The financing to back DRA Advisor's approximately $3.4 billion acquisition of Capital Automotive REIT launched at a bank meeting in New York last Wednesday. Lehman Brothers is leading the deal, which consists of a five-year, $1.42 billion term loan and a four-year, $250 million revolver. There will also be about $500 million of notes issued around the first week of December. Pricing on both tranches is LIBOR plus 1 1/2%; the revolver is subject to a grid. The acquisition is expected to close at the end of this year or early next year.
Capital Automotive is headquartered in McLean, Va., and is a real estate investment trust focused on automotive dealerships and related businesses. DRA is an investment advisor specializing in real estate investment management services for institutional and private investors. Wachovia Securities acted as Capital Automotives' financial advisor and Latham & Watkins acted as legal counsel. Blank Rome served as legal counsel to DRA. David Kay, senior v.p., cfo and treasurer, could not be reached. Calls to DRA were not returned.