Riding the Crest of a Multifamily Boom

//February 17, 2006//

Riding the Crest of a Multifamily Boom

//February 17, 2006//

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Low-key but focused, Kislak makes big-bucks deals for investorsWOODBRIDGE

The market for investing in multifamily apartment complexes is rolling nationwide with New Jersey and other markets in the New York Metropolitan region leading the charge.

One of the strongest local players is Kislak & Co., a relatively low profile, 100-year-old brokerage house based in Woodbridge that specializes in matching deep-pocketed investors with sellers of multifamily portfolios. Kislak, which put together investment deals worth more than $500 million in 2005, has been listed by New York City research firm Real Capital Analytics as the second most active firm in the New York metro region over the past 12 months. It follows Rockwood Realty and precedes Cushman & Wakefield, both of New York City.

Kislak began 2006 on an even stronger note, pushing through eight deals totaling more than $100 million in the first three weeks.

Jeff Wiener, Kislak’s president, says some of those deals could end up as the year’s largest in the state. They include the $67 million sale last month of a 642-unit apartment portfolio in Somerville on behalf of Brookside Investment Association and its partner Bedford Brookside. Edgewood Properties of Piscataway, the buyer, bid aggressively on the property because it has plans to redevelop the site for other uses.

Another big January deal was the $21 million sale of a 456-unit apartment portfolio in Lindenwold to Houlihan Partners for the property’s owner, Horizon Services and Management.

The firm’s top clients include such prominent investors as real estate investment trust Home Properties of Rochester, N.Y., the Lightstone Group of Lakewood and Kushner Cos. of Florham Park.

“They don’t take ‘no’ for an answer and call you eight days a week. They hound you till a deal is made,” says Jeff Kurtz, president at real estate investment firm Kamson Corp. in Englewood Cliffs and a long-time Kislak client. “If I am in Mexico, Jeff Weiner will fly to Mexico to get a document signed. He’s constantly a thorn in your side till a deal is signed.” Weiner’s firm has closed some 50 deals through Kislak over the past 25 years.

The persistent Wiener, who has been at Kislak for 32 of his 55 years, says the firm’s main strength comes from a deal-making style that is “face-to-face, one-on-one.” Kislak’s big-name competitors include global brokerage firms such as CB Richard Ellis of El Segundo, Calif. and national presence Marcus & Millichap of Encino, Calif.

While further-flung markets and investors have beckoned, Kislak’s management team is content with its focus on the New York metro region; over the years it has spurned offers of alliances with others in the business. That has helped it maintain a sharp focus on multifamily buildings in its territory.

“If real estate is about location, location, location, Kislak finds deals in great locations for us,” says Kurtz.

Kislak’s 22 salespeople in Woodbridge concentrate on New Jersey, and a team of three works out of offices in West Reading, Penn. and Stafford, Va. The firm’s parent company, J. I. Kislak in Miami Lakes, Fla., is an investor in residential properties.

Not a week passes without a Kislak-brokered deal closing. Last week, Kislak’s Co-managing Director Robert Holland and Associate Robert Squires helped sell a 24-unit apartment building in Roselle for $1.85 million on behalf of the Solomon Organization, a long-time investor client based in Mountainside. A week earlier, a Kislak team of Joni Sweetwood and Jacob Friedman closed the $7.3 million sale of a 216-unit apartment building in Philadelphia, representing both the buyer, SGAG Realty, and the seller, Hawthorne Associates.

“We are able to get the highest prices for our clients,” says Wiener, who, according to Holland, is so absorbed in deal making that “we try to get him to tuck his shirt in and wear his socks.”

Julius Kislak, from Hoboken, who started out knocking on doors, asking people if they would like to sell their homes, formed Kislak & Co. in 1906. Jason Kislak, his great-grandson and currently the youngest family member on board, says the firm is still guided by Julius’ strategy of asking four simple questions: “Are you buying? Are you selling? Do you know anybody who wants to buy? Do you know anybody who wants to sell?”

Jason, 31, Kislak’s director of marketing and operations, is keen on unlocking the potential of the firm. He would like to see Kislak emerge from its low-profile shell and “get the word out” to more investors, especially institutional players.

In 2002 Jason joined Kislak as an associate, after dropping out of a master’s course in geology at the University of Miami in Florida. He is one of four family members at the firm. His father John serves on the board of Kislak’s Florida parent company of which his grandfather Jay is chairman. Jay’s sister Sima Jelin is in her 80s, but still active as the firm’s broker of record—the person legally responsible for brokerage operations—and works out of the Woodbridge offices.

Holland, 45, is also mapping out new strategies for the firm. “I’ve reached out to more and newer institutional players, not just a Kamson or a Solomon or a Kushner,” he says. “Now we have public companies and pension funds that want to be in the [multifamily-investment] business.” He is also the public face of the firm’s efforts to expand into markets elsewhere in the region. “We want more in New York, Pennsylvania, Maryland, Delaware and Virginia,” says Holland.

Holland may not have Kislak in his name, but he certainly has it in his lineage: His grandfather, Solomon, spent his career at Kislak as president of its insurance division; his father, Frank, was in its mortgage finance department. Kislak has since shed both businesses to focus on brokerage.

Holland has been the firm’s top producer for about 10 years and last year sold portfolios worth more than $230 million. He currently has about a dozen deals on his plate.

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