Why Mack-Cali Sold Off $745M Over The Past Year

Mack Cali Centre III in Paramus, New Jersey
Courtesy of HFF
Among Properties For Sale Is Mack Cali Centre Iii In Paramus, N.j.

Mack-Cali announced yesterday that, over the past year, it has disposed of 36 non-strategic and underperforming commercial properties totaling approximately 5M SF, as well as a 220-unit multifamily community, for gross proceeds of $745M.

The REIT also redeployed more than $500M to acquire properties that fit its strategic growth plan, primarily focused on transit-based locations in Metropark, Jersey City, Hoboken, Weehawken and West New York.

Among its recent moves: exiting the DC metro by selling a seven-building portfolio in Greenbelt, Md.; exiting Freehold, Roseland and Cranford's office markets; and selling minority interests in numerous office assets held with Keystone Property Group. It is exploring up to $450M of additional property sales this year, including 26 buildings in Moorestown totaling 1.3M SF and nine buildings in Bergen County totaling 2.2M SF.

In addition to buying 100 Schultz, 200 Schultz and 230 Half Mile Road in Red Bank this year, Mack-Cali has agreed to purchase three buildings totaling 575k SF in Short Hills and three buildings totaling 525k SF in the Giralda Farms campus in Madison. Upon closing, the REIT will own nearly 100% of the Class-A office market in Short Hills, which commands some of the highest rents in the state.

“We believe we are well on our way to owning a totally Class-A portfolio,” Mack-Cali president Michael DeMarco said in a statement.

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