Morgan Now Sole Owner of $1.5B Portfolio

The company facilitated the consolidation of interests via three separate transactions involving two different partners: AIG Global Real Estate Investment Corp., the real estate division of American International Group Inc., which still owes the federal government billions in bailout funds, and Berwind Property Group.

January 12, 2011
By Barbra Murray, Contributing Editor

Courtesy Flickr Creative Commons user Luke Wisley

Morgan Properties’ status as a stakeholder in a 1,500-unit apartment portfolio has just been upgraded to sole owner now that the company has wrapped up the acquisition of its joint venture partners’ interests in the group of 76 middle-market multifamily assets, which are valued at a total of over $1.5 billion.

Morgan Properties facilitated the consolidation of interests via three separate transactions involving two different partners: AIG Global Real Estate Investment Corp., the real estate division of American International Group Inc., which still owes the federal government billions in bailout funds, and Berwind Property Group.

Some of the properties involved were part of Morgan Properties’ $1.9 billion joint venture acquisition with AIG of an 86-property portfolio from Kushner Cos. in 2007. The remainder of the assets encompasses apartment communities that Morgan Properties and Berwind had owned together since the 1990s.

Morgan founder & president Mitchell Morgan asserted that he has had a mutually beneficial relationship with his institutional partners for the past 15 years, with the partners providing his firm capital to grow the firm from an owner of five communities in the Philadelphia suburbs to a major multi-family presence in the Mid-Atlantic region.

The company is remaining hush-hush on just how much it paid AIG and Berwind for their interests in the 76 multifamily assets. The company is also declining to reveal whether its own interests in the two partnerships constituted a minority or a majority stake; however, it did serve as managing and operating partner for both joint ventures. Information regarding the exact locations of the properties is not being circulated either, but the company’s core markets include suburban Washington, D.C., as well as suburban locales in New York and New Jersey.

Morgan Properties financed all three transactions through internal equity sources, and, with additional funds at the ready, the company is on the prowl for further acquisition opportunities, according to senior vice president of asset management David Koffler. He asserted that the company’s strong balance sheet and investment pipeline, together with the firm’s existing management company, will allow it to grow its portfolio.