Free parking sounds like a guest perk. In reality, it is a hidden subsidy that costs hotels thousands of dollars every month.
That parking lot or garage required land, construction, maintenance, lighting, and insurance. Every space has a real cost whether guests pay for it or not. When you give parking away, you absorb that cost and reduce your overall profitability.
Hotels that charge for parking are not being cheap. They are running a smarter business.
A typical surface parking space costs $5,000 to $10,000 to build. Structured parking runs $25,000 to $50,000 per space. Add annual maintenance, resurfacing, lighting, and liability insurance, and each space costs hundreds of dollars per year just to maintain.
Multiply that across 50, 100, or 200 spaces. You are looking at a significant expense line that generates zero direct revenue when parking is free.
Meanwhile, guests who do not drive still pay the same room rate. They subsidize parking for guests who do. That is not a perk. That is a pricing inefficiency.
Hotel operators worry that parking fees will upset guests or hurt reviews. The data suggests otherwise.
Urban hotels have charged for parking for decades. Airport hotels charge for parking. Resort properties charge for parking. Guests booking these properties expect it.
The key is transparency. When parking fees appear clearly during booking, guests factor them into their decision. Surprise fees at checkout create frustration. Upfront pricing does not.
Business travelers expense parking anyway. Leisure travelers compare total trip cost, not just room rate. Neither group abandons bookings over reasonable parking fees when they know what to expect.
Daily parking fees work for most hotels. Charge a flat rate per night, typically $10 to $30 depending on your market. Urban hotels in major cities charge $40 to $60 or more.
Valet premiums add revenue on top of self-parking rates. Guests pay extra for the convenience of dropping their keys at the door. Valet rates often run $10 to $20 higher than self-parking.
In-and-out privileges matter for guests who plan to use their car during their stay. Include unlimited entries in your daily rate so guests do not feel trapped on property.
Package bundling lets you offer parking as part of premium room packages. Guests who book suites or extended stays get parking included while standard rooms pay separately.
Your hotel parking does not need to serve only registered guests. During low-occupancy periods, empty spaces can generate revenue from outside visitors.
Restaurants and event spaces inside your hotel draw non-guests who need parking. Charge them separately rather than validating for free.
Nearby attractions, offices, or event venues create overflow parking demand. When your lot has capacity, outside parkers represent pure incremental revenue.
Some hotels list available spaces on parking apps during off-peak hours. A space sitting empty at 2pm earns nothing. That same space rented to a downtown worker for four hours earns $15 to $25 with zero impact on guest availability.
Yes, some competitors offer free parking. But competing purely on free amenities is a race to the bottom.
Hotels that charge for parking can invest that revenue into improvements that actually differentiate the property. Better rooms, upgraded fitness centers, improved breakfast options. These drive loyalty more than free parking ever will.
Guests remember great stays. They do not remember saving $20 on parking.
Similar principles apply to restaurants concerned about paid parking. For capturing event-driven demand, explore event parking revenue strategies and dynamic pricing to maximize peak-period rates.