However, council city property manager Robert Clark says the move "makes commercial sense", and could yet be followed by similar deals.
Wilsons Parking took up a commercial lease for the council-owned YMCA car parking building in upper Moray Pl on October 1.
Mr Clark told the Otago Daily Times the deal meant the company would pay the council about $450,000 a year to operate the public car park, before striving to generate its own profit on top.
The council's citipark staff had previously managed the building, generating a profit of $64,200 in the last financial year, he said.
It was one of four council-owned parking buildings, but the only one of the four to generate a profit in recent years, council development services manager Kevin Thompson confirmed yesterday.
Mr Clark said the lease agreement meant the council would be $210,400 better off in the first year, and $230,400 in years two and three, excluding GST.
A condition of the contract prevented the company from raising hourly parking fees without council approval, but allowed for fees for leased parks to rise in the future, if the company so decided, he said.
There were no plans to do so at this stage, he said.
Wilsons had previously managed council car parks, including the former council-owned building in Filleul St, but under a management agreement - rather than a commercial lease - that saw revenue divided between the parties, he said.
"It can be a variable situation," he said.
He had been in talks with the company for more than a year about "various transactions", leading to an offer put forward by the company and taken to the council's property subcommittee, Mr Clark said.
The company was interested in other parking opportunities in the city - and elsewhere in New Zealand - but there were no plans to lease the other three council-owned buildings "at this stage", Mr Clark said.
"There may be a case for the others, but they're all different, in different locations, and have different rentals and have different . . . usage levels.
"We will look at them over a period of time, but we would want to see how this one works first."
Mr Thompson said the other three buildings had been running at a loss in previous years, while providing a "public good", but were ahead of budgets in recent months.
The Great King St parking building was $13,000 (or 14%) ahead of its budget for July-August, while the lower Moray Pl building was $3000 (7%) ahead, and the Wall St building $12,000 (29%) ahead, figures showed.
He could not say yesterday whether hitting budgets would see the buildings run at a profit or a loss, with detailed forecasts for the buildings for the rest of 2011-12 not immediately available.
However, overall budgets including the buildings - and the council's 12 other off-street parking areas - forecast total revenue of $2.476 million for 2011-12, and expenditure of $2,388 million, meaning a small profit of $88,000, he said.
