PREI® Acquires $150 Million Stake in Capital Automotive REIT

Business Wire, Dec 22, 2005

PARSIPPANY, N.J. -- Prudential Real Estate Investors (PREI(R)) announced today that it has acquired, on behalf of institutional investors, a $150 million preferred equity interest in Capital Automotive REIT (CARS). PREI invested in CARS as part of a previously announced merger between CARS and entities advised by DRA Advisors LLC. PREI is the real estate investment management and advisory business of Prudential Financial, Inc. (NYSE: PRU).

Under the agreement, PREI could increase its preferred equity stake to as much as $315 million over the next several months. PREI's capital markets group led the investment on behalf of investors in four separate funds. Additionally, common equity holders are investing $867 million in equity and Lehman Brothers is providing an additional $2.4 billion in debt to fund the transaction.

CARS, headquartered in McLean, Va., owns more than 360 properties leased to 60 automobile dealers in 79 metropolitan areas throughout the United States.

"Automobile dealerships are traditionally extremely stable businesses with diverse revenue streams," said Steve Vittorio, a principal with PREI's capital markets team. "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."

PREI's fund management units offer a broad range of investment opportunities and investment management services in the United States, Europe, Asia and Latin America. PREI, headquartered in Parsippany, N.J., managed $27.3 billion for more than 300 clients as of September 30, 2005; net assets under management (i.e. after deduction of associated debt and liabilities) were $19 billion. For more information, visit www.prei.com.

Prudential Financial companies, with approximately $522 billion in total assets under management as of September 30, 2005, serve individual and institutional customers worldwide and include The Prudential Insurance Company of America, one of the largest life insurance companies in the United States. These companies offer a variety of products and services, including life insurance, mutual funds, annuities, pension and retirement related services and administration, asset management, securities brokerage, banking and trust services, real estate brokerage franchises and relocation services. For more information, visit www.prudential.com.