Mergers & Acquisitions

GPM Receives $1 Billion Real Property Commitment

Agreement with Oak Street Real Estate Capital boosts retailer’s acquisition growth strategy
arko gpm

RICHMOND, Va. — GPM Investments, a wholly owned subsidiary of ARKO Corp., has entered into an agreement with real estate investment firm Oak Street Real Estate Capital LLC. Oak Street has agreed to purchase and lease to GPM real estate associated with acquisitions of convenience-store brands and fueling stations and is committing up to $1 billion to the program for one year.

Through the arrangement, GPM will own and operate the related acquired businesses, and Oak Street will own the real estate and lease it to GPM.

GPM, which operates or supplies approximately 1,350 company-operated stores and 1,600 dealer sites, has executed 18 acquisitions since 2011, growing the company to almost 3,000 sites with more than 10,000 employees operating in 33 states and Washington, D.C. This agreement further demonstrates the company’s continued commitment to aggressive growth, it said.

“We believe that working with Oak Street will allow us to be a more attractive acquirer and add additional flexibility as we structure acquisitions,” said Arie Kotler, president and CEO of GPM. “We remain highly focused on our core acquisition model, and we expect that this partnership will enhance certainty of deal execution and as a result, strengthen our growth as a company.”

Marc Zahr, CEO and managing partner of Oak Street, said, “ARKO is a phenomenal company that is making the right strategic decisions. Their ability to utilize our balance sheet to fund their real estate footprint allows them to focus on their accretive growth and core operations. We are excited about what our partnership can do for their business and to help fuel their continued success.”

Richmond, Va.-based GPM operates in three segments: retail, which consists of fuel and merchandise sales to retail consumers; wholesale, which supplies fuel to third-party dealers and consignment agents; and GPM Petroleum, which supplies fuel to GPM and its subsidiaries selling fuel (both in the retail and wholesale segments) as well as sub-wholesalers and bulk purchasers.

GPM brands include Fas Mart, Shore Stop, Scotchman, BreadBox, Young's, Li'l CricketNext Door Store, Village PantryApple MarketJiffi StopAdmiralRoadrunner MarketsJiffy Food MartsE-Z Mart1 Stop and TownStar. The stores, which feature the fasREWARDS loyalty program, offer a large selection of beverages, coffee, fountain drinks, candy, salty snacks and other products. Proprietary food offerings include fresh chicken, fresh-made salads, sandwiches and grab-and-go meals.
Oak Street, based in Chicago, is a real estate investment firm focused on acquiring properties net-leased to investment grade and creditworthy tenants. Its investment funds have $15 billion of discretionary acquisition capacity and co-investment capacity to be deployed into sale-leasebacks and build-to suits. Oak Street specializes in providing flexible capital solutions to a variety of organizations including corporations, healthcare systems, universities and government entities.

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