The Key Portfolio
The Key: Case Study
The Key is the “best buy here pay here” Oklahoma City car dealership consisting of three locations across the Oklahoma City MSA (Oklahoma City, Moore & Midwest City). The Key was incorporated in 2011 by a local proprietor & entrepreneur has successfully grown the auto related businesses over the last 20 years. The dealership offers used vehicles for sale with the option for buyers to utilize in-house financing, insurance & warranty products. Additionally, The Key has expanded their financing services to a network of partner dealers further increasing their reach and bottom line.
The Key was looking for a way to generate capital in an effort to expand the business by opening up new dealership locations throughout the Midwest. The new sites would drive additional revenue to all of his auto related service lines; however, the company was looking for a way to achieve its goals without having to come out of pocket or obtain financing.
As part of the Corporate Finance division of Stan Johnson Co., our team was able to present & educate the owner on the sale leaseback concept, as the owner currently owned all of its real estate locations. This alternative financing method allows an owner to access 100% of the market value of real estate with no restrictive debt covenants, thus being able to utilize this capital to achieve their objectives of growing their company.
We executed a detailed marketing process that produced several competitive offers which in return created a bidding war. The Key’s real estate was ultimately secured with obtaining a 100% of the asking price with a 10 year absolute net lease structure for all three of their locations in Oklahoma City. A publicly traded Real Estate Investment Trust (REIT) was the best fit and strategic partner for The Key and the acquisition was completed. The final result allowed the ownership to acquire additional locations nationwide through a series of tax deferred exchanges. SJC was the link that educated the client in taking advantage of a strong commercial real estate and auto market cycle to maximize sale proceeds.
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