- Briefing Room
|Project Sponsor / Borrower||
The Ohio State University
In 2012, the Ohio State University (Ohio State) leased its Columbus campus parking facilities, and management of its daily parking operations, to a private concessionaire as part of an innovative funding strategy. The 50-year agreement generated a $483 million upfront payment that the university has invested in its endowment for scholarships and other initiatives core to Ohio State's academic and research mission.
The concessionaire, CampusParc LP, is a specially formed company controlled by QIC, an Australian investment manager. Operations and maintenance are contracted to LAZ Parking, a Connecticut-based parking operator. Over the lease term, CampusParc is responsible for the operation of Ohio State's parking system which comprises approximately 36,600 spaces across the Columbus campus.
CampusParc's responsibilities include management of the parking permit system, parking enforcement, customer service, motorist assistance, event parking management and parking facility maintenance. CampusParc collects all operating revenue from the parking facilities (parking permit sales and hourly parking fees). Rates increase by 5.5% per year for the first 10 years and 4% per year or the rate of inflation, whichever is higher, for the remaining 40 years. Net revenue from parking citations is returned to the university after operating expenses are deducted.
Ohio State retains the rights to all final policymaking decisions including permit eligibility, rates, space designation and the addition or reduction of available parking, although the university would have to compensate CampusParc if more than 2,200 parking spaces are permanently removed.
CampusParc will have invested more than $34.5 million in major facility repair and upgrade projects in the first seven years of the agreement, including:
Through fiscal year 2019, Ohio State estimates the total value created in its endowment fund from the $483 million upfront payment to be $242 million. Over the 50-year term, Ohio State estimates the value generation to be $3.1 billion. The endowment distributions are being used for student scholarships, hiring new tenure-track faculty, and support for capital projects in the Arts District. Funding has also gone to supporting the Campus Area Bus Service and other initiatives that provide sustainable transportation options. Through fiscal year 2019, $46.8 million in asset-recycling value generated from the lease payment has been invested these transportation services.
$535 million - Total cost to the concessionaire
Concessionaire's original financing structure
Concessionaire's refinancing structure (2013)
|Project Delivery / Contract Method||Long-term Lease Concession (50 years)|
|Project Advisors / Consultants||
To Ohio State University
To the concessionaire
|Duration / Status||
Preferred bidder selected June 5, 2012
OSU Board of Trustees approval June 22, 2012
Concession conclusion 2062
Financial close September 21, 2012
Refinancing close December 19, 2013
QIC refinanced its debt a little more than a year after closing by issuing private placement bonds to repay its bank loan. Initially, it was thought QIC would wait several years to establish a solid track record of operations before seeking a bond issue, but attractive market conditions accelerated that option.
|Related Links / Articles||OSU Administration & Planning article on parking lease and benefits|