Author: LegacyAuto

[vc_row][vc_column][vc_column_text]Legacy Automotive Capital (Legacy) recently completed the sale/leaseback of Kia of West Nyack and Clifton Park CDJR in partnership with one of the country’s fastest growing dealer groups, Dennis & Co. Automotive Group (Dennis & Co.). Chelsea Mandel, founding partner of Ascension real estate advisory firm, advised Dennis & Co. on the transaction.

Dennis and Co., with stores in Manhattan and the surrounding greater New York City MSA, utilized Legacy’s sale-leaseback program to access the “Real Estate Blue Sky” or growth capital trapped in its real estate holdings. Dennis & Co. will use the proceeds to support its existing dealership footprint and to fund its future Buy/Sell expansion efforts.[/vc_column_text][vc_row_inner css=”.vc_custom_1690142877182{padding-top: 25px !important;padding-right: 25px !important;padding-bottom: 25px !important;padding-left: 25px !important;background-color: #d8d8d8 !important;}”][vc_column_inner width=”3/4″][vc_column_text]Brian Dennis, Dennis and Co.’s CEO stated: “We continue to be focused on expanding our dealership network and Legacy offered a way to provide us with a competitive advantage in the Buy/Sell marketplace by unlocking the value in our real estate. Legacy offered the most competitive terms by a significant margin and was able to execute and close quickly. We look forward to partnering with them on future deals”.[/vc_column_text][/vc_column_inner][vc_column_inner width=”1/4″][mpc_image image=”31878″ image_opacity=”100″ image_inner_border_gap=”0″ effect=”none” image_hover_opacity=”100″][vc_column_text]

Brian Dennis

[/vc_column_text][/vc_column_inner][/vc_row_inner][vc_empty_space height=”25px”][vc_column_text]Legacy, which has raised a $1.5bb fund to purchase New Car Franchised dealership real estate, added these two assets to what was a record-breaking quarter for the young company. CEO Benjamin Catanese stated: “It was a pleasure to work with Brian and his team on this transaction as they understand the importance of building the most efficient capital stack in the hyper competitive market for dealership Buy/Sells. We will certainly work together again in the near future.”[/vc_column_text][vc_empty_space height=”25px”][vc_row_inner][vc_column_inner width=”1/2″][mpc_image image=”31887″ image_opacity=”100″ image_inner_border_gap=”0″ effect=”none” image_hover_opacity=”100″][/vc_column_inner][vc_column_inner width=”1/2″ css=”.vc_custom_1690143054324{padding-top: 25px !important;padding-right: 25px !important;padding-bottom: 5px !important;padding-left: 25px !important;background-color: #d8d8d8 !important;}”][vc_column_text]Real Estate Blue Sky: The hidden value dealers have in their real estate in excess of appraised value.[/vc_column_text][/vc_column_inner][/vc_row_inner][/vc_column][/vc_row]

[vc_row][vc_column width=”2/3″][vc_column_text]Legacy Automotive Capital had an exciting first year, surpassing our target and we are conducting an annual survey to gauge dealer feedback on the market.

We will share the results with everyone upon completion.[/vc_column_text][/vc_column][vc_column width=”1/3″][vc_btn title=”TAKE OUR SURVEY” style=”custom” custom_background=”#062060″ custom_text=”#ffffff” link=”url:https%3A%2F%2Fdocs.google.com%2Fforms%2Fd%2Fe%2F1FAIpQLSfB-1UrhraPP7NyAQ9FqhbSmQMgkr8iy0io9R5ayJ_l-ZtlMw%2Fviewform|target:_blank”][/vc_column][/vc_row]

Legacy Automotive Capital is thrilled to open our new HQ office to support our growing team and business!

The new office is situated in the suburbs of Philadelphia, in a central location that we felt would allow for the most future growth. We are excited to expand our footprint by leveraging this space to meet our future goals and can’t wait to work with you along the way.

LEGACY AUTO CAPITAL + REAL ESTATE BLUE SKY = MAXIMUM VALUE FOR NEW CAR DEALERSHIP REAL ESTATE.

[vc_row][vc_column width=”2/3″][vc_column_text]The NYSADA Webinar Event on March 8th of 2023 was a great success. The event, titled “The Urgency of Succession, Estate Planning, and the other Blue Sky: Real Estate Sale and Leasebacks” was led by Todd Marcelle of Legacy as well as Leonard Bellavia, Esq.

More information about the success of the event will be coming soon. Thanks for your patience.[/vc_column_text][/vc_column][vc_column width=”1/3″][vc_single_image image=”31829″ img_size=”full”][/vc_column][/vc_row]

2023 State of The Union — Real Estate Blue Sky

First and foremost, I would like to acknowledge and thank all our Dealer Partners for what was a remarkable 2022. Legacy Automotive Capital (Legacy) successfully launched its latest real estate fund in May with a specific charter of buying the real estate associated with New Car franchised dealerships. Over the past seven (7) months we’ve had the opportunity and privilege to work with some of the most progressive Dealer groups in the country, maximizing the value of their real estate and through our unique perspective as Dealer Principals and Auto industry veterans, providing capital optionality that previously didn’t exist in the Buy/Sell space…for Dealers, by Dealers.

A Pillar of our investment philosophy is the entrepreneurship, tenacity and resilience of the Dealer body which fuels our business and will continue to drive growth for Legacy and its customers in 2023 and beyond. While the industry continues to evolve and electrify, we are undoubtably “long” on the necessity of the franchise new car Dealership model and believe in the long-term strength of the franchise system despite what Wall Street might have the broader public believe.

New Car franchised Dealers are the final and most crucial connection point to communities, families and most specifically the drivers that they serve. Dealerships are critical outposts where customers are afforded a massive convenience along their way to purchasing, taking delivery, securing financing and servicing their vehicles. The importance of last mile logistics, point of purchase and, perhaps, most significantly, the service center go-between for Customers and the Factory cannot be understated and should never be devalued.

Where else can you find a Car Wash, a Bank, an Internet Cafe, a Showroom, a State-of-the-Art Service Center and an Insurance Agency under one roof? The answer is most likely on the major thoroughfare in your hometown, at a four-way lighted intersection with ample parking and friendly faces waiting to help at all hours of the day, six or seven days a week.

This is what New Car dealers have “built” and what we at Legacy believe they should be properly compensated for. So how does Legacy impact this ecosystem? We’re all familiar with the concept of “Blue Sky”. Dealers and advisors trade in this currency every day and its importance has never been greater than over the last few years as both profits and valuation multiples of earnings have grown. However, in most Buy/Sells there is little focus placed on what we call the REAL ESTATE BLUE SKY. This is where Legacy comes in.

From Legacy’s point of view, a generic appraisal in no way accurately identifies the true value of the unique real estate that underlies a franchised New Car dealership. However, until now, Dealers have accepted appraised value as fair market value and have ignored the REAL ESTATE BLUE SKY that they have created, in most cases, over many years of ownership and adherence to Brand standards and Image Compliance. New Car dealership real estate is unique and should be treated as such.

To existing Dealers through sale-leaseback, or prospective Dealers via Buy-Sell acquisition financing, Legacy’s program offers the opportunity to extract the maximum value of their real estate regardless of what the appraised value may be. We are more interested in you as an Operator; your sales effectiveness, fixed coverage ratio, UIO and operational efficiency than we are in what the vacant building down the street sold for three years ago.

The New Car business has never been healthier and therefore the tenancy that dealers offer has never been more attractive to us. This fact is ignored during the discussion of a Buy/Sell and, on average, dealership real estate assets trade at a 20-40% discount to Legacy’s self-determined ‘fair market value’. This equates to an average of $2 – $5 Million Dollars of additional funds to the Dealer per rooftop!

Legacy believes that New Car dealerships have long been fundamentally strong real estate assets hiding in plain sight with super ‘sticky’ tenancy. In a Buy/Sell, these assets have always traded as part of a “package deal” at a valuation based solely on appraised value thereby leaving 20-40% of the real estate asset’s true value on the table. The sum of the parts is greater than the whole! This 20-40% margin provides tremendous flexibility in the capital stack, and can, in many cases, represent the equity needed in the entirety of a Buy/Sell.

Legacy enters 2023 with ~$1.5 Billion Dollars to deploy into the New Car dealership marketplace. The market has already shown signs of correction and new market fundamentals will underline the importance of extracting maximum value from all aspects of the business… especially Real Estate.

Legacy is a Real Estate company founded by Dealers that at its core believes in the franchised New Car Dealership system. Our goal in 2023 and beyond is to support the Dealer Network as a financial catalyst for growth and an option for all Dealers to identify and experience the true value of the REAL ESTATE BLUE SKY they have created in their businesses.

Happy Holidays from Legacy Automotive Capital!

CBRE Fast Five: Secret Sauce Interview

LAC’s own Todd Marcelle was interviewed by Karly Iacono of CBRE Fast Five to discuss how dealers can unlock the true value of their real estate with Legacy Automotive Capital.

Take a look at the video below to hear and see this video in full.

Acquisition Announcement – Subaru Dealer

Legacy Automotive Capital finalizes a sale/leaseback with a regional dealer group through its acquisition of a Subaru dealership property in the Northeast US. The acquisition adds another property to Legacy’s growing dealership portfolio.

Acquisition Announcement – Honda Portfolio

Legacy Automotive Capital re-capitalizes a regional dealer group through its acquisition of 2 Honda dealership properties in the Northeast US. The acquisition adds 2 properties to Legacy’s growing dealership portfolio.

Legacy Automotive raises $500 million

Legacy Automotive Capital is aiming to deploy $500 million over the next 36 months by assisting dealers in acquiring property in buy-sell transactions or providing them capital via a dealership sale-leaseback.

An investment firm, led by the co-founders and an investor of a business sold to Reynolds and Reynolds Co., aims to spend $500 million over the next three years by assisting dealers in acquiring property in buy-sell transactions or providing capital via sale-leasebacks of dealerships.

Legacy Automotive Capital, founded in 2019 by Ben Catanese, Todd Marcelle and TJ Doyle and based in Exton, Pa., in suburban Philadelphia, has an additional $1 billion in funding commitments that could come later.

“We believe that we can represent the real estate component of the capital stack in a buy-sell transaction,” Catanese, Legacy’s CEO, told Automotive News. “That’s really where we think we can be helpful, where we currently are being helpful to dealers.”

To read the full article, click here.