KKR, Morgan Stanley to Bid on New Jersey Parking Lots

New Jersey Transit Corp., operator of the third-largest U.S. public bus and rail system, selected seven teams, including ones led by KKR & Co., Morgan Stanley and Macquarie Capital, to bid for rights to lease the agency’s parking lots.

The seven teams were chosen from 10 that applied, said Penny Bassett Hackett, a New Jersey Transit spokeswoman. Others named include Cintra Concesiones de Infraestructures de Transporte SA, JPMorgan Chase & Co. and Carlyle Infrastructure Partners. Parking facilities include those in Princeton Junction, Hamilton and a 3,718-space garage at the Metropark rail station in Woodbridge.

The teams will bid in March on how much they would pay New Jersey Transit for the right to operate and retain revenue from 81 parking lots and structures for 30 to 50 years. James Weinstein, New Jersey Transit’s executive director, plans to discuss the bidding at the agency’s regular board meeting in Newark Dec. 9, Bassett Hackett said.

Indianapolis, Pittsburgh and Los Angeles are also considering parking leases to raise money for budgets starved by a decline in general-fund revenue that was the largest since 1986 in the year that ended in June, according to the National League of Cities.

“It’s critical that we pursue innovative ways to improve parking for customers while addressing the growing cost of operating parking facilities,” Weinstein said in an e-mailed statement.

Confirming Interest

Paula Chirhart, a spokeswoman in New York for Sydney-based Macquarie Group Ltd., confirmed her company’s involvement and declined to comment further. Michelle Ong, a Carlyle spokeswoman in Washington, declined comment. Kristi Huller of KKR in New York didn’t have an immediate comment when reached today by telephone.

Erica Platt of Morgan Stanley declined to comment. Justin Perras of JPMorgan and Patrick Rhode of Cintra, a unit of Madrid-based Ferrovial SA, didn’t immediately respond to messages seeking comment.

A team comprised of Morgan Stanley, Allianz Capital Partners and the Abu Dhabi Investment Authority paid Chicago $1.15 billion in 2008 for a 75-year parking-meter lease. The partners may earn a profit of $9.6 billion before interest, taxes and depreciation over the life of the contract, documents filed for a July sale of notes show. So-called Ebidta is a measure used by analysts and investors to evaluate infrastructure leases, according to the documents. Other costs may affect the eventual profit.

To contact the reporter on this story: Dunstan McNichol in Trenton, New Jersey, at dmcnichol@bloomberg.net.

To contact the editor responsible for this story: Mark Tannenbaum at mtannen@bloomberg.net.

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