Investment risk analysis in airport parking facility development

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