Morgan Stanley to go all-equity for Chicago meters
The City of Chicago and the Chicago Park District have awarded a 75-year concession of the city's on-street metered parking to a consortium led by the Morgan Stanley Infrastructure Fund. The consortium, made of the fund and LAZ Parking, bid $1.57 billion for the concession. According to a source familiar with the deal, Morgan Stanley Infrastructure Fund had lined up Royal Bank of Scotland as its sole debt arranger, but decided against bidding using the debt, and is likely to fund the purchase using all-equity.
Consortiums led by Cintra and Macquarie were also shortlisted to bid. Barclays Capital was said to have been supporting all three bidders but withdrew its commitments shortly before the bids were due. The Cintra consortium was advised by RBC, and was also granted credit approval to lend to the project just before the bids were due, but cited its pricing as around 600bp over Libor, which was significantly higher than the 300bp-400bp margins on other debt offers.
The assets include 106 pay-and-display machines, 31,207 electronic and mechanised single-bay parking meters and 1,427 electronic double-bay parking meters capable of metering approximately 34,399 on-street spaces and 17 metered parking lots containing roughly 1,215 spaces. The Park District assets include five pay-and-display and 327 single-bay electronic parking meters for 547 spaces located in parks near the city's lake-front area.
Morgan Stanley and LAZ won a concession in May 2007 to run four parking garages in Chicago, for an upfront payment of $563 million, for...
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