The City of Pittsburgh’s Parking Authority has issued a request for proposals (RFP) to hire a consultant to determine the feasibility of monetising its parking system by leasing out its 11 garages for a specified period.
The RFP follows calls from Pittsburgh Mayor Luke Ravenstahl for the authority to examine whether it could raise revenue for the city’s pension system by leasing out its assets. The city’s pension is only 36 percent funded, according to the mayor’s office.
To date, Chicago is the only major city in the US to have completed a long-term lease of its parking system. In 2006, the city leased its underground parking to a consortium led by Morgan Stanley’s infrastructure fund for $563 million. Last year, the same consortium, 99 percent controlled by Morgan Stanley-affiliated funds, paid $1.16 billion for a 75-year lease of the city’s on-street parking system. The latter was an all-equity transaction.
At a 22 January meeting of the Pittsburgh Parking Authority’s board, executive director Dave Onorato informed board members that “the administration has been contacted by firms offering substantially high dollar amounts in return for leasing authority assets for a specified period,” but did not discuss specific amounts, according to board minutes.
The Pittsburgh Post-Gazette has previously reported that a long-term lease of the city’s parking garages could infuse $300 million into the city’s pension after the authority’s $108 million in debt is paid off.
The feasibility study carried out by the eventual winner of the RFP would be the first step toward that process. Interested parties have until 20 March to respond.