Chicago’s $1 Billion Parking Meter Gamble: A Deal That Keeps Costing the City

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Chicago was in financial turmoil, and Morgan Stanley’s group of investors swooped in with an offer. In exchange for $1.15 billion, the investors would control the revenue from Chicago’s parking meters for 75 years. Desperate for cash, the city agreed.

Immediately after the deal was signed, parking prices in Chicago surged. What used to be affordable suddenly became one of the most expensive parking systems in the country, and Chicagoans felt the impact.

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The deal had strings attached. If Chicago wanted to hold a parade, remove a parking spot, install a bus stop, or limit access to a parking meter for any reason, the city would have to pay the investors the value of the meter. By 2023, Chicago had paid the group $79 million in such fees.

By early 2023, the investors had already made back their $1.15 billion investment, plus an additional $500 million, with 61 years left on the deal. Chicago was locked into a bad contract that would continue draining its resources for decades.

Even though the city regretted the deal, there was no way out. The contract locked Chicago into decades of high parking fees and constant payments to the investors for using its own infrastructure.

Half of Chicago’s parking meters are now owned by the Abu Dhabi Investment Authority, with the other half controlled by a mysterious company named Boma. The city’s streets are no longer fully under local control, adding another layer to the complexity of the deal.

With the investment group already having made a huge profit, Chicago still faces 61 more years of payments and restrictions. Chicago’s parking meter deal may have seemed like a quick fix during a financial crisis, but it turned into a long-term burden that the city will continue paying for decades. With soaring parking prices, millions in fees, and ownership in the hands of foreign investors, this deal serves as a cautionary tale for cities looking to solve short-term problems with long-term consequences.

Stay tuned,

BREEFX ✨

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