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Mack-Cali (CLI) Q3 FFO Surpasses, Revenues Miss Estimates
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Mack-Cali Realty Corp’s third-quarter 2020 core funds from operations (FFO) per share of 30 cents outpaced the Zacks Consensus Estimate of 29 cents. However, the figure compares unfavorably with the year-ago quarter’s 38 cents.
Results reflect increase in same-store cash net operating income (NOI) for the office portfolio. However, leasing activity shrunk in the company’s office and multi-family portfolios. Moreover, same-store NOI decreased year over year in the multi-family portfolio.
Quarterly revenues of $77.7 million missed the Zacks Consensus Estimate of $118.3 million. The revenue figure also comes in 11.1% lower than the prior-year quarter’s $87.4 million.
During the third quarter, the company collected average office rents of 96.9% and average residential rents of 99.5%.
Quarter in Detail
As of Sep 30, 2020, Mack-Cali’s consolidated core office properties were 78.2% leased, reflecting a decrease from 80.3% as of Jun 30, 2020. Notably, the Class A suburban portfolio was leased 89%, while Suburban and Waterfront portfolios were leased 70% and 76.9%, respectively, as of the same date.
Same-store cash revenues for the office portfolio climbed 8.4% and the same-store cash NOI was up 15.4%, year over year.
During the reported quarter, Mack-Cali executed 10 lease deals, spanning 153,827 square feet, in the company’s core office portfolio. All these leases were lease renewals and other tenant-retention transactions.
In addition, for the core portfolio, the rental rate roll up for third-quarter 2020 transactions was 12.3% on a cash basis.
Further, Roseland, the company’’s subsidiary engaged in multi-family residential operations, reported that its overall operating portfolio was 89.5% leased at the end of the quarter, contracting 310 basis points (bps) from the prior quarter’s end. The multi-family portfolio, which comprised 4,838 units, witnessed a same-store NOI decline of 17.4% from the prior-year quarter.
Portfolio Activity
During the third quarter, the company concluded the Phase 1 sale of its Parsippany and Giralda Farms portfolio for a total price of $167.6 million. The portfolio comprises 11 office buildings and spans an area of 1.6 million square feet. Also, the company completed the sale of 9 Campus Drive, the first asset of its Phase 2 sales tranche in the same portfolio for $21 million. The office property spans an area of 156,495 square feet.
Additionally, the company completed the sale of 325 Columbia Turnpike for $25.8 million. The office property is located in Florham Park, NJ, and spans an area of 168,144 square foot.
Balance Sheet Position
The company exited third-quarter 2020 with $22.9 million in cash, down from $25.6 million as of Dec 31, 2019.
Mack-Cali’s net debt to adjusted EBITDA was 12.1X for the reported quarter compared with the prior-year quarter’s 11.4X.
Dividend Update
On Sep 30, the company announced the suspension of its dividend payments for the third and fourth quarters of 2020. The move has been taken to support its financial flexibility amid the uncertainties due to the pandemic.
Notably, the dividend suspension will enhance Mack-Cali’s financial flexibility during the pandemic. It will also help preserve the incremental capital required to support leasing initiatives at the company’s Harborside campus on the Jersey City waterfront.
Since Mack-Cali has satisfied the dividend obligation on taxable income expected for 2020, the move does not affect the company’s REIT status. Nonetheless, its board will likely reconsider the resumption of the quarterly dividend in first-quarter 2021.
MackCali Realty Corporation Price, Consensus and EPS Surprise
Boston Properties Inc.’s (BXP - Free Report) third-quarter 2020 FFO per share of $1.57 missed the Zacks Consensus Estimate of $1.64. The reported figure also decreased 4.3% from the year-ago quarter’s $1.64.
SITE Centers Corp.’s (SITC - Free Report) third-quarter operating FFO per share of 23 cents came in line with the Zacks Consensus Estimate. The reported figure, however, declined 23.3% year over year.
Highwoods Properties, Inc. (HIW - Free Report) third-quarter 2020 FFO per share of 86 cents missed the Zacks Consensus Estimate of 88 cents. The figure included 5 cents from debt extinguishment charges and non-cash straight-line credit losses. Nonetheless, the reported figure improved 3.6% from the 83 cents reported in the year-ago period.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
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Mack-Cali (CLI) Q3 FFO Surpasses, Revenues Miss Estimates
Mack-Cali Realty Corp’s third-quarter 2020 core funds from operations (FFO) per share of 30 cents outpaced the Zacks Consensus Estimate of 29 cents. However, the figure compares unfavorably with the year-ago quarter’s 38 cents.
Results reflect increase in same-store cash net operating income (NOI) for the office portfolio. However, leasing activity shrunk in the company’s office and multi-family portfolios. Moreover, same-store NOI decreased year over year in the multi-family portfolio.
Quarterly revenues of $77.7 million missed the Zacks Consensus Estimate of $118.3 million. The revenue figure also comes in 11.1% lower than the prior-year quarter’s $87.4 million.
During the third quarter, the company collected average office rents of 96.9% and average residential rents of 99.5%.
Quarter in Detail
As of Sep 30, 2020, Mack-Cali’s consolidated core office properties were 78.2% leased, reflecting a decrease from 80.3% as of Jun 30, 2020. Notably, the Class A suburban portfolio was leased 89%, while Suburban and Waterfront portfolios were leased 70% and 76.9%, respectively, as of the same date.
Same-store cash revenues for the office portfolio climbed 8.4% and the same-store cash NOI was up 15.4%, year over year.
During the reported quarter, Mack-Cali executed 10 lease deals, spanning 153,827 square feet, in the company’s core office portfolio. All these leases were lease renewals and other tenant-retention transactions.
In addition, for the core portfolio, the rental rate roll up for third-quarter 2020 transactions was 12.3% on a cash basis.
Further, Roseland, the company’’s subsidiary engaged in multi-family residential operations, reported that its overall operating portfolio was 89.5% leased at the end of the quarter, contracting 310 basis points (bps) from the prior quarter’s end. The multi-family portfolio, which comprised 4,838 units, witnessed a same-store NOI decline of 17.4% from the prior-year quarter.
Portfolio Activity
During the third quarter, the company concluded the Phase 1 sale of its Parsippany and Giralda Farms portfolio for a total price of $167.6 million. The portfolio comprises 11 office buildings and spans an area of 1.6 million square feet. Also, the company completed the sale of 9 Campus Drive, the first asset of its Phase 2 sales tranche in the same portfolio for $21 million. The office property spans an area of 156,495 square feet.
Additionally, the company completed the sale of 325 Columbia Turnpike for $25.8 million. The office property is located in Florham Park, NJ, and spans an area of 168,144 square foot.
Balance Sheet Position
The company exited third-quarter 2020 with $22.9 million in cash, down from $25.6 million as of Dec 31, 2019.
Mack-Cali’s net debt to adjusted EBITDA was 12.1X for the reported quarter compared with the prior-year quarter’s 11.4X.
Dividend Update
On Sep 30, the company announced the suspension of its dividend payments for the third and fourth quarters of 2020. The move has been taken to support its financial flexibility amid the uncertainties due to the pandemic.
Notably, the dividend suspension will enhance Mack-Cali’s financial flexibility during the pandemic. It will also help preserve the incremental capital required to support leasing initiatives at the company’s Harborside campus on the Jersey City waterfront.
Since Mack-Cali has satisfied the dividend obligation on taxable income expected for 2020, the move does not affect the company’s REIT status. Nonetheless, its board will likely reconsider the resumption of the quarterly dividend in first-quarter 2021.
MackCali Realty Corporation Price, Consensus and EPS Surprise
MackCali Realty Corporation price-consensus-eps-surprise-chart | MackCali Realty Corporation Quote
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.
Performance of Other REITS
Boston Properties Inc.’s (BXP - Free Report) third-quarter 2020 FFO per share of $1.57 missed the Zacks Consensus Estimate of $1.64. The reported figure also decreased 4.3% from the year-ago quarter’s $1.64.
SITE Centers Corp.’s (SITC - Free Report) third-quarter operating FFO per share of 23 cents came in line with the Zacks Consensus Estimate. The reported figure, however, declined 23.3% year over year.
Highwoods Properties, Inc. (HIW - Free Report) third-quarter 2020 FFO per share of 86 cents missed the Zacks Consensus Estimate of 88 cents. The figure included 5 cents from debt extinguishment charges and non-cash straight-line credit losses. Nonetheless, the reported figure improved 3.6% from the 83 cents reported in the year-ago period.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>