Mack-Cali Realty Corp.
), a real estate investment trust (REIT), reported FFO (funds from
operations) of $62.1 million or 62 cents per share in the second
quarter of 2012, compared with $69.1 million or 69 cents in the
Reported FFO per share in the quarter beat the Zacks Consensus
Estimate by a penny. Total revenue was $178.5 million during the
reported quarter versus $179.2 million in the year-ago period.
Mack-Cali executed strong leasing activities during the quarter.
The company executed 139 leases at its consolidated in-service
portfolio spanning 0.9 million square feet, including 0.7 million
square feet of office space and 0.2 million square feet of
Of the total leased space, 0.3 million square feet were for new
leases and 0.6 million were for lease renewals and other tenant
retention transactions. The consolidated in-service portfolio of
the company was 87.6% leased at quarter end compared with 87.9% in
the previous quarter.
Subsequent to the end of the quarter, Mack-Cali signed a ground
lease with Wegmans Food Markets for a site in Hanover Township, New
During the quarter, Mack-Cali completed the sale of $300 million
worth of 4.50% senior unsecured notes scheduled to mature in April
18, 2022. The company utilized the net proceeds of $296.8 million
to repay outstanding debt under its revolving credit facility.
Additionally, Mack-Cali redeemed $94.9 million of its 6.15%
senior unsecured notes scheduled to mature in December 15, 2012 and
$26.1 million of 5.82 % senior unsecured notes due March 15,
2013. The company funded the redemption price of
approximately $127.9 million from borrowing on its unsecured
revolving credit facility as well as cash on hand.
During the reported quarter, Mack-Cali declared a quarterly cash
dividend of 45 cents per share, which equates to an annualized
distribution of $1.80 At quarter-end, the company had total
debt of $1.9 billion, with a debt-to-undepreciated assets ratio of
33.9%, an interest coverage ratio of 3.0x, and cash and cash
equivalents of $19.3 million. For fiscal 2012, the company expects
FFO in the range of $2.52 -$2.62 per share.
Mack-Cali currently retains a Zacks #3 Rank, which translates
into a short term Hold rating. We maintain our long-term
Neutral recommendation on the stock. One of its competitors,
Boston Properties Inc
) also holds a Zacks #3 Rank.
Note: FFO, a widely used metric to gauge the performance of
REITs, is obtained after adding depreciation and amortization and
other non-cash expenses to net income.
BOSTON PPTYS (BXP): Free Stock Analysis Report
MACK CALI CORP (CLI): Free Stock Analysis
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