This was just a water tower before the apocalypse.
Sometime after his encounter with Virginia, an unknown survivor found Morgan and hid him here, however, Morgan does not know who this survivor is. Morgan has been living in this water tower ever since and every day, he goes out and looks for supplies.
Morgan comes back after getting some supplies and avoiding the Pioneers. He stores his newly found supplies before heading out once again.
Later that day, Isaac and Morgan take refuge in the water tower. Isaac says that he found the hideout through the coordinates that Morgan had on his bag. Isaac asks Morgan for assistance in helping get to his wife, though, when rejected, Isaac desperately draws a gun on Morgan, until the tower is unexpectedly pulled down by Emile with his truck. Isaac exits the tower and sees Morgan aim the gun at Emile, telling Morgan to shoot him. After Morgan shoots him in the arm, Isaac and Morgan drive away in his truck.
On the run from The Pioneers, Morgan takes Virginia to the ruins of his old hideout to treat her wounds. Morgan has Virginia call Hill on the radio to prove that Daniel and Grace are okay and she complies. Looking next to her, Virginia spots a map and informs Hill that she's at a water tower near Grit. Morgan and Virginia discuss his survival after she shot him at Humbug's Gulch and she realizes that the hideout was for Grace. Morgan reveals that Dakota was the one who saved him and shows Virginia Dakota's note as proof. Virginia demands to be taken to Dakota, eventually revealing that Dakota is actually her daughter, not her sister.
Morgan and Virginia's discussion is interrupted by the arrival of the Outcasts, forcing them to flee.