A joint venture led by Keystone Property Group has closed on the acquisition of three New Jersey office properties for approximately USD71.6 million from Mack-Cali Realty Corporation.
Earlier this year, Keystone and Mack-Cali entered into agreements to form various joint ventures to acquire the properties as part of a larger portfolio of office properties that Mack-Cali owns throughout Northern New Jersey, New York, and Connecticut.
Reflecting the ownership's strategy for the portfolio, Keystone will reinvest in the properties through redevelopment, management and upgrades to each site. Keystone anticipates closing on the remaining properties within the Tri-State portfolio over the next several weeks. Through its partnership with Keystone, Mack-Cali will participate in value creation above certain hurdle rates, handle leasing of the portfolio, as well as share in management fees.
"As part of our continued focus on creating lifestyle-oriented, world-class work environments that support tenants in maintaining their competitive edge, we are looking forward to executing on our strategy to unlock value at these properties through capital improvements," says Bill Glazer, president of Keystone Property Group. "The buildings within this portfolio are well located and are prime candidates for reinvestment. Through our partnership with Mack-Cali, we are strongly positioned to differentiate these properties in the market as stand-out business addresses that appeal to the needs of modern companies."
Mitchell E Hersh, president and chief executive officer of Mack-Cali, says: "This deal is squarely in line with our corporate strategy, whereby we will leverage this transaction to redeploy capital into our growing multi-family platform. At the same time, the deal structure allows us to participate in the upside created through reinvestment in these buildings."
The three New Jersey office properties acquired in this initial closing of the transaction comprise:
• 30 Knightsbridge Road in Piscataway, which consists of four interconnected buildings that total 686,316 square feet.
• 470 Chestnut Ridge Road in Woodcliff Lake, a two-story, 53,730-square-foot class A office building.
• 530 Chestnut Ridge Road in Woodcliff Lake, a three-story, 57,204-square-foot class A office building.