Private equity firm KKR acquired the owner of dozens of near-airport parking lots in the United States in a bet on further growth in the travel industry.
The New York-based firm paid an undisclosed amount for the Parking Spot, a Chicago-based company that owns 47 parking lots near 28 major U.S. airports. The seller was private equity real estate investor Green Courte Partners. Green Courte Partners acquired Parking Spot in 2011 for $360 million.
Parking Spot is the largest operator of near-airport parking lots in the country, according to the company. Travelers typically pay cheaper rates at parking lots located outside an airport’s official grounds when compared to airport-owned parking facilities. Near-airport parking lots can also provide free shuttles to and from airports.
“The Parking Spot has demonstrated a compelling track record of growth and delivery of a high-quality offering to travelers that aligns well with our investment philosophy,” KKR partner Dash Lane said in a statement.
Parking Spot's well-known industry brand with its yellow-and-black logo and recognizable shuttles is expected to continue to grow with KKR’s industry knowledge and substantial resources, according to the statement.
U.S. airlines carried 89.8 million passengers in June, a 2.8% increase from May, the most recent figures available, according to the U.S. Bureau of Transportation Statistics. That level set an all-time high for monthly passenger traffic.
Strong hotel demand
In addition, the summer of 2024 was one of the three-highest since 2000 for U.S. hotel room demand, with about 390 million hotel room nights recorded between Memorial Day and Labor Day, according to Hotel News Now, a division of CoStar News.
Some commercial real estate trends that are affecting the parking industry do not apply to near-airport parking, according to the Near Airport Parking Industry Trade Association. Parking Spot is a NAPITA member.
Outdoor parking lots are the target of redevelopment projects in some cities. In Los Angeles and San Francisco counties and in Chicago, New York and Philadelphia, more parking spaces were sold for redevelopment between 2010 and 2023 than were created, according to CoStar data.
Parking lots are also seen as an obstacle to urban planning that prioritizes higher-density development. In 2022, California approved a law banning minimum parking requirements at new developments within a half-mile of public transit.
Parking Spot earlier this year expanded its holdings with the acquisition of Park ‘N Fly, including a lot at 2741 Camp Creek Parkway in Atlanta. Hartsfield-Jackson Atlanta International Airport is the world’s busiest airport, according to Airports Council International.
The company's portfolio also includes locations near airports in Chicago, Houston, Los Angeles, Phoenix, Pittsburgh and St. Louis.
Parking Spot was founded in 1998. While the company was owned by Green Courte Partners, its portfolio expanded from 17 properties to 47 facilities through acquisitions and ground-up developments, according to the statement.
KKR will look to work with Parking Spot "to further build on their impressive performance and capitalize on the numerous growth opportunities that lie ahead,” Lane said.
For the record
Morgan Stanley was financial adviser to KKR, and Simpson Thacher & Bartlett was its legal counsel. Evercore was the financial adviser to Green Courte Partners, and DLA Piper was its counsel.