When it comes to acquiring communities, Morgan Properties is a “well-oiled machine,” according to the president of Morgan Properties JV Management, Jonathan Morgan.
That machine was busy in 2017 as the King of Prussia, Pa.–based company completed $1.2 billion in acquisitions and added more than 8,600 units to its portfolio, placing the company at No. 20 on this year’s NMHC 50 Owners list, a jump of five positions from the year before.
Morgan Properties now owns roughly 45,000 units in 10 states, primarily in the Mid-Atlantic and Northeast. Since 2011, the firm has acquired properties through its affiliate Morgan Properties JV. In the past five years, Morgan Properties JV has acquired about 23,000 units and completed more than $3 billion in total acquisitions.
Of note last year, the company made two acquisitions in the Mid-Atlantic that each totaled more than 2,600 units: a six-property portfolio in Alexandria, Va., and a four-property portfolio in the suburban Maryland–Washington, D.C., corridor.
“I am thrilled about everything we acquired last year because, relative to some of the opportunities we’re looking at this year, [2017] looks a lot more attractive in terms of financing and pricing,” Morgan says. “It was the right time to scale the business from an acquisition standpoint.”
Speaking of active 2017s, it’s tough to look past Atlanta-based Carroll Organization, which made the NMHC 50 Owners list for the first time this year, at No. 36. Its unit count of 26,280 was up roughly 8,300 from 2016.
The company acquired 40 properties last year. One deal in late December vaulted Carroll onto the NMHC list: a joint-venture acquisition with PGIM Real Estate that nabbed 28 properties across Florida, North Carolina, Tennessee, and Texas totaling 8,578 units.
On the whole, says David Perez, Carroll’s COO, the company is always looking for new opportunities but doesn’t take unnecessary risks with its balance sheet. “We really strive for quality over quantity,” he says. “It just so happens that they came in a bundle package at the end of last year.”
Perez says the deal made sense for Carroll because it already had a footprint in nearly every market included in the portfolio. And, he adds, the company has developed a reputation over the years for being reliable.
“As long as I’ve been here, we’ve never dropped a deal,” Perez says. “Our team is, bar none, the best around. We have a deal we want to go get and we’re able to work with anybody to get it done.”
It remains to be seen how active apartment companies will be through the end of 2018 when it comes to buying and selling properties.
“The market is starting to catch up,” Morgan says. “There’s less opportunity, there’s a lot of capital on the sidelines, and interest rates have gone up, so it’s harder to find attractive deals.”
