Mosser family fights for control of San Francisco real estate trust

CEO and family members battle in court over $1.5B apartment portfolio

Mosser Family Fights for Control of SF Real Estate Trust

From left: A photo illustration of Deborah Mosser and Neveo Mosser along with 840 Van Ness Avenue (left), 2360 Van Ness Avenue (middle) and 750 O’Farrell Street (right) (Getty, Mosser Companies, Google Maps, LinkedIn)

The Mosser family, among the biggest landlords in San Francisco, weathered the Great Recession but may not be able to overcome each other.

The blood behind the locally based Mosser Companies hit the boiling point last spring when the children of its late founder sued to have his successor, CEO Neveo Mosser, toppled from the family trust, the San Francisco Standard reported.

The Mosser real estate empire was founded in 1955 by the late Charles William Mosser, a World War II veteran turned law school dropout whose firm would amass $1.5 billion in assets, including 3,000 apartments in San Francisco, Oakland and Los Angeles. 

Before he died in 2007, the patriarch had five children, five marriages and five divorces. Two other children were disinherited from the trust.

Neveo Mosser, adopted into the family at a young age, was picked to run the company. Sisters Deborah Mosser and the late Kathleen Massouda each have a stake in the business, which at its height paid them six figures a month.

The booming business led to the founding of Mosser Capital, led by Neveo Mosser and his son-in-law Jim Farris, to finance a real estate buying spree.

Then Mosser Companies hit financial headwinds during the pandemic, based on falling rents and occupancy, and rising borrowing and repair costs.

In February, the firm defaulted on an $88 million loan tied to 12 apartment buildings with 459 units in San Francisco.

As multiple lenders, vendors and business partners began coming after the Mosser Companies’ assets, Deborah Mosser, her children and nephew — some of whom still work at the firm — turned on Neveo Mosser, according to the Standard.

In March, they asked the courts to remove him from the family trust, claiming his leadership steered it onto financial shoals.

Deborah Mosser said she learned of the company’s troubles through news reports, instead of its CEO, according to the complaint filed against her brother. Neveo Mosser categorically denied the claim in court. 

Arguing that these defaults would destroy their father’s trust and its beneficiaries, Deborah, through her attorneys, demanded Neveo provide a formal accounting of how the firm’s business had been conducted for the past 17 years.

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As the accounting department at the Mosser Companies was gathering its receipts, Deborah without warning asked the courts to suspend Neveo Mosser from the firm, the defense claimed, while she, her children and nephew worked to evict him from the trust. 

In their complaint, the extended Mosser family accused Neveo Mosser of not being candid about how he operated as head of the family business, and went on to accuse him of skimming profits that should have been reinvested back into the trust.

“Neveo is causing irreparable harm to the trust and its subtrusts every day,” the lawsuit reads. “Through a combination of mismanagement, commingling, and over-leveraging of trust properties for his own personal benefit and the benefit of non-trust assets and entities.”

In rebuttals, Neveo Mosser insists he was the only heir capable of managing the family’s business and was responsible for its growth. 

He also warned that a potential takeover by hs sister “threatens to throw the $1B portfolio into chaos,” since Neveo is the personal guarantor on loans and principal sponsor of portfolio properties.

In short, Neveo Mosser’s defense argued that it wasn’t mismanagement that tanked the business, but rather the domino effects of the pandemic, including the sudden collapses of Silicon Valley Bank and First Republic Bank.

In May, Superior Court Judge Ross Moody denied Deborah Mosser’s request to suspend her brother from acting on behalf of the trust. 

This month, employees from both Mosser Companies and Mosser Capital vacated their shared office at 220 Montgomery Street, in the Financial District. Deborah’s sons, Byrce and Jared Vree, continue to work at Mosser Companies.

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“The [Mosser] family dispute has no impact on our operational or fiduciary responsibilities,” Andrew Silverman, chief operations officer of Mosser Companies, said in a statement.

In court, Neveo and Deborah Mosser will continue presenting evidence until either a settlement is reached or the court is compelled to weigh in at trial. Mediation is not out of the question, legal experts say. 

As for the loans that have gone into default, Neveo Mosser told The Real Deal in an interview last month: “Ultimately, it’s up to the bank or the lender,” he said. 

— Dana Bartholomew

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