Real estate investor Mark Gleiberman has worked with commercial properties, especially apartments, for the past 30 years. He's relying on that experience as he buys and renovates more multifamily properties and expands across the West as the value of those deals drops across the industry.
This year, his MG Properties of San Diego has bought several apartment complexes for a total of about $500 million from the Las Vegas area to the Puget Sound region. The firm expanded its multifamily presence just last month in the Bay Area with its $90 million acquisition of Artist Walk, a six-year-old 185-unit mixed-use complex with 30,000 square feet of ground floor retail in Fremont, California.
"I found over the years that apartments are not as subject to economic volatility as some of these other categories like retail and office, and there is more flexibility in terms of the sizes of properties for investment or construction,” Gleiberman, the firm's founder and CEO, said in an interview. “And people will always need a place to live regardless of what happens with the economy.”
Wheeling and dealing in apartments throughout the U.S. West is a far cry from Gleiberman’s start as a teenager doing food preparation, maintenance, customer service, expense planning and other tasks at the luncheonette owned and operated by his parents in Toms River, New Jersey, where he was born and raised. Even with multiple challenges involved in operating a restaurant, he shared his parents' appreciation for self-direction and independence and not having to answer to others for a livelihood.
“I think it was that early exposure to entrepreneurship that made me decide that I wanted to eventually run my own company,” Gleiberman said.
Privately held MG Properties now employs 850 people and oversees a portfolio of more than 28,000 apartments at 95 properties across California, Washington, Arizona, Nevada, Colorado and Oregon. Company executives estimate MG Properties has overseen more than $7 billion in property deals and projects over the past three decades.
It was a long trek to get to the point of even starting MG Properties. Gleiberman’s first years after his 1979 graduation from Drexel University in Philadelphia, where he earned a business degree, included becoming a certified public accountant and working his way up to senior management positions at global consulting firms that now go by post-consolidation names, including Deloitte and Ernst & Young.
He represented several clients in those years who had considerable real estate portfolios in multiple categories, and that work gave him insights into development and investment that eventually convinced him that apartments represented a good route to eventually becoming his own boss.
Seizing Multifamily Opportunities
He started his firm in 1992. Amid a national downturn fueled by the savings and loan collapse of the late 1980s and early 1990s, Gleiberman and his business partners found opportunities to buy and fix up apartment buildings as banks and governments were liquidating underperforming properties.
This gave Gleiberman a further education in property development, management and customer service, and he eventually decided to focus primarily on investment rather than construction, though he retains in-house teams with expertise in renovations and redevelopment.
He was also able to help hone his team’s skills in pinpointing properties best suited for investment. Gleiberman focused on regions with high potential for apartment demand stemming from job and population growth. That strategy is currently focused on Western states, as MG Properties takes steps to place personnel on the ground before committing to any specific city or region.
Gleiberman said the company generally avoids one-off investments in a given region. “We’ve decided that it’s better not to take up resources unless we’re planning to build our portfolio to at least 2,000 or 3,000 units in that area,” the CEO said.
The MG team is snapping up apartments in the West as some multifamily investors stand on the sidelines amid current tight capital markets and high inflation that are slowing demand. "On a trailing 12-month basis, September's sales activity registered the first print below $100 billion since 2014, down 69% from a staggering $316 billion that traded in the 12-month period ending in 22Q2," according to a national multifamily report from CoStar Market Analytics.
Outside of investments, Gleiberman enjoys travel and serves on executive boards, including at the National Multi-Housing Council and real estate schools at the University of San Diego and the University of California San Diego. He also leads his company’s participation in community organizations geared toward homeless residents, foster youths and those dealing with food insecurity.
In 2021, Gleiberman and his wife Hannah gave $12 million to support what now is called the Hanna and Mark Gleiberman Head and Neck Cancer Center at UC San Diego Health. They made the donation after Hanna Gleiberman was successfully treated at the center for an advanced, life-threatening form of tongue cancer. Last year, they committed to give $20 million to establish the Hanna and Mark Gleiberman Center for Glaucoma Research at UC San Diego.
Article originally published on CoStar News: https://www.costar.com/article/1956702828/apartment-investor-uses-decades-of-experience-to-seize-opportunity-in-downturn