Mack-Cali sells Short Hills, NJ office portfolio for $255M
Buyer Birch Group sees repositioning opportunity
Mack-Cali Realty’s selling spree continues: The REIT sold its Short Hills, New Jersey office portfolio to the Birch Group for $255 million, the companies announced.
The sale includes four buildings on John F. Kennedy Parkway totaling 843,300 square feet. The buildings are in various states of being filled, with some 100 percent leased and others only 52 percent leased. Current tenants include Citibank, Investors Bank, KPMG, Bank of America, UBS, Dun & Bradstreet, Morgan Stanley and Wells Fargo.
The REIT has been selling off its suburban office properties in recent years to realign its portfolio. The company last month sold its four-building Metropark complex in Edison and Iselin, New Jersey, to Opal Holdings, a New York City REIT, for $254 million. Mahbod Nia, Mack-Cali’s CEO, said the Short Hills sale would help the company “generat[e] liquidity to pay down corporate debt and strengthen our balance sheet.”
The Birch Group, a privately-held commercial real estate investment firm based in Nanuet, New York, saw the acquisition as a repositioning opportunity.
“Our focus will be on enacting tailored improvement strategies to create enduring value for our tenants and investors alike,” Birch Group CEO and founder Mark Meisner said in a statement.
Cushman & Wakefield’s David Bernhaut led a team of brokers representing Mack-Cali, and the firm has been retained by the Birch Group as the leasing agent for the properties.
The Birch Group is expanding its suburban office portfolio in a market where the current supply exceeds the demand. New Jersey’s office availability rate in the first quarter climbed to 21.6 percent, up 4 percentage points compared to the same time last year, according to a report from Avison Young New Jersey.