| Abstract: | Although parking revenue is a principal source of income, supply of parking infrastructure at airports is based largely on expected needs. Although that is a rational basis, high investment costs and management fees are requiring developers and financiers to carefully analyze investment risks. This paper focuses on sources of investment risk in airport parking infrastructure development and discusses the application of Monte Carlo simulation to estimate and understand the impacts of cash flow uncertainties on project feasibility. It is shown that cost overruns, which are common in construction project development, have the most significant impact on return risk. |
