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MCLEAN, VA-Capital Automotive REIT, a specialty finance company for automotive retail real estate, has gotten a new investor. Representing a group of institutional investors of four individual funds, Parsippany, NJ-based Prudential Real Estate Investors has claimed a portion of the McLean, VA-based REIT with the purchase of $150 million in preferred equity interest.

The investment is related to the merger--approved by CARS common shareholders early last week and then completed by week's end--in which investors managed by real estate investment management services provider DRA Advisors LLC of New York City acquired CARS in a transaction valued at $3.4 billion.; the price tag on the deal, which included the assumption of series A and B cumulative redeemable preferred shares, consisted of the $38.75 per-common share cash payment totaling $2.3 billion, as well as the assumption of $1.1 billion in existing debt comprised of long-term mortgage and unsecured debt.

"Automobile dealerships are traditionally extremely stable businesses with diverse revenue streams," Steve Vittorio, a PREI's capital markets team principal, says. "That stability, combined with CARS' proven strategy of targeting multi-site, multi-franchise large automotive groups, gives our investors the opportunity to tap into a significant real estate opportunity." CARS has a portfolio of approximately 360 properties in major metropolitan areas of 32 states. As per CARS' third quarter 2005 financial results report, the REIT's real estate investments total more than $2.5 billion. As part of PREI's investment deal, the company, which is Prudential Financial Inc.'s real estate investment management and advisory division, has the option of expanding its planned $150-million investment by as much as $165 million.