Deal part of $50 million in transactions currently in Petroleum Realty's
pipeline under its initial $300 million credit facility and joint venture
agreement with Lehman Brothers
ATLANTA, Oct. 13 /PRNewswire/ -- Petroleum Realty Investment Partners,
L.P., the country's premier one-stop finance provider of choice to the
independent retail gas station and petroleum-related property sector,
announced today it has closed an agreement to acquire nine self-service gas
station/convenience stores from Fuel Marketing, Inc. of Atlanta for
$8,925,000. All nine properties, which operate under the Phillips 66(R)
brand, are located in the greater metropolitan Atlanta area and will be leased
back to Fuel Marketing.
The agreement is among more than $50 million currently in Petroleum
Realty's sale/leaseback and financing transaction pipeline. This deal draws
upon the Company's $300 million initial credit facility provided through
Lehman Brothers under a joint venture agreement between the two firms.
Petroleum Realty plans to go public within 24 months.
Petroleum Realty was co-founded in 1998 by former Mobil Oil Company senior
executive Michael D. Baskin of Tysons Corner, Virginia and real estate
executives David J. Glimcher of Columbus, Ohio and Stephen H. Bittel of Miami,
Florida. Petroleum Realty's goal is to acquire and/or finance a majority of
the estimated 175,000 independently owned gas stations, gas
station/convenience stores and other freestanding properties nationwide that
sell gasoline or oil including certain types of restaurants, car washes and
oil change centers. Petroleum Realty estimates that 85 to 90 percent of these
properties will meet its acquisition and/or financing criteria.
Michael D. Baskin, Senior Vice President -- Acquisitions and Operations
for Petroleum Realty, noted: "This nine-property acquisition immediately
provides us with a strong foothold in the greater Atlanta region, one of the
best petroleum markets in the country. With upwards of $50 million already in
our transaction pipeline, we expect to announce additional rounds of
acquisitions and financing deals through the end of the year, giving us a
broader geographic base to build upon heading into 2000."
David J. Glimcher, Chairman and CEO of Petroleum Realty, commented: "Fuel
Marketing is a leading independent owner of gas station/convenience store
properties. This transaction validates our strategic vision that a tremendous
untapped opportunity exists in being the first company to focus exclusively on
providing financing solutions to petroleum industry jobbers, dealers and
operators. There is a major consolidation trend underway amid the vast,
fragmented petroleum market due to oil company mergers such as BP/Amoco,
Exxon/Mobil and Texaco/Shell, with these newly combined entities being forced
to divest significant numbers of gas station properties under U.S. antitrust
provisions."
David Glimcher Notes Benefits of Sale/Leaseback Financing
Glimcher emphasized: "Independent gas station owner have historically
sought financing locally through traditional banking relationships-often
unsuccessfully-restricting their ability to maximize expansion opportunities
and realize an enhanced return on their invested capital and other benefits
possible under a sale/leaseback arrangement. To a typical owner/operator,
that can mean a difference of as much as several hundred thousand dollars.
Furthermore, sale/leaseback financing allows operators and distributors to
separate their real estate assets from their business operations. This can
enable them to realize a greater total market valuation for each asset
individually, in turn providing them with greater financial flexibility."
Fuel Marketing President Glen R. "Rusty" David Comments
Glen R. "Rusty" David, President of Fuel Marketing, Inc., said: "One of
the primary reasons we selected Petroleum Realty for this transaction is their
exclusive focus on petroleum-related properties and their ability to
custom-tailor a deal to suit our needs. We were impressed with their
professional acquisition team-particularly Armen Grigorian in the newly-opened
Atlanta office-and their broad-based, corporate-level petroleum industry
backgrounds. They speak our language and understand the issues unique to this
industry, such as environmental considerations pertaining to the handling and
disposal of petroleum products, as well as the significant costs and
liabilities associated with underground gasoline storage tanks. Based on our
positive experience, we would strongly encourage owners examining their
financing options to consider doing business with Petroleum Realty."
About Petroleum Realty Investment Partners
Petroleum Realty Investment Partners, L.P. seeks to become the country's
one-stop finance provider of choice to the independent retail gas station and
petroleum-related property sector, offering the following services: 1) sale
leaseback financing; 2) mortgage loan financing; 3) equipment financing; and
4) third party construction loan services.
Petroleum Realty has entered into a joint venture agreement with Lehman
Brothers which has provided a $300 million credit facility to purchase gas
stations, convenience stores and related entities. Mortgage financing will be
originated through Lehman while equipment financing and construction loans
will be provided through third parties. Petroleum Realty will provide loan
originations through Lehman as a separate program.
Petroleum Realty's main regional offices are located in Tysons Corner,
Virginia; Columbus, Ohio; and Miami, Florida; with additional regional offices
in major markets across the U.S.
For more information regarding this transaction, contact Armen Grigorian,
Regional Director of Acquisitions in Petroleum Realty's Atlanta office, at
770-448-0456.
For general information, contact Dana Rossi, Communications Manager in
Petroleum Realty's Virginia/Washington, D.C. office at 703-714-8888.
Visit the Petroleum Realty website at: http://www.petroleumrealty.com .
SOURCE Petroleum Realty Investment Partners, L.P.
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Related links:
http://www.petroleumrealty.com
CONTACT:
General Information, Paul Scheeler,
312-640-6742, or email, pscheele@frb.bsmg.com, or Media
Inquiries, Laura Kuhlmann, 312-266-2239, or email,
lkuhlmann@att.net, both of FRB-BSMG; or Michael D. Baskin, Sr.
V.P. of Acqs. & Ops., Virginia-D.C. Office, 703-714-8888, Stephen
H. Bittel, President & COO, Florida Office, 305-536-1300, or
David J. Glimcher, Chairman & CEO, Ohio Office, 614-224-4777, all
of Petroleum Realty Investment Partners
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