Ohio Uni taps seven for $375m parking mandate

The university has shortlisted the likes of Alinda, Carlyle, IFM, Macquarie, Ontario Teachers’, KKR and Queensland Investment Corporation for a proposed 50-year parking lease mandate.

Upon evaluating 10 responses from a Request for Qualifications (RFQ) that closed on November 2, Ohio State University (OSU) has narrowed its list of contenders gunning for the right to lease the school’s parking facilities to seven. 

The shortlist, which pairs financial sponsors with parking lot operators, includes:
  
Alinda & InterPark; 
Carlyle Infrastructure Partners & Standard Parking; 
Industry Funds Management & Parking Solutions; 
Macquarie Capital & Central Parking; 
Ontario Teachers’ Pension Plan & Imperial Parking; 
Kohlberg Kravis Roberts & Ampco/ACS; 
Queensland Investment Corporation Private Capital and LAZ Parking.

OSU’s proposal remains a consideration at this point and would be the first time a US public university would allow private investor participation for an on-site parking establishment.  

The parking lease represents a long-term commitment of 50 years and the winner will provide at least $375 million in upfront capital. Also included in the financial terms is a cap on future parking rate hikes of up to 7.5 percent for the first decade. After the initial 10-year term, the private operator can raise rates annually by either 4 percent or by the percentage increase in the US Consumer Price Index – a popular inflation indicator – whichever is greater.

If OSU decides to move forward with the plan, the winner need not await board approval before making its investment.

Throughout the next stage of the selection process, candidates will be invited to the campus for interviews and the further unfolding of due diligence by OSU. Once those meetings conclude, the bidding becomes more competitive. 

“The number of bidders likely will be reduced after the interview process and, assuming we decide to proceed, we will issue the final RFP [Request for Proposals] in the first quarter of 2012,” said Geoff Chatas, OSU senior vice president and chief financial officer, in a statement.

The university, which houses some 82,000 students, is being advised by Morgan Stanley, Jones Day and Desman.