Mack-Cali Realty Corp. has locked up nearly $420 million in its push to raise cash for multifamily projects by selling non-core office buildings, the company said this week.
The proceeds will come from the sale of nine office properties, including five in New Jersey, and a joint venture that stands to net the company $233 million from the sale of a 15-building portfolio in suburban Philadelphia.
In a second-quarter earnings call Thursday, CEO Mitchell Hersh took stock of Mack-Cali's strategy since acquiring Roseland Property Co., the Millburn-based luxury multifamily builder, as part of an expansion beyond its longtime business model as an office landlord.
"We've put ourselves in a position, with our asset recycling and disposition program, of self-funding our Roseland business at the present time," Hersh said, noting the company has several ongoing construction projects or acquisition prospects in its pipeline.
The Edison-based real estate giant has moved quickly on the strategy since acquiring Roseland in October. Last week, it announced its joint venture with a fund sponsored by Keystone Property Group that will allow it to shed nearly 1.7 million square feet of Pennsylvania office space while gaining multifamily development rights for nearby land.
The sale of nine other office properties around the region has helped Mack-Cali bring in $136 million. Hersh indicated the company might be winding down the selling spree, saying, "I expect this to sort of be the cap at the present time."
The company's commercial properties are about 86 percent leased after recording 1.3 million square feet of leasing activity during the second quarter, according to its earnings information. New leases accounted for some 400,000 square feet of that total, including a 75,000-square-foot deal by American General Life Insurance Co. at 3600 Route 66, in Neptune.
Reporter Joshua Burd is @JoshBurdNJ on Twitter.
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