The big dealers get bigger
21 December 1998
Capital Automotive REIT Signs Definitive Agreement to Acquire Six Dealership Properties from an Affiliate of Lithia Motors MCLEAN, Va., Dec. 21 -- Capital Automotive REIT
today announced that it has signed a definitive purchase
agreement with Lithia Properties, LLC, an affiliate of Lithia Motors, Inc.
to purchase the property of six dealerships for approximately
$17.8 million in cash.
The six properties are located in Medford and Grants Pass, Oregon,
totaling 19.62 acres. These properties include 15 franchises representing 10
automotive brands, including Honda and Toyota. Lithia Motors, headquartered in
Medford Oregon, is the nation's 19th largest auto retailer. The company sells
and services 23 brands of new and used vehicles from 28 dealerships in Oregon,
California and Nevada.
Thomas D. Eckert, president and chief executive officer of Capital
Automotive REIT, stated, "This transaction is indicative of our strategy to
partner with the highest quality dealer groups in the country. This
relationship with Lithia, who is among the nation's largest and most
successful dealer groups by every measure, provides us additional growth
opportunities and reinforces that our REIT concept is compelling to dealers
looking for additional alternatives to finance growth. In addition, this
transaction demonstrates our strategy of geographic diversification as it
marks Capital Automotive's entrance into the Oregon market."
Sidney DeBoer, chairman and chief executive officer of Lithia Motors, and
managing member of Lithia Properties, LLC, added, "We are pleased to partner
with Capital Automotive, who has demonstrated its unequivocal competitive
advantage and commitment to relationship-driven, value-added transactions.
This mutually advantageous relationship is the first step in what we see as a
long, prosperous alliance."
Capital Automotive currently owns 113 properties, including 137 automotive
franchises representing 35 brands in 18 states. Capital Automotive's
$487 million portfolio includes a total of 4.1 million square feet of
dealership buildings on 663 acres of property. The properties are leased on a
triple-net basis to 28 dealership groups, eleven of which are among the top
100 dealer groups in the country according to Automotive News.
Capital Automotive REIT, headquartered in McLean, Virginia, is the first
self-administered, self-managed real estate investment trust formed to acquire
the real property and improvements used by operators of multi-site,
multi-franchised motor vehicle dealerships and motor vehicle related business.
Additional information on Capital Automotive REIT is available on the
Company's website at http://www.capitalautomotive.com.
The matters discussed in this press release include forward-looking
statements. In addition, when used in this press release, the words "intends
to," "believes," "anticipates," "expects," "pro forma" and similar expressions
are intended to identify forward-looking statements. Such statements are
subject to a number of risks and uncertainties. Actual results in the future
could differ materially and adversely from those described in the
forward-looking statements as a result of various important factors, including
the general economic climate, the supply of and demand for automotive
properties, interest rate levels, the availability of financing, and other
risks associated with the acquisition and leasing of properties, including
risks that the tenants will not pay rent or that operating costs may be
greater than anticipated, acquisitions that are pursued by the Company may not
be consummated for a variety of reasons, including the failure to reach
agreement with the seller and the other risk factors set forth in the
Company's filings with the Securities and Exchange Commission. The Company
undertakes no obligation to publicly release the result of any revisions to
these forward-looking statements that may be made to reflect any future events
or circumstances.
