Capital Automotive REIT Closes Initial $65 Million in Acquisitions from ARTA Transaction
- Adds 10 Properties Representing 19 Franchises from Three Dealer Groups-
MCLEAN, Va., Oct. 1 /PRNewswire/ -- Capital Automotive REIT (Nasdaq: CARS) today announced the completion of $65.2 million of acquisitions in conjunction with the Company's previously announced agreement with Automotive Realty Trust of America ("ARTA"). Consideration for the acquisitions was substantially all cash. The acquisitions include 10 dealership properties from three dealer groups, representing 19 franchises, and totaling 59.8 acres and 428,000 building square feet. The initial lease term for these acquisitions is 15 years, with multiple 10-year renewal options. Cap rates for these acquisitions are consistent with Capital Automotive's business plan.
These transactions represent the first acquisitions completed in conjunction with the Company's previously announced agreement to purchase properties under contract with ARTA. Of ARTA's $335 million portfolio, Capital Automotive declined to proceed on approximately $110 million of the properties because either the properties or the terms did not satisfy the Company's acquisition requirements. Approximately $49 million of the properties have been withdrawn by the dealers not willing to accept Capital Automotive's amended lease terms. The Company continues to pursue the $110 million balance of the portfolio.
The completed acquisitions announced today include:
-- Three properties from Park Place Motorcars totaling 20.5 acres of land,
located in Houston, Dallas and Plano, Texas. These properties are
tenanted by 2 franchises: Mercedes-Benz and Lexus. Park Place was
founded by Kenneth L. Schnitzer, Jr. in 1987. Mr. Schnitzer, Park
Place's current President and CEO, is a past chairman of the Mercedes- Benz Dealer Council and is a 1998 recipient of the American
International Automobile Dealers Association's All-Star Dealer Award.
Park Place is one of the largest Lexus dealers in the state of Texas
and is a four-time winner of the Elite of Lexus Award. Mr. Schnitzer
was also named a premier Porsche dealer for two consecutive years.
-- Three properties from Momentum Motorcars, based in Houston, Texas,
totaling 19.9 acres. Four franchises operate on the properties
including, Jaguar, Porsche, Volvo and Saab. Momentum Motorcars is
currently under the direction of Ricardo Weitz, who formed the company
in 1991. Momentum Motorcars was the largest Jaguar dealer and the
largest retail BMW dealer in the United States during 1997.
Additionally, Momentum Motorcars was in the top ten of Porsche dealers
in the United States for 1997.
-- Four properties from the Lynn Alexander Automotive Group, totaling 19.4
acres in San Angelo and Big Spring, Texas. Thirteen franchises,
including seven brands, operate on the properties including, Chrysler,
Plymouth, Dodge, Jeep-Eagle, Lincoln Mercury and Nissan. The Lynn
Alexander Automotive Group was founded in 1985 by Lynn Alexander, who
continues to oversee the group's operations.
Thomas D. Eckert, president and chief executive officer of Capital Automotive, stated, "Through our agreement with ARTA we are able to add three distinguished dealer groups to the Capital Automotive portfolio. These transactions complement our diversification efforts by adding high-line import franchises in several new and high-growth Texas markets. In addition, Capital Automotive will retain ARTA's marketing staff providing Capital Automotive with additional acquisition capabilities and a stronger, national marketing network. Our expanding industry relationships, coupled with our financial flexibility, uniquely positions Capital Automotive for future growth and success."
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