Chicago greenlit the transfer of the long-term lease covering 36,000 parking meters to Stonepeak for $2.5 billion. The sellers are a Morgan Stanley-headed consortium that counts Allianz SE and the Abu Dhabi Investment Authority among its members. That consortium originally paid $1.15 billion in 2008 for a 75-year lease, a deal that has drawn public criticism ever since.
To get the latest agreement over the line, the council secured extra payments. The package includes one $75 million check to the city, a 2% fee paid to Chicago if the lease is sold again later, and a continuing 5% share of calculated net income from the meter system. City officials plan to direct these proceeds to help address pension shortfalls.
Chicago retained the ability to veto a transfer under the 2008 contract in specific cases, such as if a sale would saddle the city with a tax bill or if the incoming owner raises red flags about financial capacity, reputation, or honoring the agreement. The approval navigates months of political tension tied to the meter lease that traces back nearly 20 years to the Great Recession era. At prior hearings, several aldermen pressed Stonepeak to divest from Omni Air International, a carrier that performs deportation flights for the US government. Over the summer, Stonepeak informed the council it was evaluating a transaction, and this week Air Transport Services Group, owned by Stonepeak, announced it had agreed to sell Omni.
Scott Waguespack, who helped negotiate the ordinance and was among the few who opposed the 2008 lease, said, "This is the best deal we could get on the table." Stonepeak, based in New York, welcomed the vote, saying in a statement that it is "committed to serving as a cooperative and transparent long-term partner to the City of Chicago and its residents on this important infrastructure asset."
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The city just locked in fresh near-term cash and a small ongoing revenue cut tied to an asset Chicago does not operate day to day. If those dollars actually flow to pensions as planned, it could help stabilize long-term obligations without new taxes, which matters to anyone living, working, or investing in Chicago. Watch both for any future sale that would activate the 2% fee and for the year-by-year 5% cut of calculated net income to see how it pans out.
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