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Real estate industry

Mack-Cali Realty Corporation Enters Joint Venture Agreement for $92 Million Red Bank Office Building Project

Strategic Insights

— 2 min read

Mack-Cali Realty Corporation (NYSE: CLI) has entered a joint venture agreement with The PRC Group to develop a 92,878 square-foot class A office building in Red Bank, New Jersey. The project is part of a two-building complex, Red Bank Corporate Plaza, and has been entirely pre-leased to Hovnanian Enterprises, Inc. (NYSE: HOV) on a triple net basis for 10 years. The building is expected to be completed by the third quarter of 2007.

Key Takeaways:

  • Mack-Cali Realty Corporation has entered a joint venture agreement with The PRC Group to develop a 92,878 square-foot class A office building in Red Bank, New Jersey.
  • The entire building has been pre-leased to Hovnanian Enterprises, Inc. (NYSE: HOV) on a triple net basis for 10 years.
  • The building will be part of a two-building complex, known as Red Bank Corporate Plaza, which will include a four-story parking garage.
  • The second building in the complex, a two-story, 18,560 square-foot class A office building, will be developed at a later date.
  • The property will be developed on a 3.4-acre land site located at 141 West Front Street in downtown Red Bank.
  • Mack-Cali will serve as the leasing agent and co-management agent for the complex.
  • No broker was involved in the Hovnanian transaction.
  • Mitchell E. Hersh, president and chief executive officer of Mack-Cali, stated that the project demonstrates Mack-Cali's commitment to strategic, controlled development in the Red Bank submarket.
  • Joel S. Brudner, executive vice president and chief financial officer of The PRC Group, commented that the project will be one of the few class A office properties in downtown Red Bank offering suburban-type parking ratios.
  • Hovnanian Enterprises, Inc. is a leading residential developer and a publicly-traded real estate investment trust.
  • The PRC Group is a multi-faceted real estate owner, developer and services provider of residential and commercial properties.
  • Mack-Cali Realty Corporation is a fully-integrated, self-administered, self-managed real estate investment trust (REIT) providing management, leasing, development, construction and other tenant-related services.

Statistics:

  • 92,878 square feet: the size of the class A office building being developed.
  • 10 years: the length of the triple net lease with Hovnanian Enterprises, Inc.
  • 3.4 acres: the size of the land site located at 141 West Front Street in downtown Red Bank.
  • 30.9 million square feet: the total square footage of Mack-Cali's office and office/flex properties.
  • 2,300: the number of tenants in Mack-Cali's diverse tenant base.
  • 2007 (Q3): the expected completion date of the project.

Sources:

  • Mack-Cali Realty Corporation press release.
  • The PRC Group.
  • Hovnanian Enterprises, Inc.
  • Securities and Exchange Commission.

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