Real estate mogul Mitchell Morgan has made it onto the Forbes 400 list as the third-largest owner of apartments in the U.S. by taking a unique approach to investing in older buildings in smaller cities. His company, Morgan Properties, has grown to over 95,000 units across 19 states, with a focus on renovating properties in midsize cities to increase rents. Morgan’s success has also led to his involvement in philanthropic endeavors and high-profile investments, including backing the Washington Commanders’ purchase in the NFL.
Morgan’s strategy involves targeting ‘Class B’ apartments, older properties catering to tenants with lower incomes. While these properties may not be as luxurious as newer developments, they offer stable cash flow and are less affected by economic downturns. Morgan’s decision to invest in these properties in less-fashionable cities has paid off, with the firm becoming the largest landlord in Rochester, New York, after acquiring over 18,000 units for $1.9 billion in 2019. The post-Covid real estate market has seen rising rents in cities like Indianapolis, Columbus, and Fayetteville where Morgan Properties has a presence.
Despite some legal challenges, including lawsuits from tenants, Morgan Properties has positioned itself as a key player in the apartment ownership market with a family-owned touch. Morgan’s frugal approach, learned from his upbringing and early career struggles, has helped him navigate the industry successfully. By bringing in partners and focusing on renovations, Morgan has been able to build a multi-billion dollar real estate empire while maintaining a relatively low debt load compared to industry averages.
The Morgan family’s involvement in the business also includes Mitchell’s sons Jason and Jonathan serving as co-presidents of the firm and spearheading different aspects of the company, including debt investments and joint ventures. The family’s dedication to their business model, which focuses on workforce housing in suburban locations, has allowed them to stand out in the competitive real estate market. Despite opportunities to pursue an IPO, the family decided to keep the firm private, doubling down on their successful investment strategy.
With a track record of successful acquisitions and renovations, Morgan Properties continues to expand its portfolio, recently acquiring over $2.5 billion worth of apartments in the Midwest, Texas, and the Carolinas. The company’s commitment to renovations and value-add projects, such as upgrading kitchens and appliances, has contributed to its success in the real estate market. While Morgan may be in his 70s, he remains optimistic about the future and continues to seek out new opportunities for growth and expansion across the country.
