Mack-Cali Realty Corp’s fourth-quarter 2019 core funds from operations (FFO) per share of 44 cents surpassed the Zacks Consensus Estimate of 41 cents. However, the figure compares unfavorably with the year-ago quarter’s reported tally of 45 cents.
The company’s same-store cash net operating income (NOI) for the office portfolio increased year over year. However, there was a slowdown in leasing activity in its office portfolio.
Quarterly revenues of $86.7 million missed the Zacks Consensus Estimate of $138.7 million, as well as came in lower than the prior-year quarter’s $90.3 million.
For full-year 2019, Mack- Cali reported core FFO per share of $1.62, displaying a decline of 11.5% from the prior year’s $1.83. Revenues for the year came in at $350.9 million, down 4% year on year.
Quarter in Detail
As of Dec 31, 2019, Mack-Cali’s consolidated core office properties were 80.7% leased, reflecting a decline from 83.2% as of Dec 31, 2018. Notably, Class A suburban portfolio was leased 89.7%, while Suburban and Waterfront portfolios were leased 79% and 77.8%, respectively, as of the same date.
Same-store cash revenues for the office portfolio inched up 0.9%, and the same-store cash NOI was up 3.5% year over year.
During the reported quarter, Mack-Cali executed 21 lease deals, spanning 169,333 square feet, in the company’s consolidated in-service commercial portfolio. This comprised 30.5% for new leases, and 69.5% for lease renewals and other tenant-retention transactions.
In addition, for the core portfolio, rental rate roll up for fourth-quarter 2019 transactions was 6.5% on a cash basis. For new transactions, rental rate roll up was 5.8% on a cash basis, while for renewals and other tenant retention deals, it was 6.7% on a cash basis.
Moreover, Roseland's multifamily stabilized operating portfolio was 95% leased at the end of the quarter, shrinking 170 basis points (bps) from the prior quarter’s end. Same-store NOI climbed 5.4% year over year.
Portfolio Activity
During the fourth quarter, Mack- Cali concluded the sale of its 1386-unit residential community in Malden and Revere, MA for $411.5 million. Further, the company sold an 180,000-square-foot fully-leased office building — 3600 Route 66 — in Neptune, NJ for $26.05 million. The company also sold a 317,000-square-foot office building — 5 Wood Hollow Road — in Parsipanny, NJ for $29.3 million.
Balance Sheet Position
Mack-Cali’s net debt to adjusted EBITDA was 9.7X for the fourth quarter compared with 9.3X in the prior-year quarter.
Finally, the company exited fourth-quarter 2019 with $25.6 million in cash, down from $29.6 million as of Dec 31, 2018.
Guidance
Mack-Cali expects 2020 core FFO per share of $1.24-$1.36. The Zacks Consensus Estimate for the same is currently pinned at $1.45.
The company projects office occupancy (year-end % leased) of 79-81% and dispositions of $1.0-$1.2 billion for the ongoing year.
Mack-Cali currently carries a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Stocks to ConsiderPrologis, Inc
. (PLD - Free Report) currently carries a Zacks Rank of 2. The company’s FFO per share estimate for 2020 has been revised 2.5% upward to $3.72 in a month’s time. The stock has rallied 30% in 12 months’ time.
Highwoods Properties’ (HIW - Free Report) Zacks Consensus Estimate for the current-year FFO per share has moved marginally upward to $3.63 over the past month. Shares of this Zacks #2 Ranked company have gained 7% over the past year.
Piedmont Office Realty Trust, Inc. (PDM - Free Report) also carries a Zacks Rank of 2, currently. The company’s ongoing-year FFO per share estimate moved 3.2% north to $1.96 in a month’s time. The stock has rallied 13.21% in the past 12 months.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2019, while the S&P 500 gained and impressive +53.6%, five of our strategies returned +65.8%, +97.1%, +118.0%, +175.7% and even +186.7%.
This outperformance has not just been a recent phenomenon. From 2000 – 2019, while the S&P averaged +6.0% per year, our top strategies averaged up to +54.7% per year.
See their latest picks free >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Mack-Cali Realty Corp’s fourth-quarter 2019 core funds from operations (FFO) per share of 44 cents surpassed the Zacks Consensus Estimate of 41 cents. However, the figure compares unfavorably with the year-ago quarter’s reported tally of 45 cents.
The company’s same-store cash net operating income (NOI) for the office portfolio increased year over year. However, there was a slowdown in leasing activity in its office portfolio.
Quarterly revenues of $86.7 million missed the Zacks Consensus Estimate of $138.7 million, as well as came in lower than the prior-year quarter’s $90.3 million.
For full-year 2019, Mack- Cali reported core FFO per share of $1.62, displaying a decline of 11.5% from the prior year’s $1.83. Revenues for the year came in at $350.9 million, down 4% year on year.
Quarter in Detail
As of Dec 31, 2019, Mack-Cali’s consolidated core office properties were 80.7% leased, reflecting a decline from 83.2% as of Dec 31, 2018. Notably, Class A suburban portfolio was leased 89.7%, while Suburban and Waterfront portfolios were leased 79% and 77.8%, respectively, as of the same date.
Same-store cash revenues for the office portfolio inched up 0.9%, and the same-store cash NOI was up 3.5% year over year.
During the reported quarter, Mack-Cali executed 21 lease deals, spanning 169,333 square feet, in the company’s consolidated in-service commercial portfolio. This comprised 30.5% for new leases, and 69.5% for lease renewals and other tenant-retention transactions.
In addition, for the core portfolio, rental rate roll up for fourth-quarter 2019 transactions was 6.5% on a cash basis. For new transactions, rental rate roll up was 5.8% on a cash basis, while for renewals and other tenant retention deals, it was 6.7% on a cash basis.
Moreover, Roseland's multifamily stabilized operating portfolio was 95% leased at the end of the quarter, shrinking 170 basis points (bps) from the prior quarter’s end. Same-store NOI climbed 5.4% year over year.
Portfolio Activity
During the fourth quarter, Mack- Cali concluded the sale of its 1386-unit residential community in Malden and Revere, MA for $411.5 million. Further, the company sold an 180,000-square-foot fully-leased office building — 3600 Route 66 — in Neptune, NJ for $26.05 million. The company also sold a 317,000-square-foot office building — 5 Wood Hollow Road — in Parsipanny, NJ for $29.3 million.
Balance Sheet Position
Mack-Cali’s net debt to adjusted EBITDA was 9.7X for the fourth quarter compared with 9.3X in the prior-year quarter.
Finally, the company exited fourth-quarter 2019 with $25.6 million in cash, down from $29.6 million as of Dec 31, 2018.
Guidance
Mack-Cali expects 2020 core FFO per share of $1.24-$1.36. The Zacks Consensus Estimate for the same is currently pinned at $1.45.
The company projects office occupancy (year-end % leased) of 79-81% and dispositions of $1.0-$1.2 billion for the ongoing year.
Mack-Cali currently carries a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Stocks to Consider
Prologis, Inc
. (PLD - Free Report) currently carries a Zacks Rank of 2. The company’s FFO per share estimate for 2020 has been revised 2.5% upward to $3.72 in a month’s time. The stock has rallied 30% in 12 months’ time.Highwoods Properties’ (HIW - Free Report) Zacks Consensus Estimate for the current-year FFO per share has moved marginally upward to $3.63 over the past month. Shares of this Zacks #2 Ranked company have gained 7% over the past year.
Piedmont Office Realty Trust, Inc. (PDM - Free Report) also carries a Zacks Rank of 2, currently. The company’s ongoing-year FFO per share estimate moved 3.2% north to $1.96 in a month’s time. The stock has rallied 13.21% in the past 12 months.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2019, while the S&P 500 gained and impressive +53.6%, five of our strategies returned +65.8%, +97.1%, +118.0%, +175.7% and even +186.7%.
This outperformance has not just been a recent phenomenon. From 2000 – 2019, while the S&P averaged +6.0% per year, our top strategies averaged up to +54.7% per year.
See their latest picks free >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Get the latest research report on PLD - FREE
Get the latest research report on HIW - FREE
Get the latest research report on PDM - FREE