EV charging stations: Perks or necessities for commercial real estate owners?

Listen to this article

With 30 convenience stores across the Greater Rochester area and stretching into the Southern Tier, Quicklee’s sells a lot of gasoline.

But while fueling services bring a significant percentage of customers to the stores, the Avon-based company has begun catering to another sector of the transportation industry.

Quicklee’s has installed level 3 electric vehicle charging stations at three locations and is considering further expansion as EVs become more popular. As the quickest way to recharge, the chargers are putting the quick in Quicklee’s.

“We have to be aware of what the trends are, what the future looks like,” said Ken Perelli, vice president and chief operations officer at Quicklee’s. “As much as I don’t believe fossil fuel will disappear in the next 10 or 20 years, I am aware of changing perceptions.”

That’s why Quicklee’s partnered with Power Management Co., LLC of Victor, a third-party energy broker, on an installation and purchase strategy, selecting locations in high-traffic areas that are convenient to major roadways.

They chose the new Batavia location just off the New York State Thruway at exit 48 and their travel centers in Avon along Interstate 390 and in Belmont along Interstate 86.

Level 3 chargers also may be added to the store on Lehigh Station Road in Henrietta near Interstate 390 and on the new Porter Road location in Niagara Falls just off Interstate 190.

“Generally speaking, there’s not enough infrastructure in the ground today to support EVs specific to long-range travel,” Michael Hedges, vice president of sales for Power Management, said. “The market is underserved and there’s huge opportunity.

“If there’s as charging station available in Batavia along the Thruway, and there are other amenities like fast food and prepared foods, then it’s going to drive more traffic to the chargers.”

And for Quicklee’s, that’s the whole point of providing whatever fuels a vehicle, whether it’s a petroleum product or electricity.

“Petroleum is a traffic-driver,” Perelli said. “How do we get customers on site, to continue to use the amenities? People are still going to need their Monster energy drinks, they’re still going to play the lottery.”

Rather than wait for the time when EVs make up a most considerable percentage of vehicle traffic, the company is being proactive.

Owners of commercial real estate should be thinking the same way, Hedges said. Charging stations can bring people into shopping areas or restaurants, and they also are reasons why drivers select a particular hotel.

“People may say, ‘We need to charge, let’s go have lunch,’ ” said David Keefe of Greater Rochester Clean Cities. “It does have an appeal from a business development standpoint.”

For Indus Hospitality Group of Penfield, charging stations are now part of the planning process for new hotels.

“In many ways it’s hard not to believe it’s part of the future of hotel travel,” Indus CEO Jett Mehta said. “It’s certainly becoming a hotel standard with the big brands and we’re totally embracing it.”

Because hotel guests are staying overnight, level 3 chargers aren’t a necessity. There is no urgency to charge to full. But level 1 or level 2 chargers aren’t much different than a free breakfast and pool when it comes to the list of hotel amenities.

“Not every hotel has them so when you do have them, you hope you have exceeded your guest expectations,” Mehta said. “And if we make life easier for our guests, we’re all about it.”

Current incentives through federal and state tax credits, as well as utility rebates, could make installation an attractive option, Hedges said.

At first glance, the strategy seems a little counterintuitive for Quicklee’s. Petroleum sales comprise approximately 75 percent of the company’s gross revenue. “But it’s a small percentage of net revenue,” Perelli said. “Prices fluctuate but the margin doesn’t.

The typical Quicklee’s customer is on the premises for five to 10 minutes, Perelli said. It’s even less for someone just buying gas. So even with a Level 3 charger, the customer is spending 20 to 40 minutes at the store, plenty of time to grab a bite to eat or get a little work done on the laptop or tablet.

Owners of multifamily properties and employers also may want to consider the installation of EV chargers.

“You come into work, charge for eight hours or top off your car, that’s an important benefit,” Keefe said.

It’s also perhaps an added perk that may help attract young talent, Hedges said. For multifamily property managers, it could become a requisite as potential EV-owning tenants look for a place to live.

“You’re future-proofing your business,” Hedges said.

Indus Hospitality is taking that a step further when building new properties. They’re running conduit into other areas of the parking lot just in case the need for chargers grows in the future. The company also is running conduit to the roof, should a decision be made to add solar panels in the future, Mehta said.

That idea of future-proofing is precisely why Quicklee’s made the move to add charging stations. Customers pay to plug in, but not that much. For most, the cost to charge back up to 60 or 70 percent capacity is less than the cost for a tank of gasoline.

Thus, level 3 charging stations are essentially loss leaders for the Quicklee’s. Not only must the company pay for the usual electric usage, but the charging stations trigger the electric company’s high-demand surcharge on the monthly billing cycle. That’s because most charging takes place when all other operations of the store are at their highest level.

“It’s not a revenue-generating amenity, it’s more of a convenience amenity,” Perelli said. “But we want to be a company that acknowledges changes are happening and that our customer base is going to be changing.

“We’re a family operated business, we care about the environment and green-based initiatives. As a petroleum-based business, yeah, we can adapt. We’re all going to have kids and grandkids and great grandkids.

[email protected]/(585) 653-4020