What Tesla’s Supercharger Pullback Means for Commercial Real Estate Owners

The EV market undoubtedly witnessed some shake ups in the first half of 2024.

Tesla made headlines with its slowing of investments in EV infrastructure, laying off a portion of its Supercharger team, and most recently, plummeting profit growth. This caused a massive stir about the future of EV charging infrastructure, especially for public charging stations.

But Tesla’s decisions didn’t leave the EV market in peril. In fact, EV sales in the second quarter of 2024 hit a new record high and an 11.3% increase year-over-year. Prediction data also remains optimistic that nearly half of all auto sales will be EVs by 2030.

As a commercial real estate owner, you might be wondering, “What does this have to do with my properties?” Surprisingly, the answer is: quite a lot. Tesla’s Supercharger pullback, coupled with the ripeness of the EV market presents you with a unique opportunity to help fill the charging infrastructure gap, and in tandem, motivate more drivers to adopt EVs.

How CRE Owners Can Help Fill the Tesla Supercharger Gap

There’s a perfect storm happening in the EV market that commercial real estate owners can take advantage of:

• EV sales continue to grow while the average cost of electric vehicles continues to drop.
• The pool of used EVs continues to grow (also with average costs dropping), with prediction data forecasting 2024 growth by roughly 100%.
• Government mandates continue to put pressure on CRE owners to show sustainability progress.
• Rebates and grants are in abundance, helping to reduce the cost of charging installation.

Tesla’s Supercharger pullback only added to this storm, creating a surge of questions around demand for conveniently located charging stations, and the answer is simple – at your properties.

In a market where convenient charging is becoming increasingly important, offering on-site charging can give your CRE properties a significant edge over competitors.  This can be especially beneficial for properties like multifamily communities, shopping centers, hotels, and workplace buildings where attracting tenants, visitors, and shoppers who are more likely to pay more and spend more time is a top priority.

What Are the Benefits of Installing EV Chargers at My Properties?

Property owners have the unique opportunity to be a driving force to motivate more people to adopt EVs by adding chargers in their living communities, workplaces, or retail locations. For drivers who do not have access to convenient at-home charging at a single-family home, charging availability remains a major roadblock for EV adoption. Tesla Superchargers were an enabler to convince more drivers that EV was a viable option, and with the future of Superchargers a bit unclear, property owners can step in to be part of the solution.

By installing EV charging infrastructure, you can transform your properties into a magnet for tenants and customers, future-proofing your investment and reaping a host of benefits.

Regardless of your asset class, the benefits of installing EV chargers at your properties are clear:

• Multifamily communities: Capture sustainability-minded renters, increase rental rates, and reduce parking strain.
• Shopping centers: Become destinations for EV shoppers, extend dwell time, and increase spending.
• Hotels: Cater to eco-conscious travelers, enhance guest experience, and create a new revenue stream.
• Office and workplace buildings: Attract and retain eco-conscious tenants, boost employee satisfaction, and productivity.

In addition to the benefits for tenants and visitors of your properties, EV charging also boosts investor confidence. By installing charging infrastructure, you can demonstrate a forward-thinking approach, making your portfolio more attractive to long-term investors. Additionally, you’re likely already familiar with pressure to create environmentally conscious properties. Installing EV charging stations showcases your commitment to sustainability, which can be a major selling point for socially responsible investors.

I Was or Was Planning to Work with Tesla…Now What?

If you were planning to partner with Tesla for on-site Superchargers at your commercial real estate property, its slowdown doesn’t have to stall your plans entirely. The most important factor to remember is not to fall victim to a “do nothing” mentality if your Tesla strategy is changing course. Here are some alternative paths to consider:

1. Explore other charging providers

Numerous companies are actively expanding their charging networks. Research these providers and compare their offerings to find one that aligns with your property type, target audience, and budget.

2. Consider grant opportunities

Many government agencies and utilities offer grants or rebates to incentivize the installation of EV charging stations. Look into these programs to help offset the cost of installing your own infrastructure.

3. Work with a turnkey electric vehicle supply equipment partner

An EV charging partner like SitelogIQ will help you with all aspects of your EV deployment strategy, including site selection, budget and design, detailed engineering, procurement, and construction management.

SitelogIQ also takes a solution-agnostic approach, meaning we act as your agent in the marketplace. We’ll sit on your side of the table, navigating through the saturated market of EV charging software and hardware vendors, incentives, financiers, and legal. Let us help you find the best alternative to your Tesla plans, based on your portfolio’s unique needs and goals.