USAA is selling its controlling stake in USAA Real Estate (USAARE) to the current management of USAARE and a private investment group.
The financial services firm said it will retain a “significant ownership stake” in USAARE which was founded in 1982 as the property investment arm of USAA.
USAA said the sale, which is expected to close in early 2020, will help simplify its operating structure enabling it to better serve members through its core businesses of banking, auto, home and life insurance, and retirement products.
Len O’Donnell, president and CEO of USAARE will continue to lead the business, and the company will remain the exclusive investment manager for USAA’s real estate portfolio.
For USAARE, the deal reduces many financial service regulatory requirements for the business and allows it to grow in a more profitable way, USAA said.
USAA CEO Stuart Parker, said: “We believe both USAA and USAA Real Estate are best served by creating this strategic relationship and enabling the investment management business to operate more independently.
“We will continue to deliver on USAA’s mission to serve the financial needs of the military community with the quality, speed and service members expect and deserve.”
O’Donnell said: “This change enables us to provide an even greater level of service to our clients and partners as we strive to maximise performance for their portfolios.
”It creates a deeper and richer alignment between our clients, USAA and the management team, from which all will benefit immensely.”
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