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Section 1: 8-K (8-K)

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 


 

FORM 8-K

 


 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

Date of report (Date of earliest event reported): September 25, 2018

 


 

MACK-CALI REALTY CORPORATION

(Exact Name of Registrant as Specified in Charter)

 

Maryland

 

1-13274

 

22-3305147

(State or Other Jurisdiction
of Incorporation)

 

(Commission File Number)

 

(IRS Employer
Identification No.)

 

Harborside 3, 210 Hudson St., Ste. 400
Jersey City, New Jersey 07311

 

(Address of Principal Executive Offices) (Zip Code)

 

 

(732) 590-1010

(Registrant’s telephone number, including area code)

 

MACK-CALI REALTY, L.P.

(Exact Name of Registrant as Specified in Charter)

 

Delaware

 

333-57103

 

22-3315804

(State or Other Jurisdiction
of Incorporation)

 

(Commission File Number)

 

(IRS Employer
Identification No.)

 

Harborside 3, 210 Hudson St., Ste. 400
Jersey City, New Jersey 07311

 

(Address of Principal Executive Offices) (Zip Code)

 

 

(732) 590-1010

(Registrant’s telephone number, including area code)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

o      Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o      Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o      Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).    Emerging growth company o

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  o

 

 

 



 

Item 7.01 Regulation FD

 

Beginning on September 25, 2018, Mack-Cali Realty Corporation, a Maryland corporation (the “General Partner”) and the general partner of Mack-Cali Realty, L.P. (the “Company,” and together with the General Partner, the “Registrants”), will participate in investor meetings and the BofA Merrill Lynch Global Real Estate Conference at which members of the General Partner’s management will make a presentation to investors. A copy of the General Partner’s investor presentation is furnished herewith as Exhibit 99.1.

 

Limitation of Incorporation by Reference

 

In accordance with General Instruction B.2. of Form 8-K, this information, including Exhibit 99.1 furnished herewith, is furnished pursuant to Item 7.01 and shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be incorporated by reference into a filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act. The information in this Item 7.01 of this Current Report on Form 8-K (including the exhibit hereto) will not be deemed an admission as to the materiality of any information required to be disclosed solely to satisfy the requirements of Regulation FD.

 

Cautionary Statements

 

This Current Report on Form 8-K, including the exhibits furnished herewith, contains “forward-looking statements” within the meaning of Section 21E of the Exchange Act. Such forward-looking statements relate to, without limitation, our future economic performance, plans and objectives for future operations and projections of revenue and other financial items. Forward-looking statements can be identified by the use of words such as “may,” “will,” “plan,” “potential,” “projected,” “should,” “expect,” “anticipate,” “estimate,” “target,” “continue,” or comparable terminology. Forward-looking statements are inherently subject to risks and uncertainties, many of which we cannot predict with accuracy and some of which we might not even anticipate. Although we believe that the expectations reflected in such forward-looking statements are based upon reasonable assumptions at the time made, we can give no assurance that such expectations will be achieved. Future events and actual results, financial and otherwise, may differ materially from the results discussed in the forward-looking statements as a result of various factors. Unless required by U.S. federal securities laws, we do not intend to update any of the forward-looking statements to reflect circumstances or events that occur after the statements are made or to conform the statements to actual results. The information contained in this Current Report on Form 8-K, including the exhibit filed herewith, should be viewed in conjunction with the consolidated financial statements and notes thereto appearing in the Registrants’ Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q.

 

In connection with the foregoing, the Company and Operating Partnership hereby furnish the following documents:

 

Item 9.01              Financial Statements and Exhibits

 

(d)  Exhibits

 

Exhibit Number

 

Exhibit Title

 

 

 

99.1

 

Investor Presentation.

 

The information included in this Current Report on Form 8-K (including the exhibit hereto) is being furnished under Item 7.01, “Regulation FD” and Item 9.01 “Financial Statements and Exhibits” of Form 8-K. As such, the information (including the exhibit) herein shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall it be incorporated by reference into a filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. This Current Report (including the exhibit hereto) will not be deemed an admission as to the materiality of any information required to be disclosed solely to satisfy the requirements of Regulation FD.

 

2



 

EXHIBIT INDEX

 

Exhibit Number

 

Exhibit Title

 

 

 

99.1

 

Investor Presentation.

 

3



 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, each registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

MACK-CALI REALTY CORPORATION

 

 

 

Dated: September 25, 2018

By:

/s/ Gary T. Wagner

 

 

Gary T. Wagner

 

 

General Counsel and Secretary

 

 

 

 

MACK-CALI REALTY, L.P.

 

 

 

 

By:

Mack-Cali Realty Corporation,

 

 

its general partner

 

 

 

Dated: September 25, 2018

 

By:

/s/ Gary T. Wagner

 

 

 

Gary T. Wagner

 

 

 

General Counsel and Secretary

 

4


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Section 2: EX-99.1 (EX-99.1)

Exhibit 99.1

. Mack-Cali Realty Corporation Investor Presentation BAML Conference September 2018

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2 Statements made in this presentation may be forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements can be identified by the use of words such as “may,” “will,” “plan,” “potential,” “projected,” “should,” “expect,” “anticipate,” “estimate,” “target,” “continue” or comparable terminology. Forward-looking statements are inherently subject to risks and uncertainties, many of which we cannot predict with accuracy and some of which we might not even anticipate, and involve factors that may cause actual results to differ materially from those projected or suggested. Readers are cautioned not to place undue reliance on these forward-looking statements and are advised to consider the factors listed above together with the additional factors under the heading “Disclosure Regarding Forward-Looking Statements” and “Risk Factors” in our annual reports on Form 10-K, as may be supplemented or amended by our quarterly reports on Form 10-Q, which are incorporated herein by reference. We assume no obligation to update or supplement forward-looking statements that become untrue because of subsequent events, new information or otherwise. This Operating and Financial Data should be read in connection with our Quarterly Report on Form 10-Q for the quarter ended June 30, 2018.

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3 Jersey City Portfolio Overview Mack-Cali has a leading residential and office presence in Jersey City’s premier market 4 Residential Units Office SF Future Developments Transportation 2 3 1 5 6 7 8 14 15 16 17 9 10 11 13 12 Urby (762 Units) Marbella (412 Units) M2 (311 Units) Monaco (523 Units) 101 Hudson (1.2 MSF) Harborside 4A (0.2 MSF) Harborside 5 (1.0 MSF) Harborside 1,2,3 (1.9 MSF) 25 Christopher Columbus Harborside 8 Urby II Harborside Tower Exchange Place PATH NY Waterway - Harborside NY Waterway - Paulus Hook Light Rail - Harborside

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2Q 2018 Key Statistics (1) Square Feet Office Space % Leased (Excl. Non-Core) GAAP Rental Rate Roll-Up (Excl. Non-Core) Cash Rental Rate Roll-Up (Excl. Non-Core) Operating Residential Units % Leased Residential Units In-Construction Residential Units/Keys 6,082 97.5% 2,001 Market Capitalization Net Asset Value (Estimate) $3.6 billion $5.0 billion 15.5 million 83.2% 16.5% 7.5% Pictured: Harborside Financial Center 4 In-Construction Avg Development Yield 7.0% Notes (1) All data as of June 30, 2018.

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5 Office buildings (Excluding Flex) Operating/In Construction Units (WO/JV) Operating/In Construction Units (Subordinate) Total Market Cap Weighted Average Interest Rate Interest Coverage Ratio Core FFO (Qtr.) 42 (63% Reduction) 7,953 (109% Increase) 130 (96% Reduction) $5.0 billion (28% Increase) 3.79% (33% Reduction) 3.5 (30% Increase) $45.2 million (3% decrease) AFFO (Qtr.) $21.1 million (14% decrease) Comprehensive Transformation Office Buildings (Excluding Flex) Operating/In Construction Units (WO/JV) Operating/In Construction Units (Subordinate) Total Market Cap Weighted Average Interest Rate Interest Coverage Ratio Core FFO (Qtr.) AFFO (Qtr.) 115 3,800 3,026 $3.9 billion 5.67% 2.7 $46.5 million $24.5 million 2Q15 2Q18 Pictured: Jersey City Waterfront Assets Consolidated Residential NOI (Annualized) $14.3 million Consolidated Residential NOI (Annualized) $47.8 million (234% Increase)

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NOI Evolution 6 Total Portfolio NOI: $335M 69% of NOI from Preferred Business Segments Total Portfolio NOI: $357M 37% of NOI from Preferred Business Segments Market NOI % Waterfront Office $82 23% Residential 28 8% Class A Suburban Office 23 6% Subtotal $133 37% Suburban Office 170 48% Flex 54 15% Total $357 100% $ in millions Mack-Cali has transformed its business from a suburban office company to a dual platform residential and geographically focused office company Market NOI % Waterfront $104 31% Residential 80 24% Class A Suburban 46 14% Subtotal $230 69% Suburban 67 20% Flex 38 11% Total $335 100% Market NOI % Waterfront $104 28% Residential 119 32% Class A Suburban 46 12% Subtotal $269 72% Suburban 67 18% Flex 38 10% Total $374 100% Total Portfolio NOI: $374M 72% of NOI from Preferred Business Segments 48% 15% 8% 23% 11% 24% 31% 10% 32% 28% 18% 14% 12% 20% Class A Suburban Class A Suburban Class A Suburban 7% Residential Waterfront Suburban Flex Residential 2Q 2018 NOI Composition (annualized) Waterfront Suburban Flex Residential NOI Composition W/ CIP Stabilized (annualized)

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Residential – 2018 Lease Up Success 7 The Company has delivered 1,212 units to the marketplace in 2018, which are collectively 63.9% leased as of September 17, 2018 Highlighting this success is the absorption of RiverHouse 11. The property opened on July 6, 2018 and is currently 84.1% leased (248 units) Phase I Phase II Units 295 296 197 237 128 59 Location Weehawken, NJ East Boston, MA Morris Plains, NJ Worcester, MA Morristown, NJ Commenced Operations July 6, 2018 May 4, 2018 March 24, 2018 February 24, 2018 July 23, 2018 April 23, 2018 Units Absorbed 248 182 140 140 16 47 Percent Leased 84.1% 61.5% 71.1% 59.0% 13.3% 79.7% Development Yield 6.60% 6.79% 6.68% 6.21% 6.72% Stabilized Cash Flow $4.7 million $4.2 million $2.2 million $3.6 million $0.3 million RiverHouse 11 Portside 5/6 Signature Place 145 Front Street Metropolitan Lofts

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Residential – Market Leading Portfolio 8 As of 2Q 2018, Roseland had a portfolio-wide percentage leased of 97.5% Roseland’s low volatility portfolio has leased within a 200 bps range over last three years, which management believes is supportive of higher loan-to-value debt Roseland’s portfolio has an average age of under 9 years – an industry leader With the Marbella acquisition, we have nearly eliminated our subordinated interests (130 units remain) Gross Portfolio Value Stabilized Gross Asset Value $4,484 Less: Discount for CIP (97) Discounted Gross Asset Value $4,387 Less: Existing Debt (1,904) Less: 3rd Party Interests (696) Roseland Net Asset Value $1,787 MCRC Share $1,555 Rockpoint Share $232 Historical Percentage Leased 92.0% 94.0% 96.0% 98.0% 100.0% 4Q14 2Q15 4Q15 2Q16 4Q16 2Q17 4Q17 2Q18 % Leased Average Hudson River Waterfront 61.8% Boston Metro 20.9% NJ Corridor 9.1% Washington, D.C. 5.8% New York Metro 1.6% Philadelphia Metro 0.8% NAV by Market 9.7 8.5 8.9 8.9 7.5 8.0 8.5 9.0 9.5 10.0 2017 2018 2019 2020 Avg Building Age Projection (years)

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Residential – Value Creation Estimated Value Creation from In-Construction Projects Projected NOI $61.2M Market Value of Projected NOI 1,194.7M Less: Cost of Development - 875.0M Value Creation $319.7M Roseland Share $269.8M 9 Roseland’s In-Construction and lease-up portfolio is forecasted to create approximately $319.7 million of value through 2020 (Roseland share: $269.8M). 145 Front Street at City Square (365 Units) Phase I - 1Q 2018 Delivery Phase II - 3Q 2018 Delivery Portside 5/6 (296 Units) 2Q 2018 Delivery RiverHouse 11 at Port Imperial (295 Units) 2Q 2018 Delivery Building 8/9 at Port Imperial (313 Units) 4Q 2020 Delivery Marriott Hotels at Port Imperial (372 Keys) 3Q 2018 Delivery Riverwalk C at Port Imperial (360 Units) 4Q 2020 Delivery Current Development Pipeline

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Residential - Development Delivery and FFO Creation 10 2019E: $28.7 M 2020E 1: $38.2 M 2018E: $13.7 M Pictured: Monaco Jersey City The growth reflected below is solely from Roseland’s current Operating and In-Construction portfolio Economic Stabilizations Quarry Place at Tuckahoe – 108 Units ($1.1M) Chase II – 292 Units ($2.7M) Urby at Harborside – 762 Units ($9.9M) Economic Stabilizations Signature Place at Morris Plains – 197 Units ($2.2M) Lofts at 40 Park – 59 Units ($0.3M) 145 Front Street at City Square – 365 Units ($3.6M) RiverHouse 11 at Port Imperial – 295 Units ($4.7M) Portside 5/6 – 296 Units ($4.2M) Economic Stabilizations Marriott Hotels at Port Imperial – 372 Keys ($9.5M) Notes (1) 2020 incremental FFO creation excludes proceeds from the late 2020 delivery of Riverwalk C and Building 8/9. $0 $10 $20 $30 $40 $50 $60 $70

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Residential – Equity Requirements 11 As summarized in the table below, Mack-Cali is planning on and expects to have excess capital sources available to achieve the following key objectives: Complete Roseland’s in-construction portfolio of 2,001 units Complete Roseland’s funding requirement for 2018/2019 Priority Starts comprising 2,673 units Notes: (1) Represents capital sources prior to reinvestment of Roseland cash flow generation. $ in thousands

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Office – Rent Growth by Property Type 12 The Company achieved GAAP roll-ups of 16.5% across its core portfolio and 12.2% at waterfront assets Waterfront rents continue to climb as the Company focuses on its trophy assets As waterfront rents continue to climb, management believes re-leasing previously discounted prime office space presents a sizeable mark to market opportunity FY 2015 FY 2016 FY 2017 FY 2018 (1) Waterfront $34.36 $40.45 $48.88 $49.99 % 17.7% 20.8% 2.3% Class A Suburban 29.42 32.71 34.29 $32.21 % 11.2% 4.8% (6.1%) Suburban 23.37 27.50 27.53 $28.50 % 17.7% 0.1% 3.5% Key Markets (avg) $25.72 $34.54 $38.72 $37.84 % 34.3% 12.1% (2.3%) $21.74 $20.60 $23.58 $25.32 Portfolio Re-Leasing Spreads (GAAP) $40.56 $42.88 $48.88 $45.52 Waterfront Re-Leasing Spreads (GAAP) $48.91 $40.97 $34.15 $39.76 2018 Escalations Notes: (1) 2018 GAAP new rents signed based on leases signed in 1Q and 2Q 2018 and projections to the end of the year. $15.00 $20.00 $25.00 $30.00 $35.00 $40.00 $45.00 $50.00 FY 2015 FY 2016 FY 2017 FY 2018 (1) New Rents Signed by Property Type (GAAP) Waterfront Class A Suburban Suburban Average

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($ in millions) Percent of Goal Buildings Building SF Avg. Base Rent Dispositions (2015 – YTD 2018) $1,435.2 90.6% 143 16,002,167 $25.17 Under Contract/Negotiations 131.1 8.3% 6 766,563 24.44 Active Dialogue/Future Dispositions 17.1 1.1% 2 194,714 24.49 Total Dispositions $1,583.4 100% 151 16,963,444 $25.12 Total Remaining Portfolio 98 13,404,219 $30.29 Remaining Flex Parks 62 3,526,612 18.46 Remaining Office Portfolio 36 9,877,607 $34.51 Under Contract/Negotiations $131.1M 2015 - 2018 Dispositions $1,435.2M We have made significant progress in our portfolio transformation via dispositions of non-core and JV assets and expect to finish our program in 2018. The average rent profile of our remaining office portfolio is 37.4% higher than the disposition portfolio . Office - Disposition Strategy & Statistics 13 Disposition Target $1,583.4M 91% 8% Remaining to reach target $17.1M 1% The remaining office portfolio avg. rent is 37.4% higher than the portfolio dispositions

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Office – Post Disposition Portfolio 14 Excludes non-core holdings targeted for sale at 842,086 SF; excludes consolidated repositionings taken offline totaling 513,101 SF. Total consolidated office portfolio of 15,920,449 SF. Includes annualized base rental revenue plus escalations for square footage leased to commercial and retail tenants only. Excludes leases for amenity, parking and month-to-month tenants. Annualized base rental revenue plus escalations is based on actual June 2018 billings times 12. For leases whose rent commences after July 1, 2018 annualized base rental revenue is based on the first full month’s billing times 12. As annualized base rental revenue is not derived from historical GAAP results, historical results may differ from those set forth above. Average base rents + escalations reflect rental values on a triple net basis. * Denotes assets that have recently been renovated The Company allocated an aggregate $53.7 million to capital improvements at office assets in 2017 and projects to spend an additional $60.6 million in 2018

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Office – Waterfront Leasing Prospects 15 4Q 2017 SF (Thousand) Looking ahead to 2019 and beyond, Mack-Cali will be in an excellent position to capitalize on the momentum provided by our building improvements, new leases signed, and the continued enhancement of the Jersey City Waterfront’s reputation as the place to work, live, and play. The pace of conversion from prospect to signed lease is beginning to accelerate, providing a positive outlook. AVG SF Requirement 14,319 28,796 38,695 12,500 The New Lobby for Harborside 2&3 (Opened June 2018) 818,270 SF 286,274 SF GAAP Cash SF Outgoing Rent PSF Incoming Rent PSF Roll Up Outgoing Rent PSF Incoming Rent PSF Roll Up New Deals 8,334 $45.08 $46.78 3.8% $49.34 $47.00 (4.7%) Renewals 42,680 45.48 48.56 6.8% 49.19 50.36 2.4% 51,014 $45.42 $48.27 6.3% $49.21 $49.81 1.2% Q1 & Q2 2018 Waterfront Roll Up 1 1 7 9 7 6 6 4 2 4 0 5 10 15 101 Hudson Harborside 5 Harborside 2&3 111 River Tours Per Quarter Q1 Q2 Q3 to Date # Tours

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16 Valuation – NAV 2Q 2018 $ in millions (except per share amounts) Notes: See appendix for additional information The company’s NAV estimate of $3.6B is further supposed using alternative valuation methodologies on page 17

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Office Portfolio Value Price-to-FFO Multiple Sensitivity 2018 Office Portfolio FFO(3): $1.51/share Valuation - Implied Stock Price Office FFO Multiple Office Company Value Per Share Roseland Value Per Share Implied Stock Value 11.00x $16.61 $15.46 $32.07 12.00x 18.12 15.46 33.58 13.00x 19.63 15.46 35.09 14.00x 21.14 15.46 36.60 15.00x 22.65 15.46 38.11 Mack-Cali Stock Price(1) $20.62 2Q 2018 CLI Share of Roseland Net Asset Value Per Share 15.46 Implied Office Company Value Per Share(2) $5.16 Implied Office Company FFO Multiple 3.42x 17 Note: As of September 21, 2018 The office standalone net debt/EBITDA is 8.1x See Appendix for additional guidance detail As reflected in the sum of parts NAV calculation, a stock price of $35.93 is further validated by a cash flow multiple approach:

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Mack-Cali’s residential and core office assets are concentrated in targeted urban markets and transit based locations, with approximately 74% of NAV along the Hudson River Waterfront. Geographic Breakdown Hudson River Waterfront NAV ($) NAV (%) Office (Jersey City, Hoboken) $1,570M 43% Residential (Jersey City / Port Imperial) 1,113M 31% Total $2,683M 74% 18 Port Imperial Waterfront Jersey City Waterfront

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Regional Spotlight - Jersey City 19 Mack-Cali and Roseland have a market leading residential & office portfolio along the Jersey City Waterfront. Residential Units % Leased (6/30/18) Rent PSF (6/30/18) Marbella 412 97.3% $40.66 Monaco 523 97.1% 45.03 M2 311 97.1% 46.36 Urby 762 99.3% 58.84 Total 2,008 98.0% $49.58 Remaining Land 4,807 Operating Office Portfolio 4.884 MSF 72.9% $38.54 2018/2019 Jersey City Starts 25 Christopher Columbus Drive: 25 Christopher Columbus, a near-term start is a 718-market unit mixed use development, including a school and significant retail space. Urby II: The follow-up to the neighborhood-defining joint venture between Mack-Cali and Ironstate, Urby II is scheduled to begin construction in 2019. Harborside 8: The Company plans to begin construction on Harborside 8 next year. The project – a 679-unit prime development with unparalleled views of downtown Manhattan, will be the pinnacle of the Roseland Jersey City portfolio. Harborside 8

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Jersey City: The New Scene 20 1st Most Livable City in the US Smartasset (2016) 1st Fastest- Growing Metro Area in NJ Forbes & CareerBliss 2nd Happiest City to Work in the US Forbes & CareerBliss 5th Best Public Transportation in the US Business Insider Top 5 US Cities for Millennials Niche & Forbes Top 5 Hippest Blocks in NYC Forbes & CareerBliss 10th US Cities Where Millennials Make Over $350,000 Zillow 10th Most Artistic City in the US Atlantic Magazine

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Regional Spotlight - Port Imperial 21 The Port Imperial submarket provides unrivaled access to Midtown West and Hudson Yards ($17Bn investment) via the NY Waterway Ferry. Port Imperial will further become a prime residential destination as companies migrate to Hudson Yards Operating In-Construction Land Current: 611 Units 1,045 Units/Keys 1,391 Units Y/E 2018: 983 Units/Keys 673 Units 1,391 Units

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Port Imperial Fundamentals 22 Port Imperial is a community sought after by young professionals looking for access to New York City and unrivaled value. The neighborhood offers numerous parks, walking paths, retail options and dining experiences, all within walking distance. The unparalleled absorption of new units indicate that the Port Imperial market is positioned for continued growth.

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Regional Spotlight - Overlook Ridge 23 Operating Properties Units % Leased (6/30/18) Rent PSF (6/30/18) Alterra at Overlook Ridge 722 97.5% $24.12 The Chase at Overlook Ridge 664 97.6% 26.77 Total 1,386 97.5% $25.39 2018 Target Start (Chase III) 326 Remaining Land 490 Roseland has developed the 92 acre Overlook Ridge community, located 5 miles from the center of Boston and directly off of Route 1 2018 Overlook Ridge Starts Chase III at Overlook Ridge: The phase three culmination of the Overlook Ridge Master Plan, Cantera at Overlook Ridge, a 326-unit residential development is projected to begin construction later this year. With direct access to Boston via Route 1, Cantera offers luxury apartments to anyone seeking the comforts of a suburban community with the city at their doorstep.

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Repositioning - Harborside Cultural District The Company continues to invest in our Jersey City assets as part of a complete transformation project to create a cultural district at Harborside. 24 Lutze Biergarten Harborside Tower (Proposed JV with SJP Properties) New Retail, Dining and Event Space Re-Skin of Harborside Complex Revitalized Pedestrian Walkways and New Ferry European-Style Food Hall

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NJ Grows: Mack-Cali is well positioned to benefit from business incentive program 25 Tenants locating in the Company’s core markets may be eligible to participate in the Grow NJ Assistance Program, a powerful job creation program designed to strengthen New Jersey’s competitive edge. Companies that create jobs in New Jersey are eligible for a potential gross benefit ranging from $6,000 to $9,750 per qualifying new employee, per year in tax incentives for up to ten years. At a 200 square feet per employee space metric, this incentive could provide approximately $30.00 PSF - $48.75 PSF in gross savings per year. The Grow NJ program is currently scheduled to “sunset” on June 30, 2019. Applications must be filed prior to that date.

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Appendix 26

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27 Average Revenue Per Home: Calculated as total apartment revenue for the quarter ended December 31, divided by the average percent occupied for the quarter ended December 31, 2017, divided by the number of apartments and divided by three. Operating Communities: Communities that have achieved Project Stabilization. Class A Suburban: Long-term hold office properties in targeted submarkets; formerly defined as Urban Core. Predevelopment Communities: Communities where the Company has commenced predevelopment activities that have a near-term projected project start. Consolidated Operating Communities: Wholly owned communities and communities whereby the Company has a controlling interest. Project Completion: As evidenced by a certificate of completion by a certified architect or issuance of a final or temporary certificate of occupancy. Flex Parks: Primarily office/flex properties, including any office buildings located within the respective park. Project Stabilization: Lease-Up communities that have achieved over 95 Percentage Leased for six consecutive weeks. Future Development: Represents land inventory currently owned or controlled by the Company. Projected Stabilized NOI: Pro forma NOI for Lease-Up, In-Construction or Future Development communities upon achieving Project Stabilization. Identified Repurposing Communities: Communities not currently owned by RRT, which have been identified for transfer from Mack-Cali to RRT for residential repurposing. Projected Stabilized Yield: Represents Projected Stabilized NOI divided by Total Costs. In-Construction Communities: Communities that are under construction and have not yet commenced initial leasing activities. Repurposing Communities: Commercial holdings of the Company which have been targeted for rezoning from their existing office to new multi-family use and have a likelihood of achieving desired rezoning and project approvals. Lease-Up Communities: Communities that have commenced initial operations but have not yet achieved Project Stabilization. Subordinated Joint Ventures: Joint Venture communities where the Company's ownership distributions are subordinate to payment of priority capital preferred returns. MCRC Capital: Represents cash equity that the Company has contributed or has a future obligation to contribute to a project. Suburban: Long-term hold office properties (excluding Class A Suburban and Waterfront locations); formerly defined as Suburban Core Net Asset Value (NAV): The metric represents the net projected value of the Company’s interest after accounting for all priority debt and equity payments. The metric includes capital invested by the Company. Third Party Capital: Capital invested by third parties and not Mack-Cali. Net Operating Income (NOI): Total property revenues less real estate taxes, utilities and operating expenses Total Costs: Represents full project budget, including land and developer fees, and interest expense through Project Completion. Non-Core: Properties designated for eventual sale/disposition or repositioning/redevelopment. Waterfront: Office assets located on NJ Hudson River waterfront. Global Definitions

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Development Activity and Cash Flow Growth 4Q 2017 Note: Roseland delivered Phase I (237 units) in 1Q 2018 and envision completion of Phase II (128 units) in 3Q 2018. Projected stabilized yield without the Marriott Hotels at Port Imperial is 6.30 percent. $ in millions (unaudited) 28

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Notes: Net Asset Value (Unaudited) 29 The year one cap rate, applied to the projected 2018 cash net operating income, is derived from the present value of periodic cash flows over five years and a terminal value based on stabilized income and a market cap rate, all discounted at an unlevered internal rate of return. The Company calculates estimated gross asset values for each of its operating office assets by taking the sum of (i) the present value of periodic cash flows over five years and (ii) a terminal value based on estimated stabilized income and a market capitalization rate at stabilization, all discounted at an unlevered internal rate of return. This value, divided by the projected net operating income for a one year period yields the year one imputed capitalization rate. Management projects the periodic cash flows over five years and the stabilized income from a combination of in-place lease contracts, prospective renewals of expiring leases and prospective lease-up of vacant space. Factors considered by management in projecting releasing and lease-up of vacant space and estimating the applicable market rental rates include: identification of leases currently being negotiated by management; historical annual leasing volumes for such property types; and comparable leases that have been executed for properties within the Company’s portfolio and for competitor buildings in similar locations. Reflects 2018 cash net operating income with management fees added back for office portfolio. NAV is generally arrived at by calculating the estimated gross asset values for each of the Company’s real estate properties, investments and other significant assets and interests, and then deducting from such amounts the corresponding net debt and third parties’ interests in the assets. Gross asset values for stabilized operating multi-family real estate properties are calculated using the direct capitalization method by dividing projected net operating income for the next one year period by an estimated market capitalization rate for each property. Gross asset values for operating office properties are presented by dividing projected net operating income for the next one year period by an estimated year one imputed capitalization rate for each property. See Footnote 4 for a more detailed description of the methodology used by management to estimate gross asset values for its operating office properties. Management projects net operating income that it expects to receive for future periods from a combination of in-place lease contracts, prospective renewals of expiring leases and prospective lease-up of vacant space. Market capitalization rates are estimated for each property based on its asset class and geographic location and are based on information from recent property sale transactions as well as from publicly available information regarding unrelated third party property transactions. The value range is determined by adding or subtracting 0.50% to the year 1 cap rate for office properties and 0.25% to the year 1 cap rate for residential properties. Property cash flows have been reduced by credit loss reserves and leasing and base building capital expenditures, including targeted Harborside renovations, estimated at approximately $75 million. Valuations for non-core assets, which are those assets being considered for sale or disposal, or in the active marketing process, are generally based on recent contract prices for similar properties in the process of being sold, letters of intent and ongoing negotiations for properties. Includes the Company's ownership interests in the Hyatt Regency Jersey City and three office joint venture properties. Wegman’s $36 million asset value calculated using $1.6 million NOI capped at 4.5%. 24 Hour Fitness $20 million asset value calculated using $1 million NOI capped at 5%. The value of land is based on a combination of recent or pending transactions for land parcels within our relevant markets and unrelated third parties, and sometimes may utilize land appraisals for certain markets, if available for other purposes, such as for transaction financing. Further, we consider what a land parcel’s value would need to be when combined with all other development costs to yield what we believe to be an appropriate target rate of return for a development project. The per apartment unit or per square foot office space values are derived by dividing the aggregate land value by the number of potential apartment units or square feet of office space the land can accommodate. The number of potential units or square feet of office space a land parcel can accommodate is most commonly governed by either in-place governmental approvals or density regulations set forth by existing zoning guidelines.

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30 Notes: Net Asset Value (Unaudited) Valuations for properties planned for or undergoing a repositioning or repurposing utilize a projected stabilized net operating income for the asset upon completion of the repositioning/repurposing activities. After applying an estimated capitalization rate to a projected stabilized net operating income, the capitalized value is next discounted back based on the projected number of periods to re-stabilize the asset. The discount rate applied is determined based on a risk assessment of the repositioning/repurposing activities and comparable target returns in the marketplace, and further validated by outside market sources, when available for that market. Additionally, adjustments are made to the estimated value by deducting any estimated future costs necessary to complete the planned activities, as well as adding back the discounted projected interim operating cash flows expected to be generated by the property until re-stabilization has been achieved. Represents an estimate of management fee cost based on 3.0% of revenues, as the NOI presented is before cost for managing the portfolio. Residential NOI calculations already account for management fee. Joint venture investments are generally valued by: applying a capitalization rate to projected net operating income for the joint venture’s asset (which is similar to the process for valuing those assets wholly owned by the Company, as described above and previously), and deducting any joint venture level debt and any value allocable to joint venture partners’ interests. The valuation approach for assets in-construction or lease-up are similar to that applied to assets undergoing repositioning/repurposing, as described above. After applying an estimated capitalization rate, currently ranging from 4.5% to 5.25%, to a projected stabilized net operating income, estimated to total approximately $55.9 million upon completion of the construction or lease-up activities, the Company deducts any estimated future costs totaling $307.6 million required to complete construction of the asset to arrive at an estimated value attributable to the asset. The Company then discounts the capitalized value back based on the projected number of periods to reach stabilization. The discount rate applied, currently ranging from 7% to 9.75%, is determined based on a risk assessment of the development activities and comparable target returns in the marketplace. The Company then adds back the discounted projected interim cash flows expected to be generated during the projected lease-up period to reach stabilization. Represents discounted NOI for assets not yet stabilized and required capital to complete assets. The residential valuation analysis totals to a Roseland NAV of $1,787,000,000, with the company’s share of this NAV of $1,555,000,000 (“MCRC Share”). This latter amount represents the company's share of Roseland NAV, net of the $232,000,000 attributable to Rockpoint's noncontrolling interest. The increase in the approximate NAV per share of $0.11 from March 31, 2018 to June 30, 2018 is due primarily to the decrease in office unsecured debt of $8 million and the start of construction at Building 8/9 at Port Imperial. Overall, NAV is arrived at by calculating the estimated gross asset values for each of their real estate properties, investments and other significant assets and interests, and then deducting from such amounts the corresponding net debt and third parties’ interests in the assets. Gross asset values for the operating real estate properties are calculated using the direct capitalization method by dividing projected net operating income for a one year period by an estimated current capitalization rate for each property. For each operating property, management projects net operating income that it expects to receive for future periods from a combination of in-place lease contracts, prospective renewals of expiring leases and prospective lease-up of vacant space. Factors considered by management in projecting releasing and lease-up of vacant space and estimating the applicable market rental rates include: identification of leases currently being negotiated by management; historical annual leasing volumes for such property types; and comparable leases that have been executed for properties within the Registrants’ portfolio and for competitor buildings in similar locations. A capitalization rate is estimated for each property based on its asset class and geographic location. Estimates of capitalization rates are based on information from recent property sale transactions as well as from publicly available information regarding unrelated third party property transactions. The use of NAV as a measure of value is subject to certain inherent limitations. The assessment of the estimated NAV of a particular property is subjective in that it involves estimates and assumptions and can be calculated using various acceptable methods. The Company’s methods of determining NAV may differ from the methods used by other companies. Accordingly, the Company’s estimated NAV may not be comparable to measures used by other companies. As with any valuation methodology, the methodologies utilized by the Company in estimating NAV are based upon a number of estimates, assumptions, judgments or opinions that may or may not prove to be correct. Capitalization rates obtained from publicly available sources also are critical to the NAV calculation and are subject to the sources selected and variability of market conditions at the time. Investors in the Company are cautioned that NAV does not represent (i) the amount at which the Company’s securities would trade at a national securities exchange, (ii) the amount that a security holder would obtain if he or she tried to sell his or her securities, (iii) the amount that a security holder would receive if the Company liquidated its assets and distributed the proceeds after paying all of their expenses and liabilities or (iv) the book value of the Company’s real estate, which is generally based on the amortized cost of the property, subject to certain adjustments. Information About Net Asset Value (NAV)

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