Founded in 2003, Meritage Properties is a value-oriented owner/operator of mid-sized properties, primarily focused on the Boston to Washington, D.C. corridor. Our guiding principle is that a compelling business model can be achieved, and meaningful value created, by combining disciplined underwriting metrics, best in class operating principles, outstanding business reputation and ethics, and an unwavering commitment to excellence. Our firm’s approach is predicated on the notion that each property transaction, from conceptualization through disposition, is “touched and informed” by the same individuals, allowing for a continuity of philosophy, clarity of direction, and thoughtful commitment to plan. Our intense focus on a handful of dynamic and complementary metropolitan markets combined with our hands-on approach to management also reinforces the development of deep local market knowledge and the fostering of particularly close community relationships. Since inception, Meritage Properties has acquired interests in approximately 3.2 million square feet of office space and 500 residential units, valued at over $750 million.
Our analysis of new portfolio acquisitions is robust, and our follow-through as owners proactive rather than responsive. Each target property is subjected to a combination of in-depth senior level focus, applied broad market knowledge, and rigorous analytics to arrive at a rational, capital markets “trend–independent” and highly confident valuation point. We excel along the Core Plus through Opportunistic real estate spectrum, having established a well-respected expertise at repositioning and rebranding challenged properties. We have successfully overcome a variety of issues, including assessing/addressing difficult environmental issues, undertaking systems and structural repairs and replacements, and implementing new marketing and leasing initiatives and programs.
Once an acquisition is completed, we move aggressively to implement our strategic plan, relying on in-house asset and property management teams to execute our vision. Our team works closely with market savvy architects, engineers and contractors on all aspects of design and construction to ensure a cost-effective, high-quality finished product. We are involved day to day with leading local market leasing agents in the positioning of our properties and leasing of space, placing significant emphasis on tenant service and retention. We demand nothing less than market-leading absorption and retention rates, resulting in increased long-term stability for our buildings. Having adopted first-class operating reporting systems as well as state-of-the-art management processes, we utilize key information and metrics to monitor our portfolio continually to maintain an in-depth understanding of asset performance in order to achieve our short- and long-term objectives.
Our property management platform, a unique partnership with Lincoln Property Company, affords an unparalleled blend of capabilities of our two organizations. This combination delivers best-in-class service and total scalability, merging the detail-oriented bottom-line focus of an owner/operator and the implicit leverage and powerful infrastructure of a large national property management organization. Meritage is responsible for the primary oversight, direction and supervision of all on-site activities and services, maintaining a hands-on approach to all aspects of property management. Lincoln supports our pre-acquisition diligence activities as well as our portfolio operations by providing on-site staffing and regional support through their extensive network of property management personnel, engineers, construction management teams and sub-specialists, as well as access to their national operating infrastructure and buying power. Lincoln’s platform also provides an established base for “best-in-class” procedures and policies for a consistent, proven and thoughtful approach to the management process. Meritage and Lincoln have successfully advanced this joint platform across 15 properties totaling over 2 million square feet, developing a dynamic working relationship with outstanding results.
Meritage Properties has always been envisioned as a new firm with “old fashioned” values, bringing together a proprietary approach to financial analytics, cutting edge reporting systems and an entrepreneurially-biased yet institutional-quality mind-set. We are at the core a firm built around intellectual capital, and the brand we have created over the past 11 years reflects the dedication and experience of a relatively small but nimble group of supremely talented real estate professionals, each with a complementary set of core competencies who share the same perspective and vision. Working together as a highly coordinated team, we possess the capability to respond quickly and effectively to seize market opportunities and resolve issues as they arise.
We are proud of the reputation we have earned, as well as the success of our holdings to date. Like all of our colleagues in the industry, our vintage 2004 to 2008 investments were meaningfully impacted by the Great Recession; our flexibility further impacted by timing and capital constraints inherent in our specific fund investment structures. We have nonetheless achieved an aggregate 1.27x return on the $128 million of equity invested in properties sold to date. Moreover, focusing solely on individually owned properties which were not subject to the more limited investment criteria, holding period, leverage threshold, and other restrictions of our fund format, our aggregate realized equity multiple is 1.74x, and our aggregate internal rate of return is 24.4.%.