Our management has consistently adhered to conservative principles of strong coverage ratios, low leverage, and a high level of unencumbered assets. In 2003, in light of the favorable interest rate environment, we secured financing and lengthened our debt maturity profile in transactions totaling $295 million. Our balance sheet remains one of the strongest and most flexible in the industry, with ample capacity to consider and pursue significant opportunities as they arise, as well as to mitigate against risk.
         Our diverse, credit-quality tenant base provides a stable, high-quality earnings stream for our Company. In 2003, our revenues rose from $563.6 million to $586.2 million and our net income available to common shareholders increased from $139.7 million to $141.4 million. Our dividend remained solid, despite the weak economy. At $2.52 per share on an annualized basis, our dividend closed the year with a 6.05 percent yield, comparing very favorably to the S&P 500 average yield of 1.82 percent.

Delivering Value
As an investment, real estate investment trusts (REITs) had a positive year in 2003. Investors continued to look to high-quality REITs, such as Mack-Cali, for their predictable income streams and strong dividends.

  REITs are becoming increasingly accepted as a sector that should be represented in a diversified portfolio's stock allocation, and Mack-Cali is becoming a favorable beneficiary of that trend.
         Mack-Cali produced an outstanding total return to shareholders of 48 percent in 2003. Since we became a public company in 1994, Mack-Cali has outperformed both the National Association of Real Estate Investment Trusts (NAREIT) equity index and the S&P 500. Over those nine years, Mack-Cali produced an impressive total return of 382.5 percent to our shareholders.
         With our accomplishments in 2003 and our unwavering focus as our foundation, Mack-Cali enters 2004 in an excellent position. We have a proven strategy, exceptional office properties, a diverse and high-quality tenant base, strong occupancies and sound financial underpinnings. Poised to capitalize on a recovering economy, we are very confident in our Company's continued success. We appreciate your interest and support of Mack-Cali, and look forward to sharing the benefits of our continued progress with you.

Sincerely,

Mitchell E. Hersh
Chief Executive Officer