Mack-Cali Leases NJ Office Asset - Analyst Blog

By Zacks Equity Research,

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Mack-Cali Realty Corp . ( CLI ) along with The Praedium Group, its joint venture (JV) partner, disclosed a new lease agreement with Sedgwick, LLP for 26,074 square feet of space at Class A office tower - One Newark Center - in New Jersey. Sedgwick, LLP is a San Francisco-based international litigation and business law firm.

One Newark Center, located advantageously at downtown Newark, is a 24-story building spanning 416,429 square foot. The fully furnished property is situated close to Newark Penn Station as well as Newark Liberty International Airport. The 98.4% leased office property is occupied by the IRS, the Newark Club, Seton Hall University Law School, The United States Trustees office and Kirkpatrick & Lockhart.

In the transaction, executives of Studley, Inc. represented Sedgwick. On the other hand, Mack-Cali and The Praedium Group were represented by personnel's of Jones Lang LaSalle Inc. ( JLL ), which is the exclusive leasing agent for One Newark Center.

We expect this leasing transaction of Mack-Cali to boost its strong tenant base and prove accretive to its earnings going forward. Notably, to counter the continued weakness in the company's core office markets, Mack-Cali has been divesting a notable part of its office portfolio and deploying its capital to expand its holdings in the multi-family residential sector that has traditionally been more of a stable product type.

Yet, the aggressive disposition of office assets would continue to have a dilutive impact on its financials in the near-to-medium term. Moreover, with rents on the renewals rolling down in its core office portfolio, this Zacks Rank #5 (Strong Sell) stock lacks sufficient growth momentum.

Investors interested in the REIT industry may consider stocks like Getty Realty Corp. ( GTY ) and Pebblebrook Hotel Trust ( PEB ). Both these stocks carry a Zacks Rank #1 (Strong Buy).

MACK CALI CORP (CLI): Free Stock Analysis Report

GETTY REALTY CP (GTY): Free Stock Analysis Report

JONES LANG LASL (JLL): Free Stock Analysis Report

PEBBLEBROOK HTL (PEB): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Stocks
Referenced Stocks: CLI , GTY , JLL , PEB

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