-term value through analysis of financial records, projections, and capital needs.

• Can the seller provide full financial statements for the last 3–5 years?
• Is revenue attributable by source (e.g., daily parkers, monthly leases, events, etc.)?
• How do expenses break down across operations, staffing, maintenance, and technology?
• Are financial projections supported by realistic assumptions?
• Are there tax returns and historical budgets to compare against?
• What capital expenditures have been made recently, and what is expected to be needed soon?

3. Physical Asset Inspection

Goal: verify the condition of the property and parking equipment; identify any safety, maintenance, or environmental concerns.

• What is the condition of the structure, pavement, and striping?
• Is there potential to upgrade existing parking equipment to better solutions? gates, ticketing equipment, and pay stations in good working order?
• Are there deferred maintenance issues or repairs that should be addressed?
• Has an environmental site assessment (e.g., Phase I or II ESA) been completed?
• Does the site meet ADA and local safety compliance standards?
• Has the asset been professionally appraised?
• Does the site layout support good traffic flow, visibility, and safe pedestrian access?
• Are ingress/egress points efficient and compliant?
• Is lighting, signage, and wayfinding clear and functional?
• Do utilities function as expected?
• Is there proper electrical infrastructure to add EV charging capabilities (i.e., voltage capacity for Level 2 or Level 3 chargers)? 

4. Lease and Tenant Review

Goal: understand existing lease agreements and tenant relationships to evaluate income stability and potential limitations.

• Are there any third-party leases in place (e.g., valet companies, commercial tenants, etc.)?
• What are the terms of those leases, and do they include renewal options or exclusivity clauses?
• How stable is the rental income from these tenants?
• Do any leases or contracts include terms that would complicate resale or future redevelopment?

5. Operational Review

Goal: understand how the facility runs day to day, including management practices, enforcement, occupancy trends, customer experience, and any pain points.

• Who currently manages the facility? Are they under contract, and what are the terms?
• What is the average daily occupancy and revenue by time, day, and month?
• Are monthly parkers, event-based agreements, or hotel/retail validations part of operations?
• How is enforcement handled? Are there records of violations or complaints?
• How are technology systems (e.g., license plate recognition, mobile pay) integrated into daily operations?
• Are there recurring customer issues or operational bottlenecks?

6. Market and Location Analysis

Goal: evaluate the property’s potential within the local market, including competitive positioning, demand drivers, and future risks.

• How does the facility perform compared to similar assets in the area?
• What demand drivers are present, like offices, events, nightlife, tourism, or residential buildings?
• What are competitors charging, and how full are their lots?
• Are there upcoming zoning changes, construction projects, or policy shifts that could impact demand?
• What is the future development outlook for the area?

7. Final Review and Closing Preparations

Goal: collate your findings, resolve open issues, and ensure you're ready for a smooth closing.

• Have all findings been compiled into a summary report for investment committee or internal review?
• Do the findings support the original valuation, or should price adjustments be negotiated?
• Are there unresolved contingencies (e.g., financing, contract assignments, third-party approvals)?
• Is there a closing checklist to ensure a smooth transaction?

Partner with a Parking Management Provider

Done right, due diligence should help you confidently confirm an asset’s upside potential and ensure that it’s legally, financially, and operationally sound. A parking management partner like AirGarage can help you during due diligence and post-purchase through implementing the right technology and management approach to hit revenue and performance goals. Because we’re incentivized through revenue-sharing agreements, we also benefit when our partners find and invest in assets with the potential for long-term success. Our goal is to help you (as the buyer) fully understand the asset’s value, risks, and operational realities before completing the acquisition.