The Real Deal New York

Meet the “A” in A&E Real Estate

Multifamily heavyweight tied to John Arrillaga Jr., son of Silicon Valley billionaire
By Mark Maurer | Twitter_logo_blue copy December 18, 2015 03:40PM

A&E Real Estate Holdings, which has quietly grown into one of New York City’s top multifamily buyers in just a few years, has a secret up its sleeve: its co-founder.

While Douglas Eisenberg, the former Urban American Management executive, is known to run A&E, he shares ownership of the Midtown-based firm with John Arrillaga Jr., son of billionaire Silicon Valley real estate developer John Arrillaga.

Eisenberg teamed up with Arrillaga Jr. in 2011 to form A&E, which now has about $2 billion in assets and owns around 10,000 rental units throughout the city, according to sources. This year alone, the firm acquired more than $800 million in rental properties, including a 32-building portfolio across three boroughs and a $201 million city-brokered deal to buy the Riverton Houses in Harlem.

Despite these ambitious plays, A&E has flown under the radar, keeping its origins and heavyweight connections largely hidden from view.

Arrillaga Jr., a Northern California native, continues to serve as a principal at his father’s Palo Alto-based office development firm Peery Arrillaga. He previously worked at private equity firm Apollo Real Estate Advisers, now called AREA Property Partners. The latter firm aggressively bought rent-stabilized multifamily buildings in Manhattan and the outer boroughs during the mid-2000s boom, but took a hit following the downturn.

His father, who Forbes estimated is worth $2.3 billion, is credited with buying California fruit orchards in the 1960s and converting the land to office parks that now house the likes of Apple, Google and LinkedIn. He is also a driving force and a big benefactor behind the expansion of his alma mater Stanford University, where the family name adorns several buildings.

A spokesperson for A&E said Arrillaga Jr. focuses on day-to-day operations, financings and acquisitions.  Arrillaga Jr. splits his time between New York and California, where he is involved with his family’s business as well as other non-real estate business ventures.

On paper, Eisenberg and Arrillaga Jr., who declined to comment, have several similarities. They are both in their mid-40s and heirs to a successful family real estate business that have since branched out on their own.

Eisenberg’s father, Philip Eisenberg, is a principal at West New York, N.J.-based Urban American, which owns tens of thousands of apartments in the New York area. Last year, the firm sold a stake in the nearly 4,000-unit Putnam portfolio to Brookfield Property Partners for $1.04 billion.

Adam Pincus contributed reporting.