Capital Automotive REIT, a specialty finance company for automotive retail real estate, announced October 23rd financial results for the third quarter ended September 30, 2001.

The company reported record third quarter revenues, net income and adjusted funds from operations. Total revenues were $30.3 million for the quarter ending September 30, 2001, an 18% increase from revenues of $25.8 million in the third quarter of 2000. Net income, before an extraordinary charge of approximately $0.02 per share relating to a significant modification of debt, was $8.3 million, or $0.33 per diluted share, compared to $6.5 million, or $0.31 per diluted share, in the same quarter last year. AFFO for the three months ended September 30, 2001 increased 21% to $15.6 million as compared to $12.9 million for the same quarter last year. AFFO on a diluted per share basis increased 5% to $0.46 per share from $0.44 per share for the same quarter last year.

Total revenues for the nine-month period ended September 30, 2001 were $86.8 million compared to $76.2 million for the same period in 2000. Net income before an extraordinary charge relating to a significant modification of debt, for the nine-month period was $22.2 million, or$0.96 per diluted share, compared to $19.2 million, or $0.91 per diluted share, in the same period last year. AFFO for the nine-month period ended September 30, 2001 increased 14% to $43.5 million as compared to $38.0 million for the same period last year. AFFO on a diluted per share from $1.29 per share for the same period last year.

The company previously announced on October 16, 2001 that its Board of Trustees declared a cash dividend of $0.3880 per share for the third record as of November 9, 2001. The third quarter dividend is the 15th consecutive increase in the quarterly dividend and represents an annualized rate of $1.552 per share and an 8.0% yield based on Monday's closing stock price.

Third Quarter Acquisitions Highlights

Consistent with its plan for accretive growth through strategic investments, the company completed approximately $121 million of acquisitions during the third quarter of 2001. The company funded the acquisitions with net proceeds from the company's underwritten public equity offering that closed during the third quarter, the issuance of long-term debt drawn under a $150 million commitment from Toyota Financial Services and funds drawn down on the company's short-term credit facilities. The average initial lease term for these acquisitions is 15.2 years, with multiple renewal options. The third quarter acquisitions include:

• Nine automotive retail properties totaling approximately $102.4 million from CarMax, a division of Circuit City Stores, Inc. This acquisition added approximately 413,000 square feet of buildings and improvements on approximately 116 acres of land in seven states. Eight uused-car superstores and five new-car franchises are operated on these nine properties including Toyota, Mitsubishi and Nissan. These properties have initial lease terms of 15 years and multiple renewal options.
  

• One property totaling $7.8 million and leased to Jack Maxton Chevrolet, a new tenant in Columbus, Ohio. The Maxton family has operated a Chevy dealership in the Columbus area for over 70 years. Jack Maxton Chevrolet has been the largest GM dealership in Columbus, Ohio for the last 12 years.
  

• One property, consisting of a BMW used-car facility, totaling $2.7 million and leased to Momentum Automotive Group, an existing tenant in Houston, Texas. Capital Automotive currently leases nine properties to Momentum. Momentum, which operates six franchises from these properties, including BMW, Jaguar, Land Rover, Porsche and Volvo, is one of the premier franchised luxury automotive dealer groups in the United States.
  

• Facility improvements and construction fundings totaling $7.6 million on previously acquired properties in five states.

  
  

  Commenting on the news, Thomas D. Eckert, president and CEO stated, "The high quality of our acquisitions, coupled with the strong performance of our tenants, has made this a solid quarter for Capital Automotive. Our conservative capital strategies, both debt and equity, are focused on maintaining our stable cash flows and enhancing shareholder value."

  
  

  David S. Kay, vice president and CFO added, "We are very pleased with our operating results for the third quarter and remain confident in the execution of our 2001 and 2002 business plan. We remain comfortable with our AFFO guidance of $1.84 per share and $1.97 per share for 2001 and 2002. In addition, we expect to pay our shareholders an annual dividend of $1.55 and $1.60 per share for 2001 and 2002, respectively, a 3.2% increase. The 2002 estimates are based on acquisition volume of approximately $100 million and investment spreads that are consistent with our overall portfolio. Although the timing of the acquisitions may vary from quarter to quarter, we remain comfortable with this guidance."

  
  

  About Capital Automotive
  

  Capital Automotive, headquartered in McLean, Virginia, is a self-administered, self-managed real estate investment trust formed to acquire the real property and improvements used by operators of multi-site, multi-franchised automotive dealerships and related businesses. Additional information on Capital Automotive is available on the company's Web site at www.capitalautomotive.com.