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Mack-Cali Realty (CLI) Q3 FFO & Revenues Beat Estimates

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Mack-Cali’s third-quarter 2021 core FFO per share of 17 cents topped the Zacks Consensus Estimate of 13 cents. However, the figure compares unfavorably with the year-ago quarter’s 30 cents.

Results reflect a year-over-year increases in the same-store net operating income (NOI) for the office portfolio and the multi-family portfolio.

In fact, per management, “I am pleased to announce another active quarter during which we further simplified the business, continued to enhance our operational platform and capitalized on the continued strength in multifamily leasing demand. We continue to see strong interest in our high quality assets, with occupancy in our multifamily portfolio now above pre-Covid levels."

Quarterly revenues of $83.7 million surpassed the Zacks Consensus Estimate of $77.1 million. Further, the revenue figure came in 5.7% higher than the prior-year quarter’s number.

Quarter in Detail

As of Sep 30, 2021, Mack-Cali’s consolidated core office properties were 73.5% leased, compared to 74.7% as of Jun 3, 2021. The Waterfront portfolio was 73.3% leased, down from the 75.4% seen as of the second-quarter end.

While same-store revenues for the office portfolio decreased 2.1%, the same-store cash NOI was up 3.4% year over year, backed by savings in operating expenses.

In the reported quarter, Mack-Cali executed new or renewal/extension lease deals, spanning 176,100 square feet, in the company’s office portfolio.

Further, the company’s subsidiary, Roseland, which engages in multi-family residential operations, reported that its overall operating portfolio was 96.5% occupied as of Oct 24, up from the prior-quarter end’s 92.3%.

The same store multi-family portfolio, which comprised 5,499 units, witnessed same-store NOI growth of 6.5% from the prior-year period, reflecting higher revenues from the recovering leasing activity, driving lower vacancy and higher in-place rents.

Portfolio Activity

During the third quarter, the company completed the disposal of its joint-venture interest in the Crystal Lake office property and 7 Giralda Farms, for $1.9 million $29 million, respectively.

In addition, the company entered into separate definitive agreements to sell two of its waterfront office properties for a combined sales price of $590 million.

Balance Sheet Position

Mack-Cali exited third-quarter 2021 with $23.3 million in cash, down from $38.1 million as of Dec 31, 2020.

The company’s net debt to adjusted EBITDA was 15.2X for the reported quarter compared with the prior-year quarter’s 12.1X.

The company currently carries a Zacks Rank #4 (Sell).

MackCali Realty Corporation Price, Consensus and EPS Surprise

MackCali Realty Corporation Price, Consensus and EPS Surprise

MackCali Realty Corporation price-consensus-eps-surprise-chart | MackCali Realty Corporation Quote

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other REITs

Prologis, Inc. (PLD - Free Report) came up with third-quarter core FFO per share of $1.04, surpassing the Zacks Consensus Estimate of $1.03. Results reflected solid increases in market rents and valuations amid unprecedented low vacancies in its markets.

Boston Properties Inc.’s (BXP - Free Report) third-quarter 2021 FFO per share of $1.73 beat the Zacks Consensus Estimate of $1.70. The quarterly figure also exceeded the mid-point of the company’s third-quarter guidance by 4 cents, highlighting better-than-projected results from the in-service portfolio and improved parking revenues.

Highwoods Properties, Inc.’s (HIW - Free Report) FFO per share of 96 cents topped the Zacks Consensus Estimate of 93 cents for the September-end quarter. Rental and other revenues of $195.5 million outpaced the consensus mark of $192.2 million.

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.


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