The face of regional automotive dealership industry is changing: Heller and McCune have sold their operations, and Sunroad Enterprises and Perry are augmenting their holdings.
Although 2013 figures weren't available, the New Car Dealers Association of San Diego County reported that new sales amounted to $8.63 billion in 2012 -- making these highly coveted businesses when times are good.
Within the past few weeks, Group 1 Realty -- a unit of Houston-based Group 1 Automotive (NYSE: GPI) -- paid $20 million for Heller's Ford and Hyundai dealerships, and real estate at 701 Howard Ave. in Escondido, 1717 and 1919 Auto Park Way in Escondido, and 1881 Auto Park Place in Chula Vista.
Donald (DJ) Heller, whose family started Heller Ford in 1941, reported at the time of last month's sale that its Heller Hyundai dealership was the highest-selling Hyundai franchise in the San Diego County market.
The family acquired the Hyundai franchise in 2004, and the Escondido dealerships are projected to generate a combined total of $135 million in annual revenue.
“The Heller family is proud of its auto retail heritage in San Diego County," DJ Heller said in a statement. "We have appreciated the hard work of our many employees who helped to make our dealerships a success. It has been a rewarding experience to grow our family’s business. When we decided to sell, it was very important to select a buyer with a strong reputation in the industry, like Group 1."
"Beginning 2014 with the acquisition of two strong brands that expand our footprint within the San Diego metropolitan area is a great start to the year," added Earl J. Hesterberg, Group 1's president and CEO.
The Heller transaction was brokered by The Presidio Group, a San Francisco firm that specializes in automotive dealership sales.
"The market for high-volume dealerships in major metros, particularly in California, is very strong and deals are coming together very quickly," added Erin Kerrigan, Presidio managing director and co-leader of the firm’s automotive practice. "Buyers are eager to put capital to work and sellers are pleased with the prices being offered.”
Presidio’s automotive practice generally focuses on dealership transactions of more than $10 million in value.
The firm has closed more than 150 auto retail-related purchases, sales and capital raises totaling more than $4.5 billion.
Group 1 owns and operates 150 automotive dealerships, 190 franchises and 37 collision centers in the United States, the United Kingdom and Brazil that offer 34 brands of automobiles.
Another big name that sold its dealerships within the past year is the McCune family, which may be best known for pitchman Tony McCune.
McCune, whose family first came to its National City location in 1948, sold the Chrysler-Dodge-Jeep-Ram dealerships at 2340 National City Blvd., and 325 Mile of Cars Way for $7 million in a transaction last fall.
The buyer of the McCune properties, Perry Falk, who heads Perry Motors, is also very well known for his dealerships from San Luis Obispo to the National City locations. Perry Ford in Poway, for example, has been a fixture in that community for decades.
The former McCune properties include 20,080 square feet of building on 2.77 acres at 2340 National City Blvd.; 2,444 square feet of building on a 1.16-parcel at 325 Mile of Cars; and a 37,462-square-foot lot on Mile of Cars.
The National City sale ended 65 years of the McCune presence on the National City Mile of Cars, stretching back to 1948 when Tony McCune's father opened the family's original dealership.
Perry wasn't the only well-established dealership to have increased its presence in the county within the past year.
Sunroad Enterprises, which is involved in developing properties, has also been selling cars for decades.
Sunroad paid about $8.16 million to acquire a 36,245-square-foot Jeep, Chrysler Dodge and Ram auto dealership at 777 Camino del Rio S. last March from an Encinitas-based investor.
Sunroad is developing a 40,000-square-foot facility for BMW at 680 S. Marshall Ave. in El Cajon that is expected be finished in April.
Construction is also planned at the Marvin K. Brown dealerships in Mission Valley, but details on were unavailable as of press time.
Not all properties that once housed an automotive dealership will do so in the future.
The land beneath a demolished 30,000-square-foot building at 2205 Vista Way in Oceanside, that formerly held a Saturn dealership, was bought by Scripps Health for $6.53 million late last month. The health care system is planning an 85,000-square-foot outpatient surgical facility on the property.