HedgeCo.Net — Stonepeak has completed its acquisition of Chicago Parking Meters LLC, the operator of the City of Chicago’s on-street parking system, from a consortium of Morgan Stanley Infrastructure Partners, Allianz and a wholly owned subsidiary of the Abu Dhabi Investment Authority. The infrastructure investor announced the closing on October 21, after receiving all regulatory approvals. The Chicago City Council approved the transfer on September 29 by a 46-3 vote, and the city’s Council Office of Financial Analysis identified Stonepeak’s winning bid as $2.53 billion.
The concession covers more than 38,000 metered parking spaces, including nearly 10,000 in downtown Chicago. The asset dates to a 75-year lease the city signed in December 2008 for an upfront payment of $1.15 billion, which took effect in February 2009 and runs through 2084. According to the council’s analysts, the operator recovered its initial investment by 2018 and has generated roughly $2.16 billion in meter revenue to date. This is the first change of ownership since the deal began.
Winning approval required new terms for the city. Under a third amendment to the concession, Chicago receives a $75 million payment at closing, an annual profit share equal to 5% of calculated net income, and 2% of the price of any future approved transfer. The amendment also expands the number of special events the city can hold without paying compensation for meters taken out of service, a cost that had totaled nearly $174 million through 2025, according to the Chicago Sun-Times.
For the sellers, the exit marks a full cycle on one of the most debated public-private partnerships in the U.S. Morgan Stanley Infrastructure Partners said it had grown the business into a leading parking concession through investments in technology and operations, including electronic pay stations and the ParkChicago app. Evercore advised the selling consortium.
The deal shows why long-dated, inflation-sensitive concessions remain prized by infrastructure funds even when they carry political risk. Stonepeak is paying more than twice the original upfront price for the nearly six decades left on the lease, while accepting revenue sharing and transfer terms that the original owners never had. Other city governments considering asset monetizations are likely to note that Chicago used the transfer approval as leverage to reopen the economics.