Listen to this articleThe basics:
- Sagard adds 116-unit Highlands at Morris Plains to value-add fund
- Property offers NYC access, NJ Transit proximity, in-demand amenities
- $1.6M renovation plan includes unit, common area upgrades
- Fund targets workforce housing, last-mile and niche assets
Sagard Real Estate continues efforts to expand a newly launched fund targeting last-mile industrial, attainable rental housing and more with a new multifamily acquisition in North Jersey.
The former EverWest Real Estate Investors announced adding Highlands at Morris Plains June 26. Located one-half mile from the Morris Plains NJ Transit station, the rental property also offers accessibility to Interstates 287 and 80 as well as Route 24. Sagard provided neither the seller’s identity, nor the purchase price for the property.
The location offers convenience to area employers as well as New York City and Morristown. It marks the buyer’s third investment in Sagard’s recently launched, moderate value-add, open-end fund. Beyond the aforementioned targets, Sagard said it also looks for other niche property sectors in supply-constrained, high-growth markets.
“This fund is designed to capitalize on today’s market dislocation and shifting investor appetite, with a focus on workforce housing and last-mile logistics that are supported by structural demand drivers and limited new supply,” said John Maurer, head of equity, Sagard Real Estate. “Highlands at Morris Plains exemplifies the type of opportunity where we see potential to deliver strong risk-adjusted returns for our investors.”
Updates due
Built in 2003, Highlands at Morris Plains located at 40 E. Hanover Ave. features 116 units and a cumulative more than 112,000 square feet.
The property offers one- and two-bedroom units housed in two, wood-frame buildings. Units include 9-foot ceilings, stainless-steel appliances, in-unit washers and dryers, vinyl flooring and walk-in closets. The 5.4-acre property also features amenities. Sagard highlighted a fitness center, gazebo with barbeque stations, open green space, and both covered and surface parking.
In 2022, boutique real estate investment banking firm BlueGate Partners LLC posted to its website it was retained to arrange the sale of Highlands at Morris Plains. That firm put the value of the property at $35 million; identifying it as a “prime value-add candidate.”
Sagard’s plans for the site include upgrades for 96 apartments, enhancements to common areas and improved outdoor amenities. A company spokesperson told NJBIZ the total renovation project is valued at $1.6 million.
That work will start immediately, the spokesperson added, and continue as unit leases roll over over the coming few years.
‘A solid foundation’
Co-Portfolio Manager for the fund Tyler Williams commented, “We’re excited to add Highlands at Morris Plains to our portfolio, aligning with our strategy of investing in well-located assets in established, high-demand submarkets. We’ve targeted Northern New Jersey for its appeal to the greater NYC workforce, particularly for young families. The property’s physical plant, location and amenities provide a solid foundation for long-term investment, while the original unit finishes offer an opportunity to upgrade interiors and enhance value near-term.”
Learn more about the other two assets in Sagard Real Estate’s fund, including another local addition:
Niche.com ranks Morris Plains with an “A+”. The overview highlights the area as Good for Families (A+), for its Public Schools (A) and nightlife (A-).
Sagard Real Estate is a vertically integrated real estate investment advisor and operator providing investment management services throughout the U.S. Based in Denver, the firm has regional offices in the New York City, Charlotte, Austin, Los Angeles and San Francisco metro areas.
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