PAGE(S)
I.  COMPANY BACKGROUND
·      About the Company / Other Corporate Data	5
·      Board of Directors / Executive Officers	6
·      Equity Research Coverage / Company Contact Information	7
II.  FINANCIAL HIGHLIGHTS
·      Quarterly Summary / Recent Transactions	9
·      Leasing	9 - 10
·      Information About FFO	10
·      Key Financial Data	11
·      Same-Store Results and Analysis	12
·      Select Financial Ratios	13
·      Debt Analysis:
(a) Debt Breakdown/Future Repayments	14
(b) Debt Maturities	15
(c) Debt Detail	16
III.  FINANCIAL INFORMATION
·      Consolidated Statements of Operations	18
·      Consolidated Balance Sheets	19
·      Consolidated Statement of Changes in Equity	20
·      Statements of Funds from Operations	21
·      Statements of Funds from Operations Per Diluted Share	22
·      Reconciliation of Basic-to-Diluted Shares/Units	23
·      Unconsolidated Joint Venture Information	24 - 26
IV.  PORTFOLIO SUMMARY
·      Operating Property Acquisitions	28
·      Properties Commencing Initial Operations	29
·      Rental Property Sales/Dispositions	30
·      Breakdown of Company Holdings	31
·      Consolidated Property Listing (by Property Type)	32 - 39
·      Unconsolidated Joint Venture Summary	40 - 42
·      Consolidated Portfolio Analyses:
Breakdown by:
(a) Number of Properties	43
(b) Square Footage	44
(c) Base Rental Revenue	45
(d) Percentage Leased	46
V.  MULTI-FAMILY RENTAL PORTFOLIO
·      Summary of Stabilized Operating Communities/Capitalization	48
·      Stabilizing Operating Communities-Repositioning	49
·      Summary of Communities in Lease-Up	50
·      Summary of Development Communities	51
·      Summary of Land Holdings/Pre-Development	52
VI.  OFFICE PORTFOLIO
·      Summary of Development Projects	54
·      Summary of Land Holdings	55
·      Leasing Statistics	56 -61
·      Market Diversification (MSAs)	62
·      Industry Diversification (Top 30 Tenant Industries)	63
·      Significant Tenants (Top 50 Tenants)	64 - 65
·      Schedules of Lease Expirations (by Property Type)	66 - 70

·	risks and uncertainties affecting the general economic climate and conditions, which in turn may have a negative effect on the fundamentals of the Company’s business and the financial condition of the Company’s tenants and residents;
·	the value of the Company’s real estate assets, which may limit the Company’s ability to dispose of assets at attractive prices or obtain or maintain debt financing secured by the Company’s properties or on an unsecured basis;
·	the extent of any tenant bankruptcies or of any early lease terminations;
·	the Company’s ability to lease or re-lease space at current or anticipated rents;
·	changes in the supply of and demand for our properties;
·	changes in interest rate levels and volatility in the securities markets;
·	changes in operating costs;
·	the Company’s ability to obtain adequate insurance, including coverage for terrorist acts;
·	the availability of financing on attractive terms or at all, which may adversely impact the Company’s ability to pursue acquisition and development opportunities and refinance existing debt and the Company’s future interest expense;
·	changes in governmental regulation, tax rates and similar matters; and
·	other risks associated with the development and acquisition of properties, including risks that the development may not be completed on schedule, that the tenants or residents will not take occupancy or pay rent, or that development or operating costs may be greater than anticipated.

Corporate Headquarters	Edison, New Jersey
Fiscal Year-End	12/31
Total Properties	282
Total Commercial Square Feet / Multi-family Units	31.5 million commercial square feet and 4,940 multi-family apartment homes
Geographic Diversity	Seven states and the District of Columbia
New Jersey Presence	21.6 million square feet of commercial space and 2,548 multi-family apartment homes
Northeast Presence	31.5 million square feet of commercial space and 4,940 multi-family apartment homes
Common Shares and
Units Outstanding	100.1 million
Dividend-- Quarter/Annualized	$0.15/$0.60
Dividend Yield	3.1%
Total Market Capitalization	$4.2 billion
Senior Debt Rating	BBB- (S&P and Fitch);
	Baa2 (Moody’s)

William L. Mack, Chairman of the Board
Alan S. Bernikow	David S. Mack
Kenneth M. Duberstein	Alan G. Philibosian
Nathan Gantcher	Irvin D. Reid
Mitchell E. Hersh	Vincent Tese
Jonathan Litt	Roy J. Zuckerberg

 

 

Bank of America Merrill Lynch James C. Feldman (646) 855-5808	ISI Group Steve Sakwa (212) 446-9462
Barclays Capital Ross Smotrich (212) 526-2306	J.P. Morgan Anthony Paolone (212) 622-6682
Citigroup Michael Bilerman (212) 816-1383	KeyBanc Capital Markets Jordan Sadler (917) 368-2280
Cowen and Company James Sullivan (646) 562-1380	Stifel, Nicolaus & Company, Inc. John W. Guinee, III (443) 224-1307
Deutsche Bank North America Vin Chao (212) 250-6799	UBS Investment Research Ross T. Nussbaum (212) 713-2484
Green Street Advisors Michael Knott (949) 640-8780

Mack-Cali Realty Corporation
Investor Relations Department
343 Thornall Street
Edison, New Jersey 08837-2206
Phone:    (732) 590-1000	Web:     www.mack-cali.com
Fax:         (732) 205-8237	E-mail:  investorrelations@mack-cali.com

Funds from operations (FFO) for the quarter ended September 30, 2014 amounted to $48.0 million, or $0.48 per share. For the nine months ended September 30, 2014, FFO equaled $128.5 million, or $1.29 per share.

Net income available to common shareholders for the third quarter 2014 equaled $2.0 million, or $0.02 per share. For the nine months ended September 30, 2014, net income to common shareholders amounted to $37.8 million, or $0.43 per share.

All per share amounts presented above are on a diluted basis.

Total revenues for the third quarter 2014 were $155.5 million. For the nine months ended September 30, 2014 total revenues amounted to $485.4 million.

The Company had 89,055,220 shares of common stock, and 11,092,044 common operating partnership units outstanding as of September 30, 2014. The Company had a total of 100,147,264 common shares/common units outstanding at September 30, 2014.

As of September 30, 2014, the Company had total indebtedness of approximately $2.2 billion, with a weighted average annual interest rate of 5.62 percent.

The Company had a debt-to-undepreciated assets ratio of 39.0 percent at September 30, 2014. The Company had an interest coverage ratio of 2.8 times for the quarter ended September 30, 2014.

In the quarter, the Company completed the sale of the remaining seven office properties located in northern New Jersey, Westchester County, New York, and Stamford, Connecticut, aggregating 916,000 square feet, under its agreement with Keystone Property Group for approximately $104 million, comprised of: $77.9 million in cash; Company subordinated equity interests in each of the properties sold with capital accounts aggregating $18.8 million; and Company pari-passu equity interests in five of the properties sold aggregating $7.3 million. The purchasers of these properties are unconsolidated joint ventures formed between the Company and affiliates of the Keystone Property Group.

In August 2014, the Company acquired the equity interests of its joint venture partner in Overlook Ridge, L.L.C, Overlook Ridge JV, L.L.C. and Overlook Ridge JV 2C/3B, L.L.C. for $16.6 million. As a result, the Company increased its ownership to 100 percent of the developable land owned by those entities and acquired an additional 25 percent, for a total of 50 percent of its subordinated, unconsolidated interests in two operating multi-family properties owned by those entities.

Mack-Cali’s consolidated commercial in-service portfolio was 83.7 percent leased at September 30, 2014, unchanged from June 30, 2014.
For the quarter ended September 30, 2014, the Company executed 116 leases at its consolidated in-service portfolio totaling 621,077 square feet, consisting of 332,509 square feet of office space, 282,678 square feet of office/flex space and 5,890 square feet of industrial space. Of these totals, 265,636 square feet were for new leases and 355,441 square feet were for lease renewals and other tenant retention transactions.
Highlights of the quarter’s leasing transactions include:
NORTHERN NEW JERSEY:
-	First Data Corporation, a global payment processing company, signed a new lease for 24,179 square feet at 101 Hudson Street in Jersey City.  The 1,246,283 square-foot office building is 86.1 percent leased.

-	Also at 101 Hudson Street in Jersey City, law firm Eltman, Eltman & Cooper, P.C. signed a new lease for 16,902 square feet.
-	Accounting firm KPMG LLP signed an expansion for 17,085 square feet at 300 Tice Boulevard in Woodcliff Lake.  The 230,000 square-foot office building is 100 percent leased.
CENTRAL NEW JERSEY:
-	Jacobs Engineering Group Inc., providers of technical professional and construction services, signed a new lease for 12,727 square feet at 100 Walnut Avenue in Clark.  The 182,555 square-foot office building is 90.1 percent leased.
WESTCHESTER COUNTY, NEW YORK:
-	Quintiles, Inc., a provider of biopharmaceutical development and commercial outsourcing services, signed a renewal for 18,620 square feet at 8 Skyline Drive in Hawthorne.  Located in Mid-Westchester Executive Park, the 50,000 square-foot office/flex building is 85.4 percent leased.
-	Internet grocer Peapod, LLC signed a new lease for 18,000 square feet at 175 Clearbrook Road in Elmsford.  Located in Cross Westchester Executive Park, the 98,900 square-foot office/flex building is 96.7 percent leased.
-	Also at 175 Clearbrook Road, Matthews International Corporation, a designer, manufacturer and marketer of memorialization products and brand solutions, signed a new lease for 13,000 square feet.
-	Wright Brothers Services, Inc., specializing in freight transportation, signed transactions totaling 12,120 square feet consisting of a 5,255 square-foot renewal at 150 Clearbrook Road and a 6,865 square-foot renewal at 200 Clearbrook Road in Elmsford.  Located in Cross Westchester Executive Park, 150 Clearbrook Road is a 74,900 square-foot office/flex building that is 99.3 percent leased and 200 Clearbrook Road is a 94,000 square-foot office/flex building that is 98.8 percent leased.
SOUTHERN NEW JERSEY:
-	EVO Merchant Services, LLC, a payments service provider, signed a renewal of 19,200 square feet at 102 Commerce Drive in Moorestown. Located in Moorestown West Corporate Center, the 38,400 square-foot office/flex building is 100 percent leased.
-	Tricomm Services Corporation, an IT technology service provider, is relocating within the building to 12,000 square feet at 1247 North Church Street in Moorestown.  The transaction represents an expansion of 7,200 square feet and extension of 4,800 square feet. Also located in Moorestown West Corporate Center, the 52,790 square-foot office/flex building is 86.7 percent leased.

	09/30/14		06/30/14		03/31/14		12/31/13		09/30/13
Shares and Units:
Common Shares Outstanding	89,055,220		88,982,062		88,630,146		88,247,591		88,021,807
Common Units Outstanding	11,092,044		11,164,018		11,518,069		11,864,775		11,987,175
Combined Shares and Units	100,147,264		100,146,080		100,148,215		100,112,366		100,008,982
Weighted Average- Basic (a)	100,052,290		100,022,734		99,875,659		99,806,029		99,787,129
Weighted Average- Diluted (b)	100,052,290		100,022,734		99,875,659		99,806,029		99,787,129
Common Share Price ($’s):
At the end of the period	19.11		21.48		20.79		21.48		21.94
High during period	22.05		22.44		23.23		22.49		25.13
Low during period	18.95		19.98		19.75		19.05		20.60
Market Capitalization:
($’s in thousands, except ratios)
Market Value of Equity (c)	1,977,334		2,205,844		2,137,042		2,205,697		2,250,247
Total Debt	2,238,641		2,208,268		2,232,287		2,362,766		2,368,681
Total Market Capitalization	4,215,975		4,414,112		4,369,329		4,568,463		4,618,928
Total Debt/ Total Market
Capitalization	53.10	%	50.03	%	51.09	%	51.72	%	51.28	%
Financials:
($’s in thousands, except ratios and
per share amounts)
Total Assets	4,357,197		4,354,772		4,354,343		4,515,328		4,609,263
Gross Book Value of Real Estate Assets	4,909,727		4,966,633		5,172,017		5,129,933		5,113,940
Total Liabilities	2,452,914		2,438,892		2,483,223		2,596,873		2,598,601
Total Equity	1,904,283		1,915,880		1,871,120		1,918,455		2,010,662
Total Revenues	155,489		160,300		169,596		165,267		162,505
Capitalized Interest	4,158		3,351		3,141		2,623		3,514
Scheduled Principal Amortization	690		595		904		939		1,017
Interest Coverage Ratio	2.76		2.79		2.01		2.65		2.85
Fixed Charge Coverage Ratio	2.34		2.44		1.77		2.38		2.48
Net Income (Loss)	2,085		57,347		(17,628)		(61,770)		3,439
Net Income (Loss) Available to Common Shareholders	1,982		51,123		(15,298)		(54,179)		4,643
Earnings per Share—diluted	0.02		0.58		(0.17)		(0.62)		0.05
FFO per Share—diluted (d)	0.48		0.50		0.30		0.52		0.57
Dividends Declared per Share	0.15		0.15		0.30		0.30		0.30
FFO Payout Ratio—diluted (d)	31.24	%	29.80	%	99.40	%	57.46	%	52.42	%
Portfolio Size:
Properties	282		279		279		279		275
Total Commercial Square Footage	31,459,489		31,459,489		31,002,668		31,002,668		30,657,119
Commercial Sq. Ft. Leased at End of Period (e) (f) (g)	83.7	%	83.7	%	83.6	%	86.1	%	86.1	%
Apartment Homes	4,940		3,898		3,678		3,678		3,319

(a)	Calculated based on weighted average common shares outstanding, assuming redemption of operating partnership common units into common shares.

(b)	Calculated based on shares and units included in basic per share/unit computation, plus dilutive Common Stock Equivalents (i.e. convertible preferred units, options and warrants).

(c)	Includes any outstanding preferred units presented on a converted basis into common units and noncontrolling interests in consolidated joint ventures.

(d)	Funds from Operations (“FFO”) is calculated in accordance with the definition of the National Association of Real Estate Investment Trusts (NAREIT). See “Information About FFO” on page 10.

(e)	Percentage leased includes leases in effect as of the period end date, some of which have commencement dates in the future and leases that expire at the period end date.

(f)	Reflects square feet leased at the Company’s consolidated in-service portfolio, excluding in-service properties in lease up (if any).

(g)	The percent leased at March 31, 2014 includes the effects of the lease expirations that had been anticipated of Morgan Stanley & Co. and Credit Suisse (USA) at Harborside in Jersey City aggregating 371,000 square feet.

		For the three months ended
		September 30,					%
		2014		2013		Change	Change
Total Property Revenues	$	141,209	$	140,476	$	733	0.5
Real Estate Taxes		21,253		18,407		2,846	15.5
Utilities		15,086		15,549		(463)	(3.0)
Operating Services		25,155		24,062		1,093	4.5
Total Property Expenses:		61,494		58,018		3,476	6.0
GAAP Net Operating Income		79,715		82,458		(2,743)	(3.3)
Less: straight-lining of rents adj.		1,022		432		590	136.6
Net Operating Income	$	78,693	$	82,026	$	(3,333)	(4.1)
Percentage Leased at
Period End		83.7	%	86.2	%
Total Properties:		227
Total Square Footage:		25,340,920
Apartment Homes:		722

		For the nine months ended
		September 30,					%
		2014		2013		Change	Change
Total Property Revenues	$	409,166	$	412,824	$	(3,658)	(0.9)
Real Estate Taxes		62,295		55,464		6,831	12.3
Utilities		51,152		40,737		10,415	25.6
Operating Services		74,133		68,979		5,154	7.5
Total Property Expenses:		187,580		165,180		22,400	13.6
GAAP Net Operating Income		221,586		247,644		(26,058)	(10.5)
Less: straight-lining of rents adj.		2,932		7,648		(4,716)	(61.7)
Net Operating Income	$	218,654	$	239,996	$	(21,342)	(8.9)
Percentage Leased at
Period End		83.6	%	86.1	%
Total Properties:		224
Total Square Footage:		25,137,414
Apartment Homes:		0

Ratios Computed For Industry	September 30,
Comparisons:	2014		2013
Financial Position Ratios:
Total Debt/ Total Book	51.38	%	51.39	%
Capitalization
(Book value) (%)
Total Debt/ Total Market	53.21	%	51.28	%
Capitalization
(Market value) (%)
Total Debt/ Total Undepreciated	39.02	%	39.47	%
Assets (%)
Secured Debt/ Total Undepreciated	14.31	%	12.54	%
Assets (%)
	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2014		2013			2014		2013
Operational Ratios:
Interest Coverage	2.76		2.85			2.50		3.01
(Funds from Operations+Interest
Expense)/Interest Expense (x)
Debt Service Coverage	2.69		2.76			2.44		2.92
(Funds from Operations +
Interest Expense)/(Interest Expense
+ Principal Amort.) (x)
Fixed Charge Coverage	2.34		2.48			2.17		2.63
(Funds from Operations +
Interest Expense + Ground Lease Payments)/
(Interest Expense + Capitalized Interest + Pref. Div.
+Prin. Amort.+Ground Lease
Payments)(x)
FFO Payout	31.24	%	52.42	%		46.69	%	56.53	%
(Dividends Declared/Funds from
Operations) (%)

 

 

 

			%		Weighted Average		Weighted Average
		Balance	of Total		Interest Rate (a)		Maturity in Years
Fixed Rate Unsecured Debt and
Other Obligations	$	1,417,439	63.32%		4.92%		4.87
Fixed Rate Secured Debt		625,776	27.95%		7.73%		2.77
Variable Rate Secured Debt		195,426	8.73%		3.86%		1.59
Totals/Weighted Average:	$	2,238,641	100.00%		5.62%	(b)	4.00

(a)	The actual weighted average LIBOR rate for the Company’s outstanding variable rate debt was 0.17 percent as of September 30, 2014, plus the applicable spread.

(b)	Excludes amortized deferred financing costs pertaining to the Company’s unsecured revolving credit facility which amounted to $0.7 million and $2.0 million for the three and nine months ended September 30, 2014, respectively.

 

 

							Weighted Average
		Scheduled		Principal			Interest Rate of
Period		Amortization		Maturities		Total	Future Repayments (a)
October 1 – December 31, 2014	$	2,305	$	133,484	$	135,789	8.67%
2015		8,539		220,646		229,185	4.54%
2016		8,311		333,272		341,583	6.97%
2017		7,275		391,369		398,644	4.11%
2018		7,311		231,537		238,848	6.67%
Thereafter		658		906,566		907,224	5.32%
Sub-total		34,399		2,216,874		2,251,273
Adjustment for unamortized debt discount/premium and mark-to-market, net, as of September 30, 2014		(12,632)		-		(12,632)
Totals/Weighted Average:	$	21,767	$	2,216,874	$	2,238,641	5.62%	(b)

(a)	The actual weighted average LIBOR rate for the Company’s outstanding variable rate debt was 0.17 percent as of September 30, 2014, plus the applicable spread.

(b)	Excludes amortized deferred financing costs pertaining to the Company’s unsecured revolving credit facility which amounted to $0.7 million and $2.0 million for the three and nine months ended September 30, 2014, respectively.

 

 

 

		October 1-
		December 31,														2022 and
		2014		2015		2016		2017		2018		2019	2020	2021		Beyond		Totals
Secured Debt:
Port Imperial South 4/5	$	36,950															$	36,950
6 Becker, 85 Livingston,75 Livingston, & 20 Waterview		65,035																65,035
4 Sylvan Way		14,575																14,575
10 Independence		16,924																16,924
Port Imperial South			$	43,910														43,910
9200 Edmonston Road				3,888														3,888
Overlook-Site II B				5,748														5,748
Overlook-Sites III D, III C, III A				17,100														17,100
Curtis Center					$	64,000												64,000
4 Becker						40,431												40,431
5 Becker						14,574												14,574
210 Clay						14,267												14,267
Prudential Portfolio							$	141,151										141,151
150 Main Street								218										218
23 Main Street									$	26,567								26,567
Harborside Plaza 5										204,970								204,970
100 Walnut Avenue											$	17,280						17,280
One River Center												39,586						39,586
Park Square												24,700						24,700
Total Secured Debt:	$	133,484	$	70,646	$	133,272	$	141,369	$	231,537	$	81,566	-	-		-	$	791,874
Unsecured Debt:
Unsecured credit facility
5.125% unsecured notes
due 1/15			$	150,000													$	150,000
5.80% unsecured notes
due 1/16					$	200,000												200,000
2.50% unsecured notes
due 12/17							$	250,000										250,000
7.75% unsecured notes
due 8/19											$	250,000						250,000
4.50% unsecured notes
due 4/22															$	300,000		300,000
3.15% unsecured notes
due 5/23																275,000		275,000
Total Unsecured Debt:	$	-	$	150,000	$	200,000	$	250,000		-	$	250,000	-	-	$	575,000	$	1,425,000
Total Debt:	$	133,484	$	220,646	$	333,272	$	391,369	$	231,537	$	331,566	-	-	$	575,000	$	2,216,874

 

 

		Effective
		Interest			September 30,		December 31,	Date of
Property Name	Lender	Rate			2014		2013	Maturity
Senior Unsecured Notes: (a)
5.125%, Senior Unsecured Notes	public debt	5.11%			-	$	200,030	02/15/14	(b)
5.125%, Senior Unsecured Notes	public debt	5.30%		$	149,971		149,902	01/15/15
5.800%, Senior Unsecured Notes	public debt	5.81%			200,104		200,161	01/15/16
2.500%, Senior Unsecured Notes	public debt	2.80%			249,077		248,855	12/15/17
7.750%, Senior Unsecured Notes	public debt	8.02%			248,959		248,799	08/15/19
4.500%, Senior Unsecured Notes	public debt	4.61%			299,550		299,505	04/18/22
3.150%, Senior Unsecured Notes	public debt	3.52%			269,778		269,323	05/15/23
Total Senior Unsecured Notes:				$	1,417,439	$	1,616,575