Kushner Cos., the real estate firm that had been led by former President Donald Trump’s son-in-law, is selling about half its Baltimore-area apartment complexes, including those mentioned in a complaint filed by the Maryland attorney general’s office for its alleged mistreatment of tenants.
Two Northeast Baltimore rental town house properties, Dutch Village and Pleasantview, sold Thursday for $69.3 million to an undisclosed buyer, according to the broker who handled the sale.
The properties, with 803 total units, went on the market in late October, part of a portfolio of 10 multifamily complexes owned by Kushner, the firm formerly headed by Trump son-in-law Jared Kushner.
Commercial investors are favoring multifamily housing over office or retail properties during the pandemic, said Christine Espenshade, a vice chairman with Newmark, the brokerage firm that handled the sale of the two properties.
“We knew there would be a lot of investor interest,” Espenshade said. “You don’t have new apartments being built. You have a stable residential base and townhome products ... are appealing because of lots of space.”
Laurent Morali, president of Kushner Cos., confirmed the company has pending deals to sell seven multifamily properties in Baltimore County and one in Prince George’s County to other buyers, through brokers CBRE and Berkadia.
“We are very excited by the great execution by the Newmark team, and we wish all the best to the new owners of the properties,” said Morali, who would not comment further on the sales.
The sales are moving ahead at a time when the Maryland attorney general’s office has accused Kushner’s apartment management company, Westminster Management, of committing serious violations of consumer protection laws, based on tenants’ allegations of substandard conditions and improper fees.
In a case that dates to 2019, lawyers in Democratic Attorney General Brian Frosh’s consumer protection division filed a brief with an administrative law judge in early February outlining complaints by current and former renters at apartment complexes managed by Westminster in the Baltimore area.
In a statement provided to The Sun last month, Westminster’s general counsel said the consumer protection division is targeting the firm with “politically motivated abuse.” Jared Kushner was a senior White House adviser in the administration of his Republican father-in-law.
The attorney, Christopher W. Smith, said the firm has won multiple annual awards in Maryland for property management and that it “prides itself in maintaining industry-leading standards for upkeep, maintenance, and attention to residents’ well-being — especially during this difficult time.”
An administrative law judge is expected to issue a proposed decision in the case within about 60 days, and either side could ask the courts for a review.
On Monday, Morali declined further comment on the consumer protection case.
Last year, a Baltimore judge ruled against five area tenants, including one from Dutch Village, who brought a lawsuit in 2017 claiming Westminster had engaged in unlawful rental practices, including charging improper fees and threatening evictions to force payment.
The Evening Sun
Besides Dutch Village and Pleasantview, Kushner Cos. plans to sell several multifamily projects in Baltimore County, including Commons at White Marsh, Cove Village and Harbor Point Estates in Essex, Whispering Woods in Middle River, Fontana Village in Rosedale, and Riverview Townhomes and Highland Village Townhomes, both in Halethorpe.
Hamilton Manor Apartments in Hyattsville, in Prince George’s County, also is being sold.
Morali told The Real Deal Real Estate News in December that he believed the portfolio with thousands of units could sell for $800 million. The company is selling the properties after owning them for nearly 10 years because the properties have reached the end of their investment horizon, Morali told the real estate news outlet.
The portfolio sale represents just a portion of Kushner’s Maryland holdings. The company’s website shows additional rental communities in Mount Washington in Baltimore, Rosedale, Cockeysville and Owings Mills in Baltimore County, and Annapolis, Columbia and Frederick.
When asked about allegations of tenant complaints at Kushner managed properties, Espenshade, the broker, said only that the buildings at Dutch Village and Pleasantview are “in very good condition for their vintage. They have maintained high occupancy and have nice open space.”
She said she believed the new owner, whom she declined to identify, planned to invest in upgrades such as adding playgrounds.
Baltimore Sun reporters Jeff Barker, Alison Knezevich and Frederick N. Rasmussen contributed to this article.