Capital Automotive Closes $65.3 Million in Acquisitions
18 November 1999
Capital Automotive Closes $65.3 Million in Acquisitions
Adds Thirteen Properties, Sixteen Franchises in Five States
McLEAN, Va., Nov. 18 -- Capital Automotive REIT
today announced that it has closed approximately
$65.3 million of acquisitions during the first half of the fourth quarter
1999. Consideration for the acquisitions was approximately $51.7 million in
cash and $13.6 million in operating partnership units. The cash was funded
primarily from cash-on-hand. The operating partnership units were priced at
$13.12 per share. The acquisitions included 13 dealership properties in five
states representing 16 franchises, and totaling approximately 57.75 acres and
approximately 522,000 building square feet. The average initial lease term
for these acquisitions is 14.2 years, with multiple five and ten-year renewal
options. Cap rates were consistent with the Company's business plan. All but
four of the properties have been leased to existing Capital Automotive
tenants. Significant transactions are listed below and virtual tours of the
majority of these properties can be viewed at http://www.capitalautomotive.com .
-- Four properties from the Miller Automotive Group in Salt Lake City,
Utah, totaling 10.42 acres and 201,763 building square feet, for
approximately $16.2 million. Miller Automotive Group operates four
franchises on the properties including Toyota, Buick, Kia, and Pontiac.
Mark Miller Toyota has won Toyota's Presidents Award seven times. Mark
Miller Pontiac has been a Pontiac Master Dealer for thirteen years.
Mr. Miller has received numerous awards including the AIADA/Sports
Illustrated All Star Dealer Award and the Time Magazine Quality Dealer
Award.
-- Two properties from the Bohn Automotive Group in New Orleans,
Louisiana, totaling 17.25 acres and 103,915 building square feet, for
approximately $14.8 million. The properties have been leased to Group
1 Automotive , which operates four franchises on the
properties including Ford, GMC, Pontiac, and Toyota.
-- Three properties from the Freeland Group in Fort Myers, Florida,
totaling 16.2 acres and 69,496 building square feet, for approximately
$13.1 million. These properties have been leased to Sonic Automotive
, which operates four franchises on the properties including
Honda, BMW, Nissan, and Mercedes Benz.
-- Two properties from the Kramer Automotive Group in Santa Monica,
California, totaling 1.72 acres and 48,788 building square feet, for
approximately $9.6 million. These properties are leased to First
America Automotive who has recently signed a definitive contract to be
acquired by Sonic Automotive. First America operates two franchises on
the properties including Honda and Volvo.
-- One property from Park Place Motorcars in Dallas, Texas, totaling
8.92 acres and 71,572 building square feet. Park Place operates a
Mercedes Benz franchise on the property. Park Place currently leases
four other properties from Capital Automotive.
-- One property from an affiliate of Asbury Automotive in Jacksonville,
Florida, totaling 3.24 acres and 16,400 building square feet for
approximately $2.5 million. This property has been leased to an
affiliate of Saturn Corporation. Saturn Corporation guarantees the
lease.
Thomas D. Eckert, president and chief executive officer of Capital
Automotive, stated, "These acquisitions clearly demonstrate our ability to
continue to execute our business plan and to facilitate the expansion plans of
our existing tenants. We continue to pursue high-quality acquisitions by
capitalizing on our strong relationships and competitive position. We have
strengthened our portfolio by diversifying our tenant base and creating
additional geographic and franchise diversification. We are also pleased to
announce the issuance of $13.6 million of operating partnership units. All of
these transactions are highly accretive, and we remain very optimistic about
our future."
As of November 17, 1999, the Company's $929 million portfolio included
229 properties, including 348 automotive franchises in 27 states. These
properties total 8.0 million square feet of buildings and improvements on
1,286 acres of land. The properties are leased under long-term, triple net
leases with an average initial lease term of 13.3 years. The Company has
entered into transactions with 16 of the top 100 dealer groups in the
country -- 15 of which are tenants. Approximately 65% of the Company's
annualized rental revenues are derived from this group of tenants. As of
November 17, 1999, the Company's portfolio weighted average initial cap rate
is 10.5%.
Capital Automotive, headquartered in McLean, Virginia, is a
self-administered, self-managed real estate investment trust formed to acquire
the real property and improvements used by operators of multi-site,
multi-franchised automotive dealerships and related businesses. Additional
information on Capital Automotive is available on the Company's web site at
http://www.capitalautomotive.com .
To receive Capital Automotive's latest news and corporate developments via
fax at no cost, please call 1-800-PRO-INFO; use Company code CARS. Or visit
The Financial Relations Board's web site at http://www.frbinc.com .
Certain matters discussed within this press release are forward-looking
statements within the meaning of the federal securities laws. Although the
Company believes that the expectations reflected in the forward-looking
statements are based upon reasonable assumptions, the Company's future
operations will depend on a number of factors that may differ, some
materially, from the Company's assumptions. These factors, which could cause
the Company's actual results to differ materially from those set forth in the
forward-looking statements, include risks that the Company's tenants will not
pay rent or that the Company's operating costs may be higher than expected,
risks of interest rate fluctuations impacting future acquisitions, risks that
additional acquisitions may not be consummated, environmental and other risks
associated with the acquisition and leasing of automotive properties and those
risks detailed from time to time in the Company's SEC reports, including its
annual report on Form 10-K and its quarterly reports on Form 10-Q.