Morgan Properties Buys $323M Carolinas Portfolio

Wexford. Image courtesy of Morgan Properties

Multifamily heavyweight Morgan Properties has taken another bite out of the Class B apartment market by acquiring 18 communities in North and South Carolina for $323 million. The addition of the 3,256-unit portfolio more than doubles the company’s unit count in the Carolinas while bringing its national platform to more than 78,750 units.

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The transaction continues a pattern of large-scale purchases by Morgan Properties, which snapped up $3.1 billion in properties totaling 24,000 units in 2019 and remains interested in value-add multifamily assets. In a prepared statement, Jonathan Morgan, the company’s president, cited the Carolinas’ fast-growing markets with access to major employment hubs.

Charlotte’s multifamily market has weathered the ongoing economic crisis relatively well, with average rents declining by 0.3 percent in the second quarter, according to the latest Yardi Matrix report. Deal activity, however, totaled only $464 million in the first half of 2020, compared to $3.1 billion in multifamily assets traded across the metro in 2019.

Amazon lockers on the way

The newly acquired portfolio includes 13 properties in or near Charlotte, N.C., three in the Winston-Salem area of North Carolina, and another three communities in South Carolina. Morgan Properties plans to spend an additional $20 million to reposition the properties and will keep more than 70 existing jobs, while creating 10 new regional management roles based in the two states.

The renovation strategy will include high-end kitchen and bathroom upgrades, washer and dryer installations and enhanced signage and curb appeal. Morgan Properties will also roll out amenity improvements such as dog parks, playgrounds with outdoor fitness stations, bike racks with a bike-sharing program, resident patios and package rooms with Amazon hub lockers.

The portfolio includes the following communities:

Charlotte area:

• Charlotte: Village at Brierfield, Wexford, Sharon Pointe
• Concord: Parkway Station, Trinity Station, Waters Edge
• Kannapolis: Kannan Station & McClain Heights
• Monroe: Woodbrook
• Salisbury: Alexander Station, Ashton Woods, Lakewood
• Huntersville: Huntersville 

Winston-Salem, N.C.:

• High Point: Highland Ridge
• Clemmons: Clemmons Station
• Winston-Salem: Enclave at North Point

South Carolina

• Rock Hill: Gable Oaks
• Gaffney: 1022 West
• Anderson: Station 153

The trio of Charlotte properties, totaling 518 units, were built from 1995 to 2002 and are all more than 98 percent occupied, according to Yardi Matrix data. All offer a mix of one-, two- and three-bedroom apartments, with Sharon Pointe also containing studio units.

Kannan Station and McClain Heights in Kannapolis, a suburb northeast of Charlotte, are two properties that are being consolidated into one, Morgan Properties informed Multi-Housing News.

Deal streak

Morgan Properties obtained $661 million in refinancing for a 22-property workforce housing portfolio spanning 4,670 units across four states this past May. In October of last year, the company closed a huge deal to acquire an 80-property multifamily portfolio spanning 15,000 units across eight states.

That deal followed the acquisition of a 10-property, 4,130-unit portfolio that made Morgan Properties the largest multifamily owner and operator in Philadelphia in March 2019.