Mack-Cali to Develop Two Additional Office Towers at Harborside Financial Center on the Hudson River Waterfront in Jersey City
10/23/2000 Category: Leasing and Development
Buildings to Total 1.5 Million Square Feet
--Pre-Leasing Includes 300,000 Square-Foot Lease with Charles Schwab & Co.--
CRANFORD, NEW JERSEY—October 23, 2000—Mack-Cali Realty Corporation (NYSE:CLI) announced today that it intends to develop two class A office towers at its Harborside Financial Center office complex on the Hudson River waterfront in Jersey City, New Jersey, directly across from downtown Manhattan.
The two projects consist of a 33-story, 915,000 square-foot building with a seven-story, 1,270-car parking garage pedestal, to be known as Harborside Plaza 5, and a 19-story, 575,000 square-foot building to be known as Harborside Plaza 10.
Charles Schwab & Co., a leading financial services company, has signed a 15-year lease for 300,000 square feet at Plaza 10, which is expected to be completed in early 2002.
Plaza 5, which is expected to be completed in third quarter 2002, has tenant commitments of approximately 25% of the available space. The Company plans to hold a groundbreaking ceremony for Plaza 5 and a property tour at Harborside on October 24.
Total development costs for the projects are estimated to be approximately $400 million. The projects, which will be initially funded from Mack-Cali's revolving credit lines, are expected to provide unleveraged returns of approximately 11%.
Mitchell E. Hersh, chief executive officer of Mack-Cali, commented, "These projects represent a significant step toward realizing our vision of Harborside Financial Center as truly a ‘city within a city'—a comprehensive, class A, mixed-use, urban campus serving some of the country's top businesses." He continued, "With the Jersey City waterfront's class A vacancy rate approaching zero, this is an opportune time to begin construction on these exciting projects."
Harborside Financial Center currently consists of 2.1 million square feet of class A office space in four plazas, all of which are 100% leased. The completion of Plazas 5 and 10 will bring the size of the complex to approximately 3.6 million square feet. In addition to the buildable land for Plazas 5 and 10, the remaining sites at Harborside are able to accommodate approximately 4.5 million square feet of additional office development.
At Harborside, Mack-Cali recently completed a 185,000 square-foot class A office building for TD Waterhouse, known as Harborside Plaza 4A, which was built on top of an 1100-car parking garage. Additionally, Mack-Cali is developing, through a joint venture with Hyatt Hotels Corporation, a 350-room Hyatt Regency Hotel on Harborside's south pier, and plans to develop, through a joint venture with Lincoln Property Company, 300 luxury residential apartments on Harborside's north pier.
Both Plazas 5 and 10 will feature state-of-the-art infrastructures, including redundant utilities, security systems, fiber optic broadband services with high-speed Internet access, and access to multiple telecommunications providers, as well as abundant on-site amenities and dramatic views of New York City and New York Harbor. The buildings also offer excellent transportation access, since Harborside Financial Center is adjacent to the Exchange Place PATH station and is the site of both a New York Waterway ferry stop and a stop on the new Bergen-Hudson Light Rail System.
Plaza 5, designed by GRAD Associates, will offer three base floors with 85,000 square-foot floorplates and floor-to-floor heights of 17 1/2 feet and 22 tower floors, including two mechanical floors, with 34,000 square-foot floorplates and floor-to-floor heights of 13 1/2 feet. Plaza 5 will be constructed adjacent to existing Harborside Plazas 1, 2 and 3, along a pedestrian boulevard and the light rail transit station. Ten thousand square feet of street-level retail space will also be included in Plaza 5.
Plaza 10, designed by HLW International, will be built at Harborside on land owned by a joint venture between Mack-Cali and Columbia Development. The building, which will be situated directly on the waterfront, will offer 16 office floors in addition to ground, mezzanine and roof floors. Typical office floors feature 35,000 square-foot floorplates and 13 1/2-foot floor-to-floor heights, although four of the floors leased by Charles Schwab & Co. will have 17 1/2-foot floor-to-floor heights to accommodate its trading operations. Plaza 10 will be the site of Schwab's new expanded East Coast regional headquarters.
The exclusive leasing agent for Plazas 5 and 10, as well as the remaining towers planned for development at Harborside, is Insignia/ESG. Jeffrey M. Brown Associates, Inc. has been selected as the construction manager for both projects. Julien J. Studley and Scopa, Inc. represented Charles Schwab & Co. in lease negotiations.
The 11.7 million square-foot Jersey City waterfront is among the strongest submarkets in the country. According to Insignia/ESG, the submarket has a 0.2% class A vacancy rate and has absorbed 4.5 million square feet of class A space since the start of 1999, most of which was space in newly-constructed buildings.
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 for its class A real estate portfolio. Mack-Cali owns or has interests in 266 properties, primarily office and office/flex buildings, totaling approximately 28.2 million square feet, located in 12 states and the District of Columbia. The properties, which are primarily located in the Northeast, enable the Company to provide a full complement of real estate opportunities to its diverse base of over 2,400 tenants.
Additional information on Mack-Cali Realty Corporation is available on the Company's website at www.mack-cali.com.
Certain information discussed in this press release may constitute forward-looking statements within the meaning of the Federal Securities law. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. Forward-looking information is subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those projected. Among those risks, trends and uncertainties are the general economic climate; the supply of and demand for office, office/flex and industrial/warehouse properties; interest rate levels; the availability of financing; 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 will not take occupancy or pay rent, or that development or operating costs may be greater than anticipated. For further information on factors which could impact the Company and the statements contained herein, reference should be made to the Company's filings with the Securities and Exchange Commission including quarterly reports on Form 10-Q, reports on Form 8-K, and annual reports on Form 10-K.