A Houston-based commercial real estate firm is offloading $5.5B worth of assets as its parent company plans to exit the business amid reports of leadership conflict.
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Ameriprise Financial Inc. plans to wind down Lionstone Investments, its U.S. real estate investment subsidiary, according to a statement shared Tuesday. The decision comes after a strategic evaluation, according to the statement, and seven years after Ameriprise's subsidiary Columbia Threadneedle Investments acquired Lionstone.
“The company is fully supporting Lionstone’s clients as it transitions their assets in an orderly way to new investment managers,” Ameriprise said in the statement, adding that it expects financial implications for Ameriprise to be immaterial.
The business had about $5.5B in institutional assets as of Sept. 30, including multifamily, retail, office and mixed-use properties in markets across the country, including Houston, Washington, D.C., and Los Angeles.
Assets listed on Lionstone’s website include One American Center, a 32-story office tower in Downtown Austin. Lionstone had tried to offload that building multiple times starting before the pandemic. Lionstone serves as the financial advisor for the building’s owner, the California State Teachers' Retirement System, according to the Austin Business Journal.
Lionstone Investments announced in June that it acquired The James, an eight-story, Class-A multifamily asset in Houston’s River Oaks. All of Lionstone’s assets are “expected to transition over the next several months,” Ameriprise said in its statement.
The wind-down of the business comes as tension grew between Lionstone’s leadership team and Columbia Threadneedle Investments, the Boston-based subsidiary that acquired Lionstone in November 2017, the Houston Business Journal reported, citing unnamed sources.
“There were a lot of points of disagreement between Lionstone and the parent company,” an unnamed source said.
Dan Dubrowski, chairman and co-founder of Lionstone Investments, left the firm effective Oct. 1. The other two co-founders left to start their own investment firms.
Tom Bacon is the co-founder and managing partner of Civicap Partners and Glenn Lowenstein is the CEO of Stablewood. Both men’s company bios cite the 2017 sale of Lionstone Investments as the conclusion to their time there.
Lionstone was founded in 2001 as a privately owned real estate firm focused on national investment strategies, according to its website.
A Lionstone spokesperson and a Columbia Threadneedle Investments spokesperson declined to comment, and Bacon, Dubrowski and Lowenstein did not respond to HBJ’s requests for comment, according to the article.
Lionstone has 53 employees, and its headquarters office is at the JPMorgan Chase Building at 712 Main St. in Downtown Houston, where it occupies about 11K SF, the HBJ reported. An entity tied to Lionstone sold 712 Main to The Wideman Co. in May.
Ameriprise “remains focused on growing its Alternatives business profitably, with significant opportunity in UK and European real estate, as well as with its hedge funds, CLOs and private equity,” the company said in its statement.
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