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2023
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Veris Residential, Inc.
Mack-Cali Realty Corporation
Mack-Cali Realty,
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| 22-3305147 (Veris Residential, Inc.) | ||||||
Delaware (Veris Residential, L.P.) | 22-3315804 (Veris Residential, L.P.) | |||||||
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
| Harborside 3, 210 Hudson St., Ste. 400, Jersey City, New Jersey | 07311 | |||||||
(Address of principal executive offices) | (Zip Code) | |||||||
and is structured as a partnership with no publicly traded equity. Except for the net proceeds from equity offerings by the General Partner, which are contributed to the capital of the Operating Partnership in consideration of common or preferred units in the Operating Partnership, as applicable, the Operating Partnership generates all remaining capital required by the Company’s business. These sources include working capital, net cash provided by operating activities, borrowings under the Company’s 2022. September 30, December 31, 2017 2016 ASSETS Rental property Land and leasehold interests $ 712,166 $ 661,335 Buildings and improvements 4,021,241 3,758,210 Tenant improvements 344,465 364,092 Furniture, fixtures and equipment 29,355 21,230 5,107,227 4,804,867 Less — accumulated depreciation and amortization (1,146,091 ) (1,332,073 ) 3,961,136 3,472,794 Rental property held for sale, net 116,958 39,743 Net investment in rental property 4,078,094 3,512,537 Cash and cash equivalents 88,789 31,611 Investments in unconsolidated joint ventures 238,440 320,047 Unbilled rents receivable, net 102,280 101,052 Deferred charges, goodwill and other assets, net 439,864 267,950 Restricted cash 40,473 53,952 Accounts receivable, net of allowance for doubtful accounts of $1,320 and $1,335 7,579 9,617 Total assets $ 4,995,519 $ 4,296,766 LIABILITIES AND EQUITY Senior unsecured notes, net $ 818,764 $ 817,355 Unsecured revolving credit facility and term loans 671,838 634,069 Mortgages, loans payable and other obligations, net 1,348,584 888,585 Dividends and distributions payable 20,929 15,327 Accounts payable, accrued expenses and other liabilities 182,929 159,874 Rents received in advance and security deposits 46,355 46,442 Accrued interest payable 16,776 8,427 Total liabilities 3,106,175 2,570,079 Commitments and contingencies Redeemable noncontrolling interests 209,070 — Equity: Mack-Cali Realty Corporation stockholders’ equity: Common stock, $0.01 par value, 190,000,000 shares authorized, 89,913,576 and 89,696,713 shares outstanding 899 897 Additional paid-in capital 2,566,069 2,576,473 Dividends in excess of net earnings (1,081,028 ) (1,052,184 ) Accumulated other comprehensive income 2,526 1,985 Total Mack-Cali Realty Corporation stockholders’ equity 1,488,466 1,527,171 Noncontrolling interests in subsidiaries: Operating Partnership 172,809 178,570 Consolidated joint ventures 18,999 20,946 Total noncontrolling interests in subsidiaries 191,808 199,516 Total equity 1,680,274 1,726,687 Total liabilities and equity $ 4,995,519 $ 4,296,766 Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 REVENUES Base rents $ 128,643 $ 129,523 $ 382,915 $ 380,133 Escalations and recoveries from tenants 16,385 16,177 47,455 45,248 Real estate services 5,748 6,650 17,980 19,931 Parking income 5,766 3,443 15,047 10,131 Other income 3,476 1,724 9,274 4,224 Total revenues 160,018 157,517 472,671 459,667 EXPENSES Real estate taxes 21,300 20,606 63,609 66,250 Utilities 11,480 14,127 33,251 38,658 Operating services 26,312 25,553 80,495 76,309 Real estate services expenses 6,207 6,361 18,376 19,418 General and administrative 13,140 14,007 37,223 39,011 Acquisition-related costs — 815 — 2,854 Depreciation and amortization 52,375 48,117 157,768 134,639 Total expenses 130,814 129,586 390,722 377,139 Operating income 29,204 27,931 81,949 82,528 OTHER (EXPENSE) INCOME Interest expense (25,634 ) (24,233 ) (70,898 ) (72,158 ) Interest and other investment income (loss) 762 1,262 1,358 739 Equity in earnings (loss) of unconsolidated joint ventures (1,533 ) 21,790 (4,882 ) 19,622 Gain on change of control of interests — — — 15,347 Realized gains (losses) and unrealized losses on disposition of rental property, net 31,336 (17,053 ) (2,112 ) 68,664 Gain on sale of investment in unconsolidated joint venture 10,568 — 23,131 5,670 Gain (loss) from extinguishment of debt, net — (19,302 ) (239 ) (6,882 ) Total other income (expense) 15,499 (37,536 ) (53,642 ) 31,002 Net income (loss) 44,703 (9,605 ) 28,307 113,530 Noncontrolling interest in consolidated joint ventures 447 65 865 460 Noncontrolling interest in Operating Partnership (4,413 ) 999 (2,412 ) (11,947 ) Redeemable noncontrolling interest (2,683 ) — (6,157 ) — Net income (loss) available to common shareholders $ 38,054 $ (8,541 ) $ 20,603 $ 102,043 Basic earnings per common share: Net income (loss) available to common shareholders $ 0.39 $ (0.10 ) $ 0.06 $ 1.14 Diluted earnings per common share: Net income (loss) available to common shareholders $ 0.39 $ (0.10 ) $ 0.06 $ 1.13 Basic weighted average shares outstanding 90,023 89,755 89,997 89,739 Diluted weighted average shares outstanding 100,727 100,253 100,701 100,486 Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Net income (loss) $ 44,703 $ (9,605 ) $ 28,307 $ 113,530 Other comprehensive income: Net unrealized gain (loss) on derivative instruments for interest rate swaps 730 1,725 604 (7,528 ) Comprehensive income (loss) $ 45,433 $ (7,880 ) $ 28,911 $ 106,002 Comprehensive (income) loss attributable to noncontrolling interest in consolidated joint ventures 447 65 865 460 Comprehensive (income) loss attributable to redeemable noncontrolling interest (2,683 ) — (6,157 ) — Comprehensive (income) loss attributable to noncontrolling interest in Operating Partnership (4,489 ) 818 (2,475 ) (11,158 ) Comprehensive income (loss) attributable to common shareholders $ 38,708 $ (6,997 ) $ 21,144 $ 95,304 Accumulated Additional Dividends in Other Noncontrolling Common Stock Paid-In Excess of Comprehensive Interests Total Shares Par Value Capital Net Earnings Income (Loss) in Subsidiaries Equity Balance at January 1, 2017 89,697 $ 897 $ 2,576,473 $ (1,052,184 ) $ 1,985 $ 199,516 $ 1,726,687 Net income (loss) — — — 20,603 — 7,704 28,307 Common stock dividends — — — (49,447 ) — — (49,447 ) Common unit distributions — — — — — (6,295 ) (6,295 ) Issuance of limited partner common units — — — — — 2,793 2,793 Redeemable noncontrolling interest — — (15,139 ) — — (7,905 ) (23,044 ) Decrease in noncontrolling interest in consolidated joint ventures — — (3,787 ) — — (1,082 ) (4,869 ) Redemption of common units for common stock 149 1 2,530 — — (2,531 ) — Shares issued under Dividend Reinvestment and Stock Purchase Plan 2 — 58 — — — 58 Directors’ deferred compensation plan — — 358 — — — 358 Stock compensation 70 1 1,965 — — 3,302 5,268 Cancellation of restricted shares (4 ) — (146 ) — — — (146 ) Other comprehensive income (loss) — — — — 541 63 604 Rebalancing of ownership percentage between parent and subsidiaries — — 3,757 — — (3,757 ) — Balance at September 30, 2017 89,914 $ 899 $ 2,566,069 $ (1,081,028 ) $ 2,526 $ 191,808 $ 1,680,274 Nine Months Ended September 30, 2017 2016 CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 28,307 $ 113,530 Adjustments to reconcile net income to net cash provided by Operating activities: Depreciation and amortization, including related intangible assets 153,057 134,756 Amortization of directors deferred compensation stock units 358 285 Amortization of stock compensation 5,268 4,299 Amortization of deferred financing costs 3,462 3,583 Amortization of debt discount and mark-to-market (86 ) 1,417 Equity in (earnings) loss of unconsolidated joint ventures 4,882 (19,622 ) Distributions of cumulative earnings from unconsolidated joint ventures 6,502 4,833 Gain on change of control of interests — (15,347 ) Realized (gains) losses and unrealized losses on disposition of rental property, net 2,112 (68,664 ) Gain on sale of investments in unconsolidated joint ventures (23,131 ) (5,670 ) Loss (gain) from extinguishment of debt 239 (12,420 ) Changes in operating assets and liabilities: Increase in unbilled rents receivable, net (11,270 ) (9,860 ) Increase in deferred charges, goodwill and other assets (13,244 ) (11,173 ) Decrease in accounts receivable, net 2,038 424 Increase (decrease) in accounts payable, accrued expenses and other liabilities (3,715 ) (12,656 ) Decrease in rents received in advance and security deposits (720 ) (1,425 ) Increase (decrease) in accrued interest payable 8,553 (1,500 ) Net cash provided by operating activities $ 162,612 $ 104,790 CASH FLOWS FROM INVESTING ACTIVITIES Rental property acquisitions and related intangibles $ (543,414 ) $ (405,808 ) Rental property additions and improvements (67,797 ) (94,017 ) Development of rental property and other related costs (201,513 ) (150,592 ) Proceeds from the sales of rental property 241,430 409,101 Proceeds from the sale of investments in unconsolidated joint ventures 107,009 6,420 Investments in notes receivable (47,049 ) — Repayment of notes receivable 9,620 375 Investment in unconsolidated joint ventures (19,279 ) (31,318 ) Distributions in excess of cumulative earnings from unconsolidated joint ventures 4,699 20,906 Proceeds from investment receivable 3,625 — Decrease (increase) in restricted cash 7,985 (287 ) Net cash used in investing activities $ (504,684 ) $ (245,220 ) CASH FLOW FROM FINANCING ACTIVITIES Borrowings from revolving credit facility $ 428,000 $ 793,000 Repayment of revolving credit facility (714,000 ) (853,000 ) Repayment of senior unsecured notes — (314,755 ) Borrowings from unsecured term loan 325,000 350,000 Proceeds from mortgages and loans payable 395,859 426,613 Repayment of mortgages, loans payable and other obligations (108,468 ) (187,969 ) Acquisition of noncontrolling interests (2,011 ) (37,946 ) Issuance of redeemable noncontrolling interests, net 139,002 — Payment of financing costs (9,051 ) (7,050 ) (Distribution to) contributions from noncontrolling interests (19 ) 1,065 Payment of dividends and distributions (55,062 ) (45,050 ) Net cash provided by financing activities $ 399,250 $ 124,908 Net increase (decrease) in cash and cash equivalents $ 57,178 $ (15,522 ) Cash and cash equivalents, beginning of period 31,611 37,077 Cash and cash equivalents, end of period $ 88,789 $ 21,555 September 30, December 31, 2017 2016 ASSETS Rental property Land and leasehold interests $ 712,166 $ 661,335 Buildings and improvements 4,021,241 3,758,210 Tenant improvements 344,465 364,092 Furniture, fixtures and equipment 29,355 21,230 5,107,227 4,804,867 Less — accumulated depreciation and amortization (1,146,091 ) (1,332,073 ) 3,961,136 3,472,794 Rental property held for sale, net 116,958 39,743 Net investment in rental property 4,078,094 3,512,537 Cash and cash equivalents 88,789 31,611 Investments in unconsolidated joint ventures 238,440 320,047 Unbilled rents receivable, net 102,280 101,052 Deferred charges, goodwill and other assets, net 439,864 267,950 Restricted cash 40,473 53,952 Accounts receivable, net of allowance for doubtful accounts of $1,320 and $1,335 7,579 9,617 Total assets $ 4,995,519 $ 4,296,766 LIABILITIES AND EQUITY Senior unsecured notes, net $ 818,764 $ 817,355 Unsecured revolving credit facility and term loans 671,838 634,069 Mortgages, loans payable and other obligations, net 1,348,584 888,585 Distributions payable 20,929 15,327 Accounts payable, accrued expenses and other liabilities 182,929 159,874 Rents received in advance and security deposits 46,355 46,442 Accrued interest payable 16,776 8,427 Total liabilities 3,106,175 2,570,079 Commitments and contingencies Redeemable noncontrolling interests 209,070 — Partners’ Capital: General Partner, 89,913,576 and 89,696,713 common units outstanding 1,424,566 1,467,569 Limited partners, 10,438,855 and 10,488,105 common units outstanding 234,183 236,187 Accumulated other comprehensive income 2,526 1,985 Total Mack-Cali Realty, L.P. partners’ capital 1,661,275 1,705,741 Noncontrolling interests in consolidated joint ventures 18,999 20,946 Total equity 1,680,274 1,726,687 Total liabilities and equity $ 4,995,519 $ 4,296,766 Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 REVENUES Base rents $ 128,643 $ 129,523 $ 382,915 $ 380,133 Escalations and recoveries from tenants 16,385 16,177 47,455 45,248 Real estate services 5,748 6,650 17,980 19,931 Parking income 5,766 3,443 15,047 10,131 Other income 3,476 1,724 9,274 4,224 Total revenues 160,018 157,517 472,671 459,667 EXPENSES Real estate taxes 21,300 20,606 63,609 66,250 Utilities 11,480 14,127 33,251 38,658 Operating services 26,312 25,553 80,495 76,309 Real estate services expenses 6,207 6,361 18,376 19,418 General and administrative 13,140 14,007 37,223 39,011 Acquisition-related costs — 815 — 2,854 Depreciation and amortization 52,375 48,117 157,768 134,639 Total expenses 130,814 129,586 390,722 377,139 Operating income 29,204 27,931 81,949 82,528 OTHER (EXPENSE) INCOME Interest expense (25,634 ) (24,233 ) (70,898 ) (72,158 ) Interest and other investment income (loss) 762 1,262 1,358 739 Equity in earnings (loss) of unconsolidated joint ventures (1,533 ) 21,790 (4,882 ) 19,622 Gain on change of control of interests — — — 15,347 Realized gains (losses) and unrealized losses on disposition of rental property, net 31,336 (17,053 ) (2,112 ) 68,664 Gain on sale of investment in unconsolidated joint venture 10,568 — 23,131 5,670 Gain (loss) from extinguishment of debt, net — (19,302 ) (239 ) (6,882 ) Total other income (expense) 15,499 (37,536 ) (53,642 ) 31,002 Net income (loss) 44,703 (9,605 ) 28,307 113,530 Noncontrolling interest in consolidated joint ventures 447 65 865 460 Redeemable noncontrolling interest (2,683 ) — (6,157 ) — Net income (loss) available to common unitholders $ 42,467 $ (9,540 ) $ 23,015 $ 113,990 Basic earnings per common unit: Net income (loss) available to common unitholders $ 0.39 $ (0.10 ) $ 0.06 $ 1.14 Diluted earnings per common unit: Net income (loss) available to common unitholders $ 0.39 $ (0.10 ) $ 0.06 $ 1.13 Basic weighted average units outstanding 100,462 100,253 100,391 100,241 Diluted weighted average units outstanding 100,727 100,253 100,701 100,486 Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Net income (loss) $ 44,703 $ (9,605 ) $ 28,307 $ 113,530 Other comprehensive income: Net unrealized gain (loss) on derivative instruments for interest rate swaps 730 1,725 604 (7,528 ) Comprehensive income (loss) $ 45,433 $ (7,880 ) $ 28,911 $ 106,002 Comprehensive (income) loss attributable to noncontrolling interest in consolidated joint ventures 447 65 865 460 Comprehensive (income) loss attributable to redeemable noncontrolling interest (2,683 ) — (6,157 ) — Comprehensive income (loss) attributable to common unitholders $ 43,197 $ (7,815 ) $ 23,619 $ 106,462 Accumulated Noncontrolling General Partner Limited Partner Other Interest General Partner Limited Partner Common Common Comprehensive in Consolidated Common Units Common Units Unitholders Unitholders Income (Loss) Joint Ventures Total Equity Balance at January 1, 2017 89,697 10,488 $ 1,467,569 $ 236,187 $ 1,985 $ 20,946 $ 1,726,687 Net income (loss) — — 20,603 2,412 — 5,292 28,307 Distributions — — (49,447 ) (6,295 ) — — (55,742 ) Issuance of limited partner common units — 99 — 2,793 — — 2,793 Redeemable noncontrolling interest — — (15,139 ) (1,748 ) — (6,157 ) (23,044 ) Decrease in noncontrolling interest — — (3,787 ) — — (1,082 ) (4,869 ) Redemption of limited partner common units for shares of general partner common units 149 (149 ) 2,531 (2,531 ) — — — Shares issued under Dividend Reinvestment and Stock Purchase Plan 2 — 58 — — — 58 Directors’ deferred compensation plan — — 358 — — — 358 Other comprehensive income — — — 63 541 — 604 Stock compensation 70 — 1,966 3,302 — — 5,268 Cancellation of restricted shares (4 ) — (146 ) — — — (146 ) Balance at September 30, 2017 89,914 10,438 $ 1,424,566 $ 234,183 $ 2,526 $ 18,999 $ 1,680,274 Nine Months Ended September 30, 2017 2016 CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 28,307 $ 113,530 Adjustments to reconcile net income to net cash provided by Operating activities: Depreciation and amortization, including related intangible assets 153,057 134,756 Amortization of directors deferred compensation stock units 358 285 Amortization of stock compensation 5,268 4,299 Amortization of deferred financing costs 3,462 3,583 Amortization of debt discount and mark-to-market (86 ) 1,417 Equity in (earnings) loss of unconsolidated joint ventures 4,882 (19,622 ) Distributions of cumulative earnings from unconsolidated joint ventures 6,502 4,833 Gain on change of control of interests — (15,347 ) Realized (gains) losses and unrealized losses on disposition of rental property, net 2,112 (68,664 ) Gain on sale of investments in unconsolidated joint ventures (23,131 ) (5,670 ) Loss (gain) from extinguishment of debt 239 (12,420 ) Changes in operating assets and liabilities: Increase in unbilled rents receivable, net (11,270 ) (9,860 ) Increase in deferred charges, goodwill and other assets (13,244 ) (11,173 ) Decrease in accounts receivable, net 2,038 424 Increase (decrease) in accounts payable, accrued expenses and other liabilities (3,715 ) (12,656 ) Decrease in rents received in advance and security deposits (720 ) (1,425 ) Increase (decrease) in accrued interest payable 8,553 (1,500 ) Net cash provided by operating activities $ 162,612 $ 104,790 CASH FLOWS FROM INVESTING ACTIVITIES Rental property acquisitions and related intangibles $ (543,414 ) $ (405,808 ) Rental property additions and improvements (67,797 ) (94,017 ) Development of rental property and other related costs (201,513 ) (150,592 ) Proceeds from the sales of rental property 241,430 409,101 Proceeds from the sale of investments in unconsolidated joint ventures 107,009 6,420 Investments in notes receivable (47,049 ) — Repayment of notes receivable 9,620 375 Investment in unconsolidated joint ventures (19,279 ) (31,318 ) Distributions in excess of cumulative earnings from unconsolidated joint ventures 4,699 20,906 Proceeds from investment receivable 3,625 — Decrease (increase) in restricted cash 7,985 (287 ) Net cash used in investing activities $ (504,684 ) $ (245,220 ) CASH FLOW FROM FINANCING ACTIVITIES Borrowings from revolving credit facility $ 428,000 $ 793,000 Repayment of revolving credit facility (714,000 ) (853,000 ) Repayment of senior unsecured notes — (314,755 ) Borrowings from unsecured term loan 325,000 350,000 Proceeds from mortgages and loans payable 395,859 426,613 Repayment of mortgages, loans payable and other obligations (108,468 ) (187,969 ) Acquisition of noncontrolling interests (2,011 ) (37,946 ) Issuance of redeemable noncontrolling interests, net 139,002 — Payment of financing costs (9,051 ) (7,050 ) (Distribution to) contributions from noncontrolling interests (19 ) 1,065 Payment of distributions (55,062 ) (45,050 ) Net cash provided by financing activities $ 399,250 $ 124,908 Net increase (decrease) in cash and cash equivalents $ 57,178 $ (15,522 ) Cash and cash equivalents, beginning of period 31,611 37,077 Cash and cash equivalents, end of period $ 88,789 $ 21,555 2023 Term Loan, see Part II, Item 5. Other Information. balance sheets of Veris Residential, Inc. presentation, primarily related to classification of certain properties as discontinued operations. Property Acquisition # of Rentable Acquisition Date Property Address Location Bldgs. Square Feet Cost 01/11/17 Red Bank portfolio (a) Red Bank, New Jersey 3 279,472 $ 27,228 03/06/17 Short Hills/Madison portfolio (b) Short Hills & Madison, New Jersey 6 1,113,028 367,361 Total Acquisitions 9 1,392,500 $ 394,589 Red Bank Short Hills/Madison Portfolio Portfolio Total Land and leasehold interest $ 7,914 $ 30,336 $ 38,250 Buildings and improvements and other assets 16,047 295,299 311,346 Above market leases (a) 118 6,367 6,485 In-place lease values (a) 3,171 45,604 48,775 27,250 377,606 404,856 Less: Below market lease values (a) (22 ) (10,245 ) (10,267 ) Net assets recorded upon acquisition $ 27,228 $ 367,361 $ 394,589 Monaco Monaco Total North South Consolidation Land and leasehold interest $ 27,300 $ 31,461 $ 58,761 Buildings and improvements and other assets 112,841 129,895 242,736 Above market leases (a) 350 — 350 In-place lease values (a) 4,585 4,913 9,498 Less: Below market lease values (a) (141 ) (118 ) (259 ) 144,935 166,151 311,086 Less: Debt assumed at fair value (79,544 ) (91,656 ) (171,200 ) Net assets recorded upon consolidation $ 65,391 $ 74,495 $ 139,886 Realized Gains Rentable Net Net (losses)/ Disposition # of Square Sales Carrying Unrealized Date Property/Address Location Bldgs. Feet Proceeds Value Losses, net 01/30/17 Cranford portfolio Cranford, New Jersey 6 435,976 $ 26,598 $ 22,736 $ 3,862 01/31/17 440 Route 22 East (a) Bridgewater, New Jersey 1 198,376 10,074 10,069 5 02/07/17 3 Independence Way Princeton, New Jersey 1 111,300 11,549 9,910 1,639 05/15/17 103 Carnegie Center Princeton, New Jersey 1 96,000 15,063 (b) 8,271 6,792 08/29/17 400 Chestnut Ridge Road Woodcliff Lake, New Jersey 1 89,200 6,891 7,498 (607 ) 08/30/17 140 E. Ridgewood Avenue Paramus, New Jersey 1 239,680 30,201 30,737 (536 ) 08/30/17 Bergen portfolio Woodcliff Lake, Paramus and 5 1,061,544 86,973 (c) 135,121 (48,148 ) Rochelle Park, New Jersey 09/11/17 377 Summerhill Road East Brunswick, New Jersey 1 40,000 3,221 2,172 1,049 09/13/17 700 Executive Boulevard Elmsford, New York — — (d) 5,717 970 4,747 09/20/17 Totowa Portfolio Totowa, New Jersey 13 499,243 63,624 27,630 35,994 09/27/17 890 Mountain Avenue (e) New Providence, New Jersey 1 80,000 4,852 6,139 (1,287 ) 09/28/17 135 Chestnut Ridge Road Montvale, New Jersey 1 66,150 5,844 (f) 2,929 2,915 09/29/17 Moorestown portfolio Moorestown and Burlington, New Jersey 26 1,260,398 73,393 (g) 56,186 17,207 Sub-total 58 4,177,867 344,000 320,368 23,632 Unrealized losses on rental property held for sale (25,744 ) Totals 58 4,177,867 $ 344,000 $ 320,368 $ (2,112 ) real estate held for sale, net of expected selling costs, are expected to be approximately $131.7 million. September 30, 2017 Land $ 38,669 Buildings and improvements 187,328 Less: Accumulated depreciation (83,295 ) Less: Unrealized losses on properties held for sale (25,744 ) Rental property held for sale, net $ 116,958 2023. The Company has agreed to guarantee repayment of a portion of the debt of its unconsolidated joint ventures. As of Property Debt Number of Company’s Carrying Value As of September 30, 2017 Apartment Units Effective September 30, December 31, Maturity Interest Entity / Property Name or Rentable Square Feet (sf) Ownership% (a) 2017 2016 Balance Date Rate Multi-family Marbella RoseGarden, L.L.C./ Marbella 412 units 24.27 % $ 14,738 $ 15,150 $ 95,000 05/01/18 4.99% RoseGarden Monaco Holdings, L.L.C./ Monaco 523 units (e) — — — — — Rosewood Morristown, L.L.C. / Metropolitan at 40 Park (b) (c) 130 units 12.50 % 6,911 7,145 49,594 (d) (d) Riverwalk G Urban Renewal, L.L.C./ RiverTrace at Port Imperial 316 units 22.50 % 9,090 9,707 82,000 11/10/26 3.21% Elmajo Urban Renewal Associates, LLC / Lincoln Harbor (Bldg A&C) (o) 355 units 7.50 % — — — — — Crystal House Apartments Investors LLC / Crystal House (f) 825 units 25.00 % 30,914 30,565 165,000 04/01/20 3.17% Roseland/Port Imperial Partners, L.P./ Riverwalk C (b) (g) 360 units 20.00 % 2,311 1,678 — — — RoseGarden Marbella South, L.L.C./ Marbella II 311 units 24.27 % 16,812 18,050 74,690 03/30/18 L+2.25%(h) Estuary Urban Renewal Unit B, LLC / Lincoln Harbor (Bldg B) (o) 227 units 7.50 % — — — — — Riverpark at Harrison I, L.L.C./ Riverpark at Harrison 141 units 45.00 % 1,711 2,085 30,000 08/01/25 3.70% Capitol Place Mezz LLC / Station Townhouses 378 units 50.00 % 40,772 43,073 100,449 07/01/33 4.82% Harborside Unit A Urban Renewal, L.L.C. / URL Harborside 762 units 85.00 % 95,611 100,188 187,893 08/01/29 5.197%(i) RoseGarden Monaco, L.L.C./ San Remo Land (m) 250 potential units 41.67 % — 1,400 — — — Grand Jersey Waterfront URA, L.L.C./ Liberty Landing 850 potential units 50.00 % 337 337 — — — Hillsborough 206 Holdings, L.L.C./ Hillsborough 206 160,000 sf 50.00 % 1,962 1,962 — — — Plaza VIII & IX Associates, L.L.C./ Vacant land (parking operations) (n) 1,225,000 sf 50.00 % — 4,448 — — — Office Red Bank Corporate Plaza, L.L.C./ Red Bank 92,878 sf 50.00 % 4,669 4,339 14,026 05/17/18 L+3.00% 12 Vreeland Associates, L.L.C./ 12 Vreeland Road 139,750 sf 50.00 % 6,554 6,237 9,885 07/01/23 2.87% BNES Associates III / Offices at Crystal Lake 106,345 sf 31.25 % 3,199 3,124 4,969 11/01/23 4.76% KPG-P 100 IMW JV, LLC / 100 Independence Mall West 339,615 sf (l) — — — — — Keystone-Penn 1,842,820 sf (l) — — — — — Keystone-TriState 1,266,384 sf (l) — 2,285 — — — KPG-MCG Curtis JV, L.L.C./ Curtis Center (j) 885,000 sf 50.00 % — 65,400 — — — Other Roseland/North Retail, L.L.C./ Riverwalk at Port Imperial 30,745 sf 20.00 % 1,646 1,706 — — — South Pier at Harborside / Hyatt Regency Jersey City on the Hudson 350 rooms 50.00 % 223 163 99,111 10/01/26 3.668% Other (k) 980 1,005 — — — Totals: $ 238,440 $ 320,047 $ 912,617 Three Months Ended Nine Months Ended September 30, September 30, Entity / Property Name 2017 2016 2017 2016 Multi-family Marbella RoseGarden, L.L.C./ Marbella $ 52 $ 76 $ 261 $ 208 RoseGarden Monaco Holdings, L.L.C./ Monaco — (277 ) (266 ) (869 ) Rosewood Morristown, L.L.C. / Metropolitan at 40 Park (81 ) (76 ) (234 ) (239 ) Riverwalk G Urban Renewal, L.L.C./ RiverTrace at Port Imperial 52 (594 ) 143 (1,189 ) Crystal House Apartments Investors LLC / Crystal House (171 ) (99 ) (752 ) (321 ) Roseland/Port Imperial Partners, L.P./ Riverwalk C (298 ) (36 ) (712 ) (36 ) RoseGarden Marbella South, L.L.C./ Marbella II 25 105 86 (202 ) Riverpark at Harrison I, L.L.C./ Riverpark at Harrison (85 ) (43 ) (162 ) (173 ) Capitol Place Mezz LLC / Station Townhouses (447 ) (500 ) (1,272 ) (1,995 ) Harborside Unit A Urban Renewal, L.L.C. / URL Harborside (2,053 ) (42 ) (5,174 ) (60 ) Grand Jersey Waterfront URA, L.L.C./ Liberty Landing — — (15 ) (60 ) Hillsborough 206 Holdings, L.L.C./ Hillsborough 206 — (22 ) (25 ) (53 ) Plaza VIII & IX Associates, L.L.C./ Vacant land (parking operations) — 81 385 256 Office Red Bank Corporate Plaza, L.L.C./ Red Bank 90 111 306 321 12 Vreeland Associates, L.L.C./ 12 Vreeland Road 186 74 317 266 BNES Associates III / Offices at Crystal Lake 29 109 74 (68 ) Keystone-Penn — 150 — 450 Keystone-TriState — (518 ) — (1,186 ) KPG-MCG Curtis JV, L.L.C./ Curtis Center 148 113 (436 ) 518 Other Roseland/North Retail, L.L.C./ Riverwalk at Port Imperial (23 ) (14 ) (60 ) (39 ) South Pier at Harborside / Hyatt Regency Jersey City on the Hudson 973 22,447 2,310 23,267 Other 70 745 344 826 Company’s equity in earnings (loss) of unconsolidated joint ventures $ (1,533 ) $ 21,790 $ (4,882 ) $ 19,622 : September 30, December 31, (dollars in thousands) 2017 2016 Deferred leasing costs $ 200,486 $ 220,947 Deferred financing costs - unsecured revolving credit facility (a) 4,945 5,400 205,431 226,347 Accumulated amortization (95,819 ) (107,359 ) Deferred charges, net 109,612 118,988 Notes receivable (b) 114,760 13,251 In-place lease values, related intangibles and other assets, net 110,163 72,046 Goodwill (c) 2,945 2,945 Prepaid expenses and other assets, net (d) 102,384 60,720 Total deferred charges, goodwill and other assets, net $ 439,864 $ 267,950 2023 and December 31, 2022, respectively, which is included in Accounts payable, accrued expense and other liabilities. See Note 12: Commitments and Contingencies – Office and Ground Lease agreements for further details. contract in exchange for an up-front premium. risk. Fair Value September 30, December 31, 2017 2016 Balance sheet location Asset Derivatives designated as hedging instruments Interest rate swaps $ 3,426 $ 2,847 Deferred charges, goodwill and other assets Liability Derivatives designated as hedging instruments Interest rate swaps $ 1 $ — Accounts payable, accrued expenses and other liabilities Derivatives in Cash Flow Hedging Amount of Gain or Location of Gain or Amount of Gain or Location of Gain or Amount of Gain or Relationships 2017 2016 2017 2016 2017 2016 Three months ended September 30, Interest rate swaps Interest expense Interest and other $ 172 $ 866 $ (558 ) $ (860 ) investment income (loss) $ 6 $ 1,012 Nine months ended September 30, Interest rate swaps Interest expense Interest and other $ (1,322 ) $ (10,128 ) $ (1,926 ) $ (2,600 ) investment income (loss) $ (26 ) $ — : position. September 30, December 31, 2017 2016 Security deposits $ 9,732 $ 8,778 Escrow and other reserve funds 30,741 45,174 Total restricted cash $ 40,473 $ 53,952 : September 30, December 31, Effective 2017 2016 Rate (1) 2.500% Senior Unsecured Notes, due December 15, 2017 $ 250,000 $ 250,000 2.803 % 4.500% Senior Unsecured Notes, due April 18, 2022 300,000 300,000 4.612 % 3.150% Senior Unsecured Notes, due May 15, 2023 275,000 275,000 3.517 % Principal balance outstanding 825,000 825,000 Adjustment for unamortized debt discount (3,708 ) (4,430 ) Unamortized deferred financing costs (2,528 ) (3,215 ) Total senior unsecured notes, net $ 818,764 $ 817,355 Interest Rate - Applicable Basis Points Operating Partnership’s Interest Rate - Above LIBOR for Unsecured Debt Ratings: Applicable Basis Points Alternate Base Rate Facility Fee Higher of S&P or Moody’s Above LIBOR Loans Basis Points No ratings or less than BBB-/Baa3 155.0 55.0 30.0 BBB- or Baa3 (current interest rate based on Company’s election) 120.0 20.0 25.0 BBB or Baa2 100.0 0.0 20.0 BBB+ or Baa1 90.0 0.0 15.0 A- or A3 or higher 87.5 0.0 12.5 Interest Rate - Applicable Basis Points Interest Rate - Above LIBOR for Applicable Basis Alternate Base Rate Facility Fee Total Leverage Ratio Points above LIBOR Loans Basis Points <45% 125.0 25.0 20.0 >45% and <50% (current ratio) 130.0 30.0 25.0 >50% and <55% 135.0 35.0 30.0 >55% 160.0 60.0 35.0 Facility. Operating Partnership’s Interest Rate - Unsecured Debt Ratings: Applicable Basis Points Facility Fee Higher of S&P or Moody’s Above LIBOR Basis Points No ratings or less than BBB-/Baa3 170.0 35.0 BBB- or Baa3 (current through January 2017 amendment) 130.0 30.0 BBB or Baa2 110.0 20.0 BBB+ or Baa1 100.0 15.0 A- or A3 or higher 92.5 12.5 total leverage ratio 2023 Revolving Credit Facility. 2023. Effective September 30, December 31, Property/Project Name Lender Rate (a) 2017 2016 Maturity Curtis Center (b) CCRE & PREFG LIBOR+5.912% — $ 75,000 — 23 Main Street Berkadia CMBS 5.587% $ 27,282 27,838 09/01/18 Port Imperial 4/5 Hotel (c) Fifth Third Bank & Santander LIBOR+4.50% 30,991 14,919 10/06/18 Harborside Plaza 5 The Northwestern Mutual Life Insurance Co. & New York Life Insurance Co. 6.842% 210,381 213,640 11/01/18 Chase II (d) Fifth Third Bank LIBOR+2.25% 46,167 34,708 12/16/18 One River Center (e) Guardian Life Insurance Co. 7.311% 40,668 41,197 02/01/19 Park Square Wells Fargo Bank N.A. LIBOR+1.872% 26,917 27,500 04/10/19 250 Johnson (f) M&T Bank LIBOR+2.35% 22,668 2,440 05/20/19 Portside 5/6 (g) Citizens Bank LIBOR+2.50% 31,987 — 09/19/19 Port Imperial South 11 (h) JPMorgan Chase LIBOR+2.35% 37,827 14,073 11/24/19 Worcester (i) Citizens Bank LIBOR+2.50% 27,798 — 12/10/19 Monaco (j) The Northwestern Mutual Life Insurance Co. 3.15% 170,392 — 02/01/21 Port Imperial South 4/5 Retail American General Life & A/G PC 4.559% 4,000 4,000 12/01/21 The Chase at Overlook Ridge New York Community Bank 3.74% 72,500 72,500 02/01/23 Portside 7 CBRE Capital Markets/FreddieMac 3.569% 58,998 58,998 08/01/23 Alterra I & II Capital One/FreddieMac 3.854% 100,000 — 02/01/24 101 Hudson Wells Fargo CMBS 3.197% 250,000 250,000 10/11/26 Short Hills Portfolio (k) Wells Fargo CMBS 4.15% 124,500 — 04/01/27 150 Main St. Natixis Real Estate Capital LLC 4.48% 41,000 26,642 08/05/27 Port Imperial South 4/5 Garage American General Life & A/G PC 4.853% 32,600 32,600 12/01/29 Principal balance outstanding 1,356,676 896,055 Unamortized deferred financing costs (8,092 ) (7,470 ) Total mortgages, loans payable and other obligations, net $ 1,348,584 $ 888,585 hotels on February 10, 2023. $300 million and provides, subject to certain conditions, a one year extension option with a fee of 25 basis points. The Company entered into an interest-rate cap agreement for the mortgage loan. interest payments at a fixed rate. Interest payments after that period ends are based on LIBOR plus 2.75% annually. Indebtedness $485 million, respectively. 2022. two office properties totaling approximately 0.6 million square feet and several developable land parcels, which are located in Jersey City, Holmdel and Parsippany, New Jersey. The Year Amount October 1 through December 31, 2017 $ 574 2018 2,640 2019 2,646 2020 2,662 2021 2,662 2022 through 2084 225,208 Total $ 236,392 2022. were satisfied. Year Amount October 1 through December 31, 2017 $ 115,835 2018 366,065 2019 331,537 2020 296,093 2021 264,312 2022 and thereafter 1,165,181 Total $ 2,539,023 administrative expenses for the year ended December 31, 2019 were $371 thousand in fees associated with the modifications of the Original Investment Agreement, which were made upon signing of the Add On Investment Agreement. future; 75.46% to VRT in respect of Common Units); and VRT in respect of its Common Units (based on Rockpoint’s $400 million of invested capital at June 30, 2023, this pro rata distribution would be approximately 10.947% to Rockpoint in respect of Preferred Units, 1.325% to VRT in respect of Preferred Units and 87.728% to VRT in respect of Common Units). 2023. that constituted the Put/Call Interests for an aggregate purchase price of $520 million. During the six months ended June 30, 2022, 12,000 Series A Units were redeemed for cash at the stated value. Series A and Total A-1 Preferred Rockpoint Redeemable Units Interests Noncontrolling In MCRLP in RRT Interests Balance January 1, 2017 $ — $ — $ — Redeemable Noncontrolling Interests Issued 52,013 150,000 202,013 Issuance Costs (464 ) (10,563 ) (11,027 ) Net 51,549 139,437 190,986 Income Attributed to Noncontrolling Interests 1,176 4,981 6,157 Distributions (1,176 ) (4,981 ) (6,157 ) Redemption Value Adjustment 775 17,309 18,084 Redeemable noncontrolling interests as of September 30, 2017 $ 52,324 $ 156,746 $ 209,070 ATM Program. PLAN Weighted Aggregate Average Intrinsic Shares Exercise Value Under Options Price $(000’s) Outstanding at January 1, 2017 800,000 $ 17.31 $ 9,368 Granted, Lapsed or Cancelled — — Outstanding at September 30, 2017 ($17.31) 800,000 $ 17.31 $ 5,120 Options exercisable at September 30, 2017 666,666 Available for grant at September 30, 2017 2,069,064 comply with New York Stock Exchange Rule 303A.08. All currently Weighted-Average Grant — Date Shares Fair Value Outstanding at January 1, 2017 145,278 $ 21.76 Granted 59,985 27.00 Vested (95,009 ) 20.73 Cancelled (1,936 ) 25.83 Outstanding at September 30, 2017 108,318 $ 25.49 Plan and as inducement awards. comply with New York Stock Exchange Rule 303A.08. Pursuant to the retirement of a director from the Board of Directors in May 2023, the Company converted 20,767 deferred stock units into shares of common stock. In the calculation of basic and diluted EPS and EPU, a redemption value adjustment of redeemable noncontrolling interests attributable to common shareholders or unitholders is included in the calculation to arrive at the numerator of net income (loss) available to common shareholders or unitholders. Three Months Ended Nine Months Ended September 30, September 30, Computation of Basic EPS 2017 2016 2017 2016 Net income (loss) $ 44,703 $ (9,605 ) $ 28,307 $ 113,530 Add (deduct): Noncontrolling interest in consolidated joint ventures 447 65 865 460 Add (deduct): Noncontrolling interest in Operating Partnership (4,413 ) 999 (2,412 ) (11,947 ) Deduct: Redeemable noncontrolling interest (2,683 ) — (6,157 ) — Deduct: Redemption value adjustment of redeemable noncontrolling interests attributable to common shareholders (2,728 ) — (15,139 ) — Net income (loss) available to common shareholders for basic earnings per share $ 35,326 $ (8,541 ) $ 5,464 $ 102,043 Weighted average common shares 90,023 89,755 89,997 89,739 Basic EPS: Net income (loss) available to common shareholders $ 0.39 $ (0.10 ) $ 0.06 $ 1.14 Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Computation of Diluted EPS Net income (loss) available to common shareholders for basic earnings per share $ 35,326 $ (8,541 ) $ 5,464 $ 102,043 Add (deduct): Noncontrolling interest in Operating Partnership 4,413 (999 ) 2,412 11,947 Deduct: Redemption value adjustment of redeemable noncontrolling interests attributable to the Operating Partnership unitholders (316 ) — (1,748 ) — Net income (loss) for diluted earnings per share $ 39,423 $ (9,540 ) $ 6,128 $ 113,990 Weighted average common shares 100,727 100,253 100,701 100,486 Diluted EPS: Net income (loss) available to common shareholders $ 0.39 $ (0.10 ) $ 0.06 $ 1.13 Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Basic EPS shares 90,023 89,755 89,997 89,739 Add: Operating Partnership — common units 10,439 10,498 10,394 10,502 Restricted Stock Awards 32 — 37 50 Stock Options 233 — 273 195 Diluted EPS Shares 100,727 100,253 100,701 100,486 Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Computation of Basic EPU Net income (loss) $ 44,703 $ (9,605 ) $ 28,307 $ 113,530 Add (deduct): Noncontrolling interest in consolidated joint ventures 447 65 865 460 Deduct: Redeemable noncontrolling interest (2,683 ) — (6,157 ) — Deduct: Redemption value adjustment of redeemable noncontrolling interests (3,044 ) — (16,887 ) — Net income (loss) available to common unitholders for basic earnings per unit $ 39,423 $ (9,540 ) $ 6,128 $ 113,990 Weighted average common units 100,462 100,253 100,391 100,241 Basic EPU: Net income (loss) available to common unitholders $ 0.39 $ (0.10 ) $ 0.06 $ 1.14 Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Computation of Diluted EPU Net income (loss) available to common unitholders for basic earnings per unit $ 39,423 $ (9,540 ) $ 6,128 $ 113,990 Weighted average common unit 100,727 100,253 100,701 100,486 Diluted EPU: Net income (loss) available to common unitholders $ 0.39 $ (0.10 ) $ 0.06 $ 1.13 Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Basic EPU units 100,462 100,253 100,391 100,241 Add: Restricted Stock Awards 32 — 37 50 Stock Options 233 — 273 195 Diluted EPU Units 100,727 100,253 100,701 100,486 2022. Nine Months Ended September 30, 2017 2016 Balance at January 1 $ 199,516 $ 228,032 Net income (loss) 7,704 11,487 Issuance of limited partner common units 2,793 — Unit distributions (6,295 ) (4,947 ) Redeemable noncontrolling interest (7,905 ) — Decrease in noncontrolling interests in consolidated joint ventures (1,082 ) (35,544 ) Redemption of common units for common stock (2,531 ) (308 ) Stock compensation 3,302 1,511 Other comprehensive income (loss) 63 (789 ) Rebalancing of ownership percentage between parent and subsidiaries (3,757 ) (865 ) Balance at September 30 $ 191,808 $ 198,577 2023. Common LTIP Units Units Balance at January 1, 2017 10,488,105 657,373 Redemption of common units for shares of common stock (148,662 ) — Issuance of units 99,412 578,323 Cancellation of units — (4,819 ) Balance at September 30, 2017 10,438,855 1,230,877 federal income tax purposes. The AO LTIP Units were cancelled and forfeited in March 2023 as they did not vest. services). All properties classified as discontinued operations have been excluded. Real Estate Commercial Multi-family Corporate Total & Other Multi-family Services & Other (d) Company Total revenues: Three months ended: September 30, 2017 $ 135,301 $ 18,078 $ 9,353 (e) $ (2,714 ) $ 160,018 September 30, 2016 141,226 8,806 9,842 (f) (2,357 ) 157,517 Nine months ended: September 30, 2017 407,833 45,772 28,088 (e) (9,022 ) 472,671 September 30, 2016 411,947 27,011 27,990 (f) (7,281 ) 459,667 Total operating and interest expenses (a): Three months ended: September 30, 2017 $ 61,114 $ 8,277 $ 10,180 (g) $ 23,740 $ 103,311 September 30, 2016 68,533 5,005 9,633 (h) 21,269 104,440 Nine months ended: September 30, 2017 184,284 22,388 29,775 (g) 66,047 302,494 September 30, 2016 201,914 16,337 29,879 (h) 65,789 313,919 Equity in earnings (loss) of unconsolidated joint ventures: Three months ended: September 30, 2017 $ 1,058 $ (3,029 ) $ 438 $ — $ (1,533 ) September 30, 2016 22,487 (1,442 ) 745 — 21,790 Nine months ended: September 30, 2017 1,452 (7,797 ) 1,463 — (4,882 ) September 30, 2016 23,569 (4,773 ) 826 — 19,622 Net operating income (loss) (b): Three months ended: September 30, 2017 $ 75,245 $ 6,772 $ (389 ) $ (26,454 ) $ 55,174 September 30, 2016 95,180 2,359 954 (23,626 ) 74,867 Nine months ended: September 30, 2017 225,001 15,587 (224 ) (75,069 ) 165,295 September 30, 2016 233,602 5,901 (1,063 ) (73,070 ) 165,370 Total assets: September 30, 2017 $ 3,125,158 $ 1,680,525 $ 14,297 $ 175,539 $ 4,995,519 December 31, 2016 3,344,396 887,394 17,207 47,769 4,296,766 Total long-lived assets (c): September 30, 2017 $ 2,787,190 $ 1,399,901 $ 5,229 $ (9,001 ) $ 4,183,319 December 31, 2016 2,999,820 618,038 4,609 (5,933 ) 3,616,534 Total investments in unconsolidated joint ventures: September 30, 2017 $ 14,644 $ 222,816 $ 812 $ 168 $ 238,440 December 31, 2016 81,549 237,493 1,005 — 320,047 Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Net operating income $ 55,174 $ 74,867 $ 165,295 $ 165,370 Add (deduct): Depreciation and amortization (52,375 ) (48,117 ) (157,768 ) (134,639 ) Gain on change of control of interests — — — 15,347 Realized gains (losses) and unrealized losses on disposition of rental property, net 31,336 (17,053 ) (2,112 ) 68,664 Gain on sale of investment in unconsolidated joint venture 10,568 — 23,131 5,670 Gain (loss) from extinguishment of debt, net — (19,302 ) (239 ) (6,882 ) Net income (loss) 44,703 (9,605 ) 28,307 113,530 Noncontrolling interest in consolidated joint ventures 447 65 865 460 Noncontrolling interest in Operating Partnership (4,413 ) 999 (2,412 ) (11,947 ) Redeemable noncontrolling interest (2,683 ) — (6,157 ) — Net income (loss) available to common shareholders $ 38,054 $ (8,541 ) $ 20,603 $ 102,043 Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Net operating income $ 55,174 $ 74,867 $ 165,295 $ 165,370 Add (deduct): Depreciation and amortization (52,375 ) (48,117 ) (157,768 ) (134,639 ) Gain on change of control of interests — — — 15,347 Realized gains (losses) and unrealized losses on disposition of rental property, net 31,336 (17,053 ) (2,112 ) 68,664 Gain on sale of investment in unconsolidated joint venture 10,568 — 23,131 5,670 Gain (loss) from extinguishment of debt, net — (19,302 ) (239 ) (6,882 ) Net income (loss) 44,703 (9,605 ) 28,307 113,530 Noncontrolling interest in consolidated joint ventures 447 65 865 460 Redeemable noncontrolling interest (2,683 ) — (6,157 ) — Net income (loss) available to common unitholders $ 42,467 $ (9,540 ) $ 23,015 $ 113,990 : Acquisition # of Rentable Acquisition Date Property Address Location Bldgs. Square Feet Cost 01/11/17 Red Bank portfolio (a) Red Bank, New Jersey 3 279,472 $ 27,228 03/06/17 Short Hills/Madison portfolio (b) Short Hills & Madison, New Jersey 6 1,113,028 367,361 Total Acquisitions 9 1,392,500 $ 394,589 Realized Gains Rentable Net Net (losses)/ Disposition # of Square Sales Carrying Unrealized Date Property/Address Location Bldgs. Feet Proceeds Value Losses, net 01/30/17 Cranford portfolio Cranford, New Jersey 6 435,976 $ 26,598 $ 22,736 $ 3,862 01/31/17 440 Route 22 East (a) Bridgewater, New Jersey 1 198,376 10,074 10,069 5 02/07/17 3 Independence Way Princeton, New Jersey 1 111,300 11,549 9,910 1,639 05/15/17 103 Carnegie Center Princeton, New Jersey 1 96,000 15,063 (b) 8,271 6,792 08/29/17 400 Chestnut Ridge Road Woodcliff Lake, New Jersey 1 89,200 6,891 7,498 (607 ) 08/30/17 140 E. Ridgewood Avenue Paramus, New Jersey 1 239,680 30,201 30,737 (536 ) 08/30/17 Bergen portfolio Woodcliff Lake, Paramus and 5 1,061,544 86,973 (c) 135,121 (48,148 ) Rochelle Park, New Jersey 09/11/17 377 Summerhill Road East Brunswick, New Jersey 1 40,000 3,221 2,172 1,049 09/13/17 700 Executive Boulevard Elmsford, New York — — (d) 5,717 970 4,747 09/20/17 Totowa Portfolio Totowa, New Jersey 13 499,243 63,624 27,630 35,994 09/27/17 890 Mountain Avenue (e) New Providence, New Jersey 1 80,000 4,852 6,139 (1,287 ) 09/28/17 135 Chestnut Ridge Road Montvale, New Jersey 1 66,150 5,844 (f) 2,929 2,915 09/29/17 Moorestown portfolio Moorestown and Burlington, New Jersey 26 1,260,398 73,393 (g) 56,186 17,207 Sub-total 58 4,177,867 344,000 320,368 23,632 Unrealized losses on rental property held for sale (25,744 ) Totals 58 4,177,867 $ 344,000 $ 320,368 $ (2,112 ) Information. statements. 2023. Three Months Ended September 30, Dollar Percent (dollars in thousands) 2017 2016 Change Change Revenue from rental operations and other: Base rents $ 128,643 $ 129,523 $ (880 ) (0.7 )% Escalations and recoveries from tenants 16,385 16,177 208 1.3 Parking income 5,766 3,443 2,323 67.5 Other income 3,476 1,724 1,752 101.6 Total revenues from rental operations 154,270 150,867 3,403 2.3 Property expenses: Real estate taxes 21,300 20,606 694 3.4 Utilities 11,480 14,127 (2,647 ) (18.7 ) Operating services 26,312 25,553 759 3.0 Total property expenses 59,092 60,286 (1,194 ) (2.0 ) Non-property revenues: Real estate services 5,748 6,650 (902 ) (13.6 ) Total non-property revenues 5,748 6,650 (902 ) (13.6 ) Non-property expenses: Real estate services expenses 6,207 6,361 (154 ) (2.4 ) General and administrative 13,140 14,007 (867 ) (6.2 ) Acquisition-related costs — 815 (815 ) (100.0 ) Depreciation and amortization 52,375 48,117 4,258 8.8 Total non-property expenses 71,722 69,300 2,422 3.5 Operating income 29,204 27,931 1,273 4.6 Other (expense) income: Interest expense (25,634 ) (24,233 ) (1,401 ) (5.8 ) Interest and other investment income (loss) 762 1,262 (500 ) (39.6 ) Equity in earnings (loss) of unconsolidated joint ventures (1,533 ) 21,790 (23,323 ) (107.0 ) Realized gains (losses) and unrealized losses on disposition of rental property, net 31,336 (17,053 ) 48,389 283.8 Gain on sale of investment in unconsolidated joint venture 10,568 — 10,568 — Gain (loss) from extinguishment of debt, net — (19,302 ) 19,302 100.0 Total other (expense) income 15,499 (37,536 ) 53,035 141.3 Net income (loss) $ 44,703 $ (9,605 ) $ 54,308 565.4 % 2022 Total Same-Store Acquired Properties Company Properties Properties Sold in 2016 and 2017 Dollar Percent Dollar Percent Dollar Percent Dollar Percent (dollars in thousands) Change Change Change Change Change Change Change Change Revenue from rental operations and other: Base rents $ (880 ) (0.7 )% $ 51 — % $ 19,018 14.7 % $ (19,949 ) (15.4 )% Escalations and recoveries from tenants 208 1.3 1,333 8.3 939 5.8 (2,064 ) (12.8 ) Parking income 2,323 67.5 1,638 47.6 718 20.9 (33 ) (1.0 ) Other income 1,752 101.6 (1,075 ) (62.4 ) 2,780 161.3 47 2.7 Total $ 3,403 2.3 % $ 1,947 1.4 % $ 23,455 15.5 % $ (21,999 ) (14.6 )% Property expenses: Real estate taxes $ 694 3.4 % $ 1,260 6.2 % $ 2,314 11.2 % $ (2,880 ) (14.0 )% Utilities (2,647 ) (18.7 ) (394 ) (2.8 ) 915 6.5 (3,168 ) (22.4 ) Operating services 759 3.0 89 0.4 4,517 17.7 (3,847 ) (15.1 ) Total $ (1,194 ) (2.0 )% $ 955 1.6 % $ 7,746 12.8 % $ (9,895 ) (16.4 )% OTHER DATA: Number of Consolidated Properties 147 132 15 93 Commercial Square feet (in thousands) 17,866 15,892 1,974 8,583 Multi-family portfolio (number of units) 2,551 1,628 923 — multifamily rental properties. 2023 as compared to 2022. remained relatively unchanged. tax rates primarily related to properties located in Jersey City, New Jersey. increased usage. remained relatively unchanged. services. 2022 and cost reductions in 2023. developable land parcels. See Note 11: Disclosure of Fair Value of Assets and Liabilities. the banks. Nine Months Ended September 30, Dollar Percent (dollars in thousands) 2017 2016 Change Change Revenue from rental operations and other: Base rents $ 382,915 $ 380,133 $ 2,782 0.7 % Escalations and recoveries from tenants 47,455 45,248 2,207 4.9 Parking income 15,047 10,131 4,916 48.5 Other income 9,274 4,224 5,050 119.6 Total revenues from rental operations 454,691 439,736 14,955 3.4 Property expenses: Real estate taxes 63,609 66,250 (2,641 ) (4.0 ) Utilities 33,251 38,658 (5,407 ) (14.0 ) Operating services 80,495 76,309 4,186 5.5 Total property expenses 177,355 181,217 (3,862 ) (2.1 ) Non-property revenues: Real estate services 17,980 19,931 (1,951 ) (9.8 ) Total non-property revenues 17,980 19,931 (1,951 ) (9.8 ) Non-property expenses: Real estate services expenses 18,376 19,418 (1,042 ) (5.4 ) General and administrative 37,223 39,011 (1,788 ) (4.6 ) Acquisition-related costs — 2,854 (2,854 ) (100.0 ) Depreciation and amortization 157,768 134,639 23,129 17.2 Total non-property expenses 213,367 195,922 17,445 8.9 Operating income 81,949 82,528 (579 ) (0.7 ) Other (expense) income: Interest expense (70,898 ) (72,158 ) 1,260 1.7 Interest and other investment income 1,358 739 619 83.8 Equity in earnings (loss) of unconsolidated joint ventures (4,882 ) 19,622 (24,504 ) (124.9 ) Gain on change of control of interests — 15,347 (15,347 ) (100.0 ) Realized gains (losses) and unrealized losses on disposition of rental property, net (2,112 ) 68,664 (70,776 ) (103.1 ) Gain on sale of investment in unconsolidated joint venture 23,131 5,670 17,461 308.0 Gain (loss) from extinguishment of debt, net (239 ) (6,882 ) 6,643 96.5 Total other (expense) income (53,642 ) 31,002 (84,644 ) (273.0 ) Net income (loss) $ 28,307 $ 113,530 $ (85,223 ) (75.1 )% 2022 Total Same-Store Acquired Properties Company Properties Properties Sold in 2016 and 2017 Dollar Percent Dollar Percent Dollar Percent Dollar Percent (dollars in thousands) Change Change Change Change Change Change Change Change Revenue from rental operations and other: Base rents $ 2,782 0.7 % $ 7,493 1.9 % $ 58,538 15.4 % $ (63,249 ) (16.6 )% Escalations and recoveries from tenants 2,207 4.9 3,650 8.1 4,710 10.4 (6,153 ) (13.6 ) Parking income 4,916 48.5 3,333 32.9 1,752 17.3 (169 ) (1.7 ) Other income 5,050 119.6 (1,119 ) (26.4 ) 6,125 145.0 44 1.0 Total $ 14,955 3.4 % $ 13,357 3.0 % $ 71,125 16.2 % $ (69,527 ) (15.8 )% Property expenses: Real estate taxes $ (2,641 ) (4.0 )% $ 2,196 3.3 % $ 7,096 10.7 % $ (11,933 ) (18.0 )% Utilities (5,407 ) (14.0 ) (569 ) (1.5 ) 3,541 9.2 (8,379 ) (21.7 ) Operating services 4,186 5.5 5,132 6.7 13,193 17.3 (14,139 ) (18.5 ) Total $ (3,862 ) (2.1 )% $ 6,759 3.8 % $ 23,830 13.1 % $ (34,451 ) (19.0 )% OTHER DATA: Number of Consolidated Properties 147 129 18 93 Commercial Square feet (in thousands) 17,866 15,629 2,237 8,583 Multi-family portfolio (number of units) 2,551 1,081 1,470 — costs. services. cost reductions in 2023. sales proceeds deposits. rental rates. Rockpoint. from borrowings under the revolving credit facility. Debt Balance Weighted Average Weighted Average ($000’s) % of Total Interest Rate (a) Maturity in Years Fixed Rate Unsecured Debt and Other Obligations $ 1,500,000 52.51 % 3.48 % 2.77 Fixed Rate Secured Debt 1,132,320 39.64 % 4.39 % 5.74 Variable Rate Secured Debt 224,357 7.85 % 3.37 % 1.38 Totals/Weighted Average: $ 2,856,677 100.00 % 3.87 % (b) 3.86 Adjustment for unamortized debt discount (3,708 ) Unamortized deferred financing costs (13,783 ) Total Debt, Net $ 2,839,186 $548 million. Scheduled Principal Weighted Avg. Amortization Maturities Total Effective Interest Rate of Period ($000’s) ($000’s) ($000’s) Future Repayments (a) 2017 $ 1,849 $ 250,000 $ 251,849 2.83 % 2018 6,977 308,695 315,672 6.12 % 2019 1,912 534,566 536,478 3.55 % 2020 1,977 325,000 326,977 3.31 % 2021 2,051 168,800 170,851 3.19 % Thereafter 6,811 1,242,647 1,249,458 3.89 % Sub-total 21,577 2,829,708 2,851,285 3.87 Adjustment for unamortized debt discount/premium, net as of September 30, 2017 (3,708 ) — (3,708 ) Unamortized mark-to-market 5,392 — 5,392 Unamortized deferred financing costs (13,783 ) — (13,783 ) Totals/Weighted Average $ 9,478 $ 2,829,708 $ 2,839,186 3.87 %(b) Interest Rate - Applicable Basis Points Operating Partnership’s Interest Rate - Above LIBOR for Unsecured Debt Ratings: Applicable Basis Points Alternate Base Rate Facility Fee Higher of S&P or Moody’s Above LIBOR Loans Basis Points No ratings or less than BBB-/Baa3 155.0 55.0 30.0 BBB- or Baa3 (current interest rate based on Company’s election) 120.0 20.0 25.0 BBB or Baa2 100.0 0.0 20.0 BBB+ or Baa1 90.0 0.0 15.0 A- or A3 or higher 87.5 0.0 12.5 Interest Rate - Applicable Basis Points Interest Rate - Above LIBOR for Applicable Basis Alternate Base Rate Facility Fee Total Leverage Ratio Points above LIBOR Loans Basis Points <45% 125.0 25.0 20.0 >45% and <50% (current ratio) 130.0 30.0 25.0 >50% and <55% 135.0 35.0 30.0 >55% 160.0 60.0 35.0 Facility. Interest Rate - Applicable Basis Points Operating Partnership’s Interest Rate - Above LIBOR for Unsecured Debt Ratings: Applicable Basis Points Alternate Base Rate Higher of S&P or Moody’s Above LIBOR Loans No ratings or less than BBB-/Baa3 185.0 85.0 BBB- or Baa3 (current interest rate based on Company’s election) 140.0 40.0 BBB or Baa2 115.0 15.0 BBB+ or Baa1 100.0 0.0 A- or A3 or higher 90.0 0.0 Interest Rate - Applicable Basis Points Interest Rate - Above LIBOR for Applicable Basis Alternate Base Rate Total Leverage Ratio Points above LIBOR Loans <45% 145.0 45.0 >45% and <50% (current ratio) 155.0 55.0 >50% and <55% 165.0 65.0 >55% 195.0 95.0 Operating Partnership’s Interest Rate - Unsecured Debt Ratings: Applicable Basis Points Facility Fee Higher of S&P or Moody’s Above LIBOR Basis Points No ratings or less than BBB-/Baa3 170.0 35.0 BBB- or Baa3 (current through January 2017 amendment) 130.0 30.0 BBB or Baa2 110.0 20.0 BBB+ or Baa1 100.0 15.0 A- or A3 or higher 92.5 12.5 2023 Revolving Credit Facility. Common Common Stock Units Total Outstanding at January 1, 2017 89,696,713 10,488,105 100,184,818 Common units redeemed for common stock 148,661 (148,662 ) (1 ) Shares issued under Dividend Reinvestment and Stock Purchase Plan 2,276 — 2,276 Restricted shares and common units issued 69,736 99,412 169,148 Cancellation of restricted shares (3,810 ) — (3,810 ) Outstanding at September 30, 2017 89,913,576 10,438,855 100,352,431 July 24, 2023. July 24, 2023. Payments Due by Period Less than 1 2 – 3 4 – 5 6 – 10 After 10 (dollars in thousands) Total Year Years Years Years Years Senior unsecured notes $ 947,600 $ 275,288 $ 44,325 $ 344,325 $ 283,662 — Unsecured revolving credit facility and term loans (a) 713,830 21,700 692,130 — — — Mortgages, loans payable and other obligations (b) 1,449,825 83,950 514,697 225,125 594,607 $ 31,446 Payments in lieu of taxes (PILOT) 33,160 7,743 15,516 9,364 537 — Ground lease payments 236,392 2,554 5,302 5,324 13,073 210,139 Other 1,655 — 1,655 — — — Total $ 3,382,462 $ 391,235 $ 1,273,625 $ 584,138 $ 891,879 $ 241,585 Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Net income (loss) available to common shareholders $ 38,054 $ (8,541 ) $ 20,603 $ 102,043 Add (deduct): Noncontrolling interests in Operating Partnership 4,413 (999 ) 2,412 11,947 Real estate-related depreciation and amortization on continuing operations (a) 57,231 52,371 172,144 147,872 Gain on sale of investment in unconsolidated joint venture (10,568 ) — (23,131 ) (5,670 ) Gain on change of control of interests — — — (15,347 ) Realized (gains) losses and unrealized losses on disposition of rental property, net (31,336 ) 17,053 2,112 (68,664 ) Funds from operations available to common stock and Operating Partnership unitholders $ 57,794 $ 59,884 $ 174,140 $ 172,181 three months 2022 included $3.9 million of land impairment charges and $55.1 million, respectively, gains on disposition of developable land, which are included in the calculation to arrive at funds from operations as such gains relate to non-depreciable assets. pursue acquisition and development opportunities and refinance existing debt and our future interest expense; The Company manages its exposure to interest rate risk by utilizing fixed rate indebtedness or by hedging the majority of its floating rate indebtedness with interest rate swaps or caps, as appropriate. September 30, 2017 Debt, including current portion 10/1/2017 - Fair ($s in thousands) 12/31/2017 2018 2019 2020 2021 Thereafter Sub-total Other (a) Total Value Fixed Rate $ 251,499 $ 237,113 $ 391,031 $ 326,977 $ 170,851 $ 1,249,458 $ 2,626,929 $ (9,092 ) $ 2,617,837 $ 2,604,465 Average Interest Rate 2.83 % 6.70 % 3.56 % 3.31 % 3.19 % 3.89 % 3.87 % Variable Rate $ 350 $ 78,559 $ 145,447 $ — $ — $ — $ 224,356 $ (3,007 ) $ 221,349 $ 221,351 2023. including its ability to pay its debt obligations. 31.2* 31.3* 31.4* 32.2* 101.1* The following financial statements from * filed herewith Date: By: its General Partner Date: By: Date: By:Title of each class Trading Symbol(s) Name of each exchange on which registered Common Stock, par value $0.01 per share VRE New York Stock Exchange Mack-Cali Realty CorporationYES x NO oMack-Cali Realty,Veris Residential, Inc.Veris Residential, L.P. YES x NO oand posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).Mack-Cali Realty CorporationYES x NO oMack-Cali Realty,Veris Residential, Inc.Veris Residential, L.P. YES x NO oor a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”filer,” “smaller reporting company” and “smaller reporting“emerging growth company” in Rule 12b-2 of the Exchange Act.Mack-Cali Realty Corporation:x☒¨☐¨☐Emerging Growth Company ☐ Smaller reporting company ¨☐Emerging Growth Company ¨☐(Do not check if a smaller reporting company)Mack-Cali Realty, L.P.:Large accelerated filer xAccelerated filer ¨Non-accelerated filer ¨Smaller reporting company ¨Emerging Growth Company ¨(Do not check if a smaller reporting company)Mack-Cali Realty Corporation¨Mack-Cali Realty, L.P.¨Mack-Cali Realty CorporationYES ¨ NO xMack-Cali Realty,Veris Residential, Inc.Veris Residential, L.P. YES ¨ NO xNovember 3, 2017,July 24, 2023, there were 89,914,07992,064,713 shares of Mack-Cali Realty Corporation’sVeris Residential, Inc.’s Common Stock, par value $0.01 per share, outstanding.Mack-Cali Realty,SeptemberJune 30, 20172023 of Mack-Cali Realty CorporationVeris Residential, Inc. and Mack-Cali Realty,Veris Residential, L.P. Unless stated otherwise or the context otherwise requires, references to the “Operating Partnership” mean Mack-Cali Realty,Veris Residential, L.P., a Delaware limited partnership, and references to the “General Partner” mean Mack-Cali Realty Corporation,Veris Residential, Inc., a Maryland corporation and real estate investment trust (“REIT”), and its subsidiaries, including the Operating Partnership. References to the “Company,” “we,” “us” and “our” mean collectively the General Partner, the Operating Partnership and those entities/subsidiaries consolidated by the General Partner. management, acquisition, development construction and tenant-related services for its General Partner. The Operating Partnership, through its operating divisions and subsidiaries, including the Mack-CaliVeris property-owning partnerships and limited liability companies is the entity through which all of the General Partner’s operations are conducted. The General Partner is the sole general partner of the Operating Partnership and has exclusive control of the Operating Partnership’s day-to-day management.SeptemberJune 30, 2017,2023, the General Partner owned an approximate 89.691.2 percent common unit interest in the Operating Partnership. The remaining approximate 10.48.8 percent common unit interest is owned by limited partners. The limited partners of the Operating Partnership are (1) persons who contributed their interests in properties to the Operating Partnership in exchange for common units (each, a “Common Unit”) or preferred units of limited partnership interest in the Operating Partnership or (2) recipients of long termlong-term incentive plan units of the Operating Partnership pursuant to the General Partner’s executive compensation plans.issuance.issuance. The redemption is required to be satisfied in shares of Common Stock of the General Partner, cash, or a combination thereof, calculated as follows: one share of the General Partner’s Common Stock, or cash equal to the fair market value of a share of the General Partner’s Common Stock at the time of redemption, for each Common Unit. The General Partner, in its sole discretion, determines the form of redemption of Common Units (i.e., whether a common unitholder receives Common Stock of the General Partner, cash, or any combination thereof). If the General Partner elects to satisfy the redemption with shares of Common Stock of the General Partner as opposed to cash, the General Partner is obligated to issue shares of its Common Stock to the redeeming unitholder. Regardless of the rights described above, the common unitholders may not put their units for cash to the Company or the General Partner under any circumstances. With each such redemption, the General Partner’s percentage ownership in the Operating Partnership will increase. In addition, whenever the General Partner issues shares of its Common Stock other than to acquire Common Units, the General Partner must contribute any net proceeds it receives to the Operating Partnership and the Operating Partnership must issue to the General Partner an equivalent number of Common Units. This structure is commonly referred to as an umbrella partnership REIT, or UPREIT.···other significant assets, liabilities or operations, other than its interests in the Operating Partnership, nor does the Operating Partnership have employees of its own. The Operating Partnership, not the General Partner, generally executes allunsecured revolving credit facility, and unsecured term loan facilities, the issuance of secured and unsecured debt and equity securities, and proceeds received from the disposition of properties and joint ventures.·the General PartnerVeris Residential, Inc. and the Operating Partnership:·Veris Residential, L.P.:··Mack-Cali Realty Corporation’sVeris Residential, Inc.’s Stockholders’ Equity and Mack-Cali Realty,Veris Residential, L.P.’s Partners’ Capital;···MACK-CALI REALTY CORPORATIONMACK-CALI REALTY,PagePage 510Mack-Cali Realty, L.P.1112131415Mack-Cali Realty Corporation and Mack-Cali Realty, L.P.167676Mack-Cali Realty Corporation and Mack-Cali Realty, L.P.787878787878787992MACK-CALI REALTY,Mack-Cali Realty Corporation’sVeris Residential, Inc.’s and Mack-Cali Realty,Veris Residential, L.P.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016.nine-monthsix month periods ended SeptemberJune 30, 20172023 are not necessarily indicative of the results to be expected for the entire fiscal year or any other period.MACK-CALI REALTY CORPORATION (in(in thousands, except per share amounts) (unaudited)ASSETS June 30,
2023December 31,
2022Rental property Land and leasehold interests $ 483,195 $ 492,204 Buildings and improvements 2,845,193 3,332,315 Tenant improvements 40,809 122,509 Furniture, fixtures and equipment 100,803 99,094 3,470,000 4,046,122 Less – accumulated depreciation and amortization (438,113) (631,910) 3,031,887 3,414,212 Real estate held for sale, net 122,690 193,933 Net investment in rental property 3,154,577 3,608,145 Cash and cash equivalents 396,940 26,782 Restricted cash 27,614 20,867 Investments in unconsolidated joint ventures 122,435 126,158 Unbilled rents receivable, net 7,808 39,734 Deferred charges and other assets, net 58,961 96,162 Accounts receivable 4,498 2,920 Total assets $ 3,772,833 $ 3,920,768 LIABILITIES AND EQUITY Mortgages, loans payable and other obligations, net $ 1,820,981 $ 1,903,977 Mandatorily redeemable noncontrolling interests 487,619 — Dividends and distributions payable 72 110 Accounts payable, accrued expenses and other liabilities 53,239 72,041 Rents received in advance and security deposits 15,710 22,941 Accrued interest payable 6,963 7,131 Total liabilities 2,384,584 2,006,200 Commitments and contingencies Redeemable noncontrolling interests 40,231 515,231 Equity: Veris Residential, Inc. stockholders’ equity: Common stock, $0.01 par value, 190,000,000 shares authorized, 92,041,386 and 91,141,649 shares outstanding 918 911 Additional paid-in capital 2,540,309 2,532,182 Dividends in excess of net earnings (1,348,792) (1,301,385) Accumulated other comprehensive income 4,518 3,977 Total Veris Residential, Inc. stockholders’ equity 1,196,953 1,235,685 Noncontrolling interests in subsidiaries: Operating Partnership 115,307 126,109 Consolidated joint ventures 35,758 37,543 Total noncontrolling interests in subsidiaries 151,065 163,652 Total equity 1,348,018 1,399,337 Total liabilities and equity $ 3,772,833 $ 3,920,768 MACK-CALI REALTY CORPORATION (in(in thousands, except per share amounts) (unaudited)
The accompanying notes are an integral part of these consolidated financial statements.Three Months Ended
June 30,Six Months Ended
June 30,REVENUES 2023 2022 2023 2022 Revenue from leases $ 61,909 $ 47,313 $ 121,747 $ 91,256 Real estate services 643 896 1,554 1,807 Parking income 4,796 4,173 9,129 7,760 Other income 1,381 1,431 3,258 2,491 Total revenues 68,729 53,813 135,688 103,314 EXPENSES Real estate taxes 7,860 7,911 18,980 16,201 Utilities 2,379 1,895 4,882 4,247 Operating services 14,044 13,100 26,307 25,964 Real estate services expenses 4,389 2,920 6,332 5,283 General and administrative 9,582 11,527 19,865 30,976 Transaction related costs 3,319 1,345 4,347 1,345 Depreciation and amortization 23,684 21,015 47,331 39,456 Land and other impairments, net — 3,900 3,396 6,832 Total expenses 65,257 63,613 131,440 130,304 OTHER (EXPENSE) INCOME Interest expense (21,692) (14,741) (43,706) (26,348) Interest cost of mandatorily redeemable noncontrolling interests (13,390) — (13,390) — Interest and other investment income 3,927 189 4,043 347 Equity in earnings of unconsolidated joint ventures 2,700 2,638 2,633 2,151 Gain (loss) on disposition of developable land — 55,125 (22) 57,748 Loss from extinguishment of debt, net (2,657) (129) (2,657) (129) Other income, net 853 — 2,851 — Total other (expense) income, net (30,259) 43,082 (50,248) 33,769 (Loss) income from continuing operations (26,787) 33,282 (46,000) 6,779 Discontinued operations: (Loss) income from discontinued operations 140 5,808 2,344 25,948 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net (3,488) (4,440) (2,709) (2,604) Total discontinued operations, net (3,348) 1,368 (365) 23,344 Net (loss) income (30,135) 34,650 (46,365) 30,123 Noncontrolling interests in consolidated joint ventures 636 784 1,223 1,758 Noncontrolling interests in Operating Partnership of income from continuing operations 2,384 (2,568) 4,696 305 Noncontrolling interests in Operating Partnership in discontinued operations 298 (127) 22 (2,102) Redeemable noncontrolling interests (617) (6,366) (6,983) (12,803) Net (loss) income available to common shareholders $ (27,434) $ 26,373 $ (47,407) $ 17,281 Basic earnings per common share: (Loss) income from continuing operations $ (0.27) $ 0.24 $ (0.56) $ (0.11) Discontinued operations (0.03) 0.01 0.00 0.23 Net (loss) income available to common shareholders $ (0.30) $ 0.25 $ (0.56) $ 0.12 Diluted earnings per common share: (Loss) income from continuing operations $ (0.27) $ 0.24 $ (0.56) $ (0.11) Discontinued operations (0.03) 0.01 0.00 0.23 Net (loss) income available to common shareholders $ (0.30) $ 0.25 $ (0.56) $ 0.12 Basic weighted average shares outstanding 91,873 91,027 91,551 90,989 Diluted weighted average shares outstanding 100,854 100,352 100,691 100,171 MACK-CALI REALTY CORPORATIONThree Months Ended
June 30,Six Months Ended
June 30,2023 2022 2023 2022 Net (loss) income $ (30,135) $ 34,650 $ (46,365) $ 30,123 Other comprehensive income (loss): Net unrealized gain (loss) on derivative instruments for interest rate swaps 1,536 (60) 591 2,122 Comprehensive (loss) income $ (28,599) $ 34,590 $ (45,774) $ 32,245 Comprehensive loss attributable to noncontrolling interests in consolidated joint ventures 636 784 1,223 1,758 Comprehensive income attributable to redeemable noncontrolling interests (617) (6,366) (6,983) (12,803) Comprehensive loss (income) attributable to noncontrolling interests in Operating Partnership 2,545 (2,689) 4,668 (1,987) Comprehensive (loss) income attributable to common shareholders $ (26,035) $ 26,319 $ (46,866) $ 19,213 MACK-CALI REALTY CORPORATIONSTATEMENTSTATEMENTS OF CHANGES IN EQUITY(in (in thousands) (unaudited) Common Stock Additional
Paid-In
CapitalDividends in
Excess of
Net EarningsAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interests
in SubsidiariesTotal Equity For the Three Months Ended June 30, 2023 Shares Par Value Balance at April 1, 2023 91,620 915 $ 2,533,854 $ (1,321,358) $ 3,119 $ 157,439 $ 1,373,969 Net loss — — — (27,434) — (2,701) (30,135) Redeemable noncontrolling interests — — — — — (617) (617) Redemption of common units for common stock 271 3 4,189 — — (4,192) — Redemption of common units — — — — — (78) (78) Shares issued under Dividend Reinvestment and Stock Purchase Plan — — 1 — — — 1 Directors' deferred compensation plan 21 — 86 — — — 86 Stock compensation 144 — 3,381 — — 94 3,475 Cancellation of restricted shares (15) — (219) — — — (219) Other comprehensive income — — — — 1,399 137 1,536 Rebalancing of ownership percentage between parent and subsidiaries — — (983) — — 983 — Balance at June 30, 2023 92,041 918 $ 2,540,309 $ (1,348,792) $ 4,518 $ 151,065 $ 1,348,018 Common Stock Additional
Paid-In
CapitalDividends in
Excess of
Net EarningsAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interests
in SubsidiariesTotal Equity For the Three Months Ended June 30, 2022 Shares Par Value Balance at April 1, 2022 90,956 909 $ 2,531,188 $ (1,258,411) $ 1,995 $ 165,120 $ 1,440,801 Net income — — — 26,373 — 8,277 34,650 Redeemable noncontrolling interests — — (3,524) — — (6,726) (10,250) Change in noncontrolling interests in consolidated joint ventures — — — — — 7 7 Redemption of common units for common stock 11 — 161 — — (161) — Redemption of common units — — — — — (359) (359) Shares issued under Dividend Reinvestment and Stock Purchase Plan 1 — 16 — — — 16 Directors' deferred compensation plan — — 110 — — — 110 Stock compensation 136 2 2,507 — — 445 2,954 Cancellation of common stock (41) — (696) — — — (696) Other comprehensive loss — — — — (54) (6) (60) Rebalancing of ownership percentage between parent and subsidiaries — — (4,296) — — 4,296 — Balance at June 30, 2022 91,063 911 $ 2,525,466 $ (1,232,038) $ 1,941 $ 170,893 $ 1,467,173 MACK-CALI REALTY CORPORATIONCASH FLOWSCHANGES IN EQUITY (in thousands) (unaudited)Common Stock Additional
Paid-In
CapitalDividends in
Excess of
Net EarningsAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interests
in SubsidiariesTotal Equity For the Six Months Ended June 30, 2023 Shares Par Value Balance at January 1, 2023 91,142 911 $ 2,532,182 $ (1,301,385) $ 3,977 $ 163,652 $ 1,399,337 Net (loss) income — — — (47,407) — 1,042 (46,365) Redeemable noncontrolling interests — — (4,516) — — (7,444) (11,960) Change in noncontrolling interests in consolidated joint ventures — — — — — (562) (562) Redemption of common units for common stock 650 7 9,044 — — (9,051) — Redemption of common units — — — — — (94) (94) Shares issued under Dividend Reinvestment and Stock Purchase Plan — — 2 — — — 2 Directors' deferred compensation plan 21 — 196 — — — 196 Stock compensation 259 — 6,852 — — 487 7,339 Cancellation of restricted shares (31) — (466) — — — (466) Other comprehensive income — — — — 541 50 591 Rebalancing of ownership percentage between parent and subsidiaries — — (2,985) — — 2,985 — Balance at June 30, 2023 92,041 918 $ 2,540,309 $ (1,348,792) $ 4,518 $ 151,065 $ 1,348,018 Common Stock Additional
Paid-In
CapitalDividends in
Excess of
Net EarningsAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interests
in SubsidiariesTotal Equity For the Six Months Ended June 30, 2022 Shares Par Value Balance at January 1, 2022 90,948 909 $ 2,530,383 $ (1,249,319) $ 9 $ 167,436 $ 1,449,418 Net income — — — 17,281 — 12,842 30,123 Common unit distributions — — — — — 218 218 Redeemable noncontrolling interests — — (6,466) — — (13,454) (19,920) Change in noncontrolling interests in consolidated joint ventures — — — — — 18 18 Redemption of common units for common stock 11 — 161 — — (161) — Redemption of common units — — — — — (1,801) (1,801) Shares issued under Dividend Reinvestment and Stock Purchase Plan 2 — 27 — — — 27 Directors' deferred compensation plan — — 220 — — — 220 Stock compensation 143 2 4,464 — — 2,978 7,444 Cancellation of restricted shares (41) — (696) — — — (696) Other comprehensive income — — — — 1,932 190 2,122 Rebalancing of ownership percentage between parent and subsidiaries — — (2,627) — — 2,627 — Balance at June 30, 2022 91,063 911 $ 2,525,466 $ (1,232,038) $ 1,941 $ 170,893 $ 1,467,173 MACK-CALI REALTY, L.P.BALANCE SHEETSSTATEMENTS OF CASH FLOWS (in thousands, except per unit amounts)thousands) (unaudited)Six Months Ended June 30, CASH FLOWS FROM OPERATING ACTIVITIES 2023 2022 Net (loss) income $ (46,365) $ 30,123 Net loss (income) from discontinued operations 365 (23,344) Net (loss) income from continuing operations (46,000) 6,779 Adjustments to reconcile net income (loss) to net cash provided by Operating activities: Depreciation and amortization, including related intangible assets 47,269 39,480 Amortization of deferred compensation stock units 196 220 Amortization of stock compensation 7,339 7,444 Amortization of deferred financing costs 1,808 2,358 Equity in earnings of unconsolidated joint ventures (2,633) (2,151) Distributions of cumulative earnings from unconsolidated joint ventures — 13 Loss (gain) on disposition of developable land 22 (57,748) Land and other impairments, net 3,396 6,832 Loss from extinguishment of debt 2,657 129 Gain on insurance proceeds (2,851) — Interest cost of mandatorily redeemable noncontrolling interests 13,390 — Changes in operating assets and liabilities: Decrease in unbilled rents receivable, net 1,695 3,560 Increase in deferred charges and other assets (1,610) (3,894) (Increase) decrease in accounts receivable, net (248) 225 Decrease in accounts payable, accrued expenses and other liabilities (7,188) (2,915) Increase in rents received in advance and security deposits 502 2,171 Increase (decrease) in accrued interest payable 158 (39) Net cash flows provided by operating activities - continuing operations 17,902 2,464 Net cash flows provided by operating activities - discontinued operations 6,462 43,246 Net cash provided by operating activities $ 24,364 $ 45,710 CASH FLOWS FROM INVESTING ACTIVITIES Rental property acquisitions and related intangibles $ — $ (5,192) Rental property additions, improvements and other costs (5,747) (8,147) Development of rental property and other related costs (5,647) (40,673) Proceeds from the sales of rental property 6,528 28,596 Repayment of notes receivable 1,257 1,433 Investment in unconsolidated joint ventures (98) (147) Distributions in excess of cumulative earnings from unconsolidated joint ventures 6,454 7,450 Proceeds from insurance settlements 3,239 — Net cash provided by (used in) investing activities - continuing operations 5,986 (16,680) Net cash provided by investing activities - discontinued operations 445,648 171,754 Net cash provided by investing activities $ 451,634 $ 155,074 CASH FLOW FROM FINANCING ACTIVITIES Borrowings from revolving credit facility $ 16,000 $ 43,000 Repayment of revolving credit facility (16,000) (115,000) Proceeds from mortgages and loans payable — 149,068 Repayment of mortgages, loans payable and other obligations (84,258) (240,270) Redemption of redeemable noncontrolling interests, net — (12,000) Payment of early debt extinguishment costs (251) (5,140) Common unit redemptions (94) (2,497) Payment of financing costs (1,721) (3,025) Contribution from noncontrolling interests — 18 Distributions to redeemable noncontrolling interests (12,731) (12,908) Payment of common dividends and distributions (38) (56) Net cash used in financing activities $ (99,093) $ (198,810) Net increase in cash and cash equivalents $ 376,905 $ 1,974 Cash, cash equivalents and restricted cash, beginning of period (1) 47,649 51,455 Cash, cash equivalents and restricted cash, end of period (2) $ 424,554 $ 53,429 MACK-CALI REALTY,STATEMENTS OF OPERATIONS (inBALANCE SHEETS(in thousands, except per unit amounts) (unaudited)ASSETS June 30,
2023December 31,
2022Rental property Land and leasehold interests $ 483,195 $ 492,204 Buildings and improvements 2,845,193 3,332,315 Tenant improvements 40,809 122,509 Furniture, fixtures and equipment 100,803 99,094 3,470,000 4,046,122 Less – accumulated depreciation and amortization (438,113) (631,910) 3,031,887 3,414,212 Real estate held for sale, net 122,690 193,933 Net investment in rental property 3,154,577 3,608,145 Cash and cash equivalents 396,940 26,782 Restricted cash 27,614 20,867 Investments in unconsolidated joint ventures 122,435 126,158 Unbilled rents receivable, net 7,808 39,734 Deferred charges and other assets, net 58,961 96,162 Accounts receivable 4,498 2,920 Total assets $ 3,772,833 $ 3,920,768 LIABILITIES AND EQUITY Mortgages, loans payable and other obligations, net $ 1,820,981 $ 1,903,977 Mandatorily redeemable noncontrolling interests 487,619 — Distributions payable 72 110 Accounts payable, accrued expenses and other liabilities 53,239 72,041 Rents received in advance and security deposits 15,710 22,941 Accrued interest payable 6,963 7,131 Total liabilities 2,384,584 2,006,200 Commitments and contingencies Redeemable noncontrolling interests 40,231 515,231 Partners’ Capital: General Partner, 92,041,386 and 91,141,649 common units outstanding 1,127,647 1,163,935 Limited partners, 8,666,675 and 9,301,521 common units/LTIPs outstanding 180,095 193,882 Accumulated other comprehensive income 4,518 3,977 Total Veris Residential, L.P. partners’ capital 1,312,260 1,361,794 Noncontrolling interests in consolidated joint ventures 35,758 37,543 Total equity 1,348,018 1,399,337 Total liabilities and equity $ 3,772,833 $ 3,920,768 MACK-CALI REALTY,COMPREHENSIVE INCOME (LOSS) (in thousands)OPERATIONS(in thousands, except per share amounts) (unaudited)
The accompanying notes are an integral part of these consolidated financial statements.Three Months Ended
June 30,Six Months Ended
June 30,REVENUES 2023 2022 2023 2022 Revenue from leases $ 61,909 $ 47,313 $ 121,747 $ 91,256 Real estate services 643 896 1,554 1,807 Parking income 4,796 4,173 9,129 7,760 Other income 1,381 1,431 3,258 2,491 Total revenues 68,729 53,813 135,688 103,314 EXPENSES Real estate taxes 7,860 7,911 18,980 16,201 Utilities 2,379 1,895 4,882 4,247 Operating services 14,044 13,100 26,307 25,964 Real estate services expenses 4,389 2,920 6,332 5,283 General and administrative 9,582 11,527 19,865 30,976 Transaction related costs 3,319 1,345 4,347 1,345 Depreciation and amortization 23,684 21,015 47,331 39,456 Land and other impairments, net — 3,900 3,396 6,832 Total expenses 65,257 63,613 131,440 130,304 OTHER (EXPENSE) INCOME Interest expense (21,692) (14,741) (43,706) (26,348) Interest cost of mandatorily redeemable noncontrolling interests (13,390) — (13,390) — Interest and other investment income 3,927 189 4,043 347 Equity in earnings of unconsolidated joint ventures 2,700 2,638 2,633 2,151 Gain (loss) on disposition of developable land — 55,125 (22) 57,748 Loss from extinguishment of debt, net (2,657) (129) (2,657) (129) Other income, net 853 — 2,851 — Total other (expense) income, net (30,259) 43,082 (50,248) 33,769 (Loss) income from continuing operations (26,787) 33,282 (46,000) 6,779 Discontinued operations: (Loss) income from discontinued operations 140 5,808 2,344 25,948 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net (3,488) (4,440) (2,709) (2,604) Total discontinued operations, net (3,348) 1,368 (365) 23,344 Net (loss) income (30,135) 34,650 (46,365) 30,123 Noncontrolling interests in consolidated joint ventures 636 784 1,223 1,758 Redeemable noncontrolling interests (617) (6,366) (6,983) (12,803) Net loss (income) available to common unitholders $ (30,116) $ 29,068 $ (52,125) $ 19,078 Basic earnings per common unit: Loss from continuing operations $ (0.27) $ 0.24 $ (0.56) $ (0.11) Discontinued operations (0.03) 0.01 0.00 0.23 Net loss available to common unitholders $ (0.30) $ 0.25 $ (0.56) $ 0.12 Diluted earnings per common unit: (Loss) income from continuing operations $ (0.27) $ 0.24 $ (0.56) $ (0.11) Discontinued operations (0.03) 0.01 0.00 0.23 Net (loss) income available to common unitholders $ (0.30) $ 0.25 $ (0.56) $ 0.12 Basic weighted average units outstanding 100,854 100,329 100,691 100,133 Diluted weighted average units outstanding 100,854 100,352 100,691 100,171 MACK-CALI REALTY,STATEMENTSTATEMENTS OF COMPREHENSIVE INCOME (LOSS)(in thousands) (unaudited)Three Months Ended
June 30,Six Months Ended
June 30,2023 2022 2023 2022 Net (loss) income $ (30,135) $ 34,650 $ (46,365) $ 30,123 Other comprehensive income (loss): Net unrealized gain (loss) on derivative instruments for interest rate swaps 1,536 (60) 591 2,122 Comprehensive (loss) income $ (28,599) $ 34,590 $ (45,774) $ 32,245 Comprehensive loss attributable to noncontrolling interests in consolidated joint ventures 636 784 1,223 1,758 Comprehensive income attributable to redeemable noncontrolling interests (617) (6,366) (6,983) (12,803) Comprehensive (loss) income attributable to common unitholders $ (28,580) $ 29,008 $ (51,534) $ 21,200 (in (in thousands) (unaudited)For the Three Months Ended June 30, 2023 General Partner
Common UnitsLimited Partner
Common Units/
Vested LTIP UnitsCommon
UnitholdersLimited Partner
Common
UnitholdersAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interest
in Consolidated
Joint VenturesTotal Equity Balance at April 1, 2023 91,620 9,116 $ 1,147,640 $ 186,816 $ 3,119 $ 36,394 $ 1,373,969 Net loss — — (27,434) (2,682) — (19) (30,135) Redeemable noncontrolling interests — — — — — (617) (617) Vested LTIP units — 26 — — — — — Redemption of limited partners common units for common stock 271 (271) 4,192 (4,192) — — — Redemption of limited partner common units — (4) — (78) — — (78) Shares issued under Dividend Reinvestment and Stock Purchase Plan — — 1 — — — 1 Directors' deferred compensation plan 21 — 86 — — — 86 Other comprehensive income — — — 137 1,399 — 1,536 Stock compensation 144 — 3,381 94 — — 3,475 Cancellation of common stock (15) — (219) — — — (219) Balance at June 30, 2023 92,041 8,867 $ 1,127,647 $ 180,095 $ 4,518 $ 35,758 $ 1,348,018 For the Three Months Ended June 30, 2022 General Partner
Common UnitsLimited Partner
Common Units/
Vested LTIP UnitsCommon
UnitholdersLimited Partner
Common
UnitholdersAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interest
in Consolidated
Joint VenturesTotal Equity Balance at April 1, 2022 90,956 8,962 $ 1,201,834 $ 197,552 $ 1,995 $ 39,420 $ 1,440,801 Net income — — 26,373 2,695 — 5,582 34,650 Redeemable noncontrolling interests — — (3,524) (360) — (6,366) (10,250) Change in noncontrolling interests in consolidated joint ventures — — — — — 7 7 Vested LTIP units — 362 — — — — — Redemption of limited partners common units for common stock 11 (11) 161 (161) — — — Redemption of limited partners common units — (23) — (359) — — (359) Shares issued under Dividend Reinvestment and Stock Purchase Plan 1 — 16 — — — 16 Directors' deferred compensation plan — — 110 — — — 110 Other comprehensive loss — — — (6) (54) — (60) Stock compensation 136 — 2,509 445 — — 2,954 Cancellation of common stock (41) — (696) — — — (696) Balance at June 30, 2022 91,063 9,290 $ 1,226,783 $ 199,806 $ 1,941 $ 38,643 $ 1,467,173 MACK-CALI REALTY,CASH FLOWSCHANGES IN EQUITY (in thousands) (unaudited)For the Six Months Ended June 30, 2023 General Partner
Common UnitsLimited Partner
Common Units/
Vested LTIP UnitsCommon
UnitholdersLimited Partner
Common
UnitholdersAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interest
in Consolidated
Joint VenturesTotal Equity Balance at January 1, 2023 91,142 9,301 $ 1,163,935 $ 193,882 $ 3,977 $ 37,543 $ 1,399,337 Net (loss) income — — (47,407) (4,718) — 5,760 (46,365) Unit distributions — — — — — — — Redeemable noncontrolling interests — — (4,516) (461) — (6,983) (11,960) Change in noncontrolling interests in consolidated joint ventures — — — — — (562) (562) Vested LTIP units — 221 — — — — — Redemption of limited partners common units for shares of general partner common units 650 (650) 9,051 (9,051) — — — Redemption of limited partner common units — (5) — (94) — — (94) Shares issued under Dividend Reinvestment and Stock Purchase Plan — — 2 — — — 2 Directors' deferred compensation plan 21 — 196 — — — 196 Other comprehensive income — — — 50 541 — 591 Stock compensation 259 — 6,852 487 — — 7,339 Cancellation of restricted shares (31) — (466) — — — (466) Balance at June 30, 2023 92,041 8,867 $ 1,127,647 $ 180,095 $ 4,518 $ 35,758 $ 1,348,018 For the Six Months Ended June 30, 2022 General Partner
Common UnitsLimited Partner
Common Units/
Vested LTIP UnitsCommon
UnitholdersLimited Partner
Common
UnitholdersAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interest
in Consolidated
Joint VenturesTotal Equity Balance at January 1, 2022 90,948 9,013 $ 1,211,790 $ 197,236 $ 9 $ 40,383 $ 1,449,418 Net income — — 17,281 1,797 — 11,045 30,123 Distributions to unitholders — — — 218 — — 218 Redeemable noncontrolling interests — — (6,466) (651) — (12,803) (19,920) Change in noncontrolling interests in consolidated joint ventures — — — — — 18 18 Vested LTIP units — 397 — — — — — Redemption of limited partners common units for shares of general partner common units 11 (11) 161 (161) — — — Redemption of limited partners common units — (109) — (1,801) — — (1,801) Shares issued under Dividend Reinvestment and Stock Purchase Plan 2 — 27 — — — 27 Directors' deferred compensation plan — — 220 — — — 220 Other comprehensive income — — — 190 1,932 — 2,122 Stock compensation 143 — 4,466 2,978 — — 7,444 Cancellation of restricted shares (41) — (696) — — — (696) Balance at June 30, 2022 91,063 9,290 $ 1,226,783 $ 199,806 $ 1,941 $ 38,643 $ 1,467,173 MACK-CALI REALTY CORPORATION, MACK-CALI REALTY,Six Months Ended June 30, CASH FLOWS FROM OPERATING ACTIVITIES 2023 2022 Net (loss) income $ (46,365) $ 30,123 Net loss (income) from discontinued operations 365 (23,344) Net (loss) income from continuing operations (46,000) 6,779 Adjustments to reconcile net income (loss) to net cash provided by Operating activities: Depreciation and amortization, including related intangible assets 47,269 39,480 Amortization of deferred compensation stock units 196 220 Amortization of stock compensation 7,339 7,444 Amortization of deferred financing costs 1,808 2,358 Equity in earnings of unconsolidated joint ventures (2,633) (2,151) Distributions of cumulative earnings from unconsolidated joint ventures — 13 Loss (gain) on disposition of developable land 22 (57,748) Land and other impairments, net 3,396 6,832 Loss from extinguishment of debt 2,657 129 Gain on insurance proceeds (2,851) — Interest cost of mandatorily redeemable noncontrolling interests 13,390 — Changes in operating assets and liabilities: Decrease in unbilled rents receivable, net 1,695 3,560 Increase in deferred charges and other assets (1,610) (3,894) (Increase) decrease in accounts receivable, net (248) 225 Decrease in accounts payable, accrued expenses and other liabilities (7,188) (2,915) Increase in rents received in advance and security deposits 502 2,171 Increase (decrease) in accrued interest payable 158 (39) Net cash flows provided by operating activities - continuing operations 17,902 2,464 Net cash flows provided by operating activities - discontinued operations 6,462 43,246 Net cash provided by operating activities $ 24,364 $ 45,710 CASH FLOWS FROM INVESTING ACTIVITIES Rental property acquisitions and related intangibles $ — $ (5,192) Rental property additions, improvements and other costs (5,747) (8,147) Development of rental property and other related costs (5,647) (40,673) Proceeds from the sales of rental property 6,528 28,596 Repayment of notes receivable 1,257 1,433 Investment in unconsolidated joint ventures (98) (147) Distributions in excess of cumulative earnings from unconsolidated joint ventures 6,454 7,450 Proceeds from insurance settlements 3,239 — Net cash provided by (used in) investing activities - continuing operations 5,986 (16,680) Net cash provided by investing activities - discontinued operations 445,648 171,754 Net cash provided by investing activities $ 451,634 $ 155,074 CASH FLOW FROM FINANCING ACTIVITIES Borrowings from revolving credit facility $ 16,000 $ 43,000 Repayment of revolving credit facility (16,000) (115,000) Proceeds from mortgages and loans payable — 149,068 Repayment of mortgages, loans payable and other obligations (84,258) (240,270) Redemption of redeemable noncontrolling interests, net — (12,000) Payment of early debt extinguishment costs (251) (5,140) Common unit redemptions (94) (2,497) Payment of financing costs (1,721) (3,025) Contribution from noncontrolling interests — 18 Distributions to redeemable noncontrolling interests (12,731) (12,908) Payment of common dividends and distributions (38) (56) Net cash used in financing activities $ (99,093) $ (198,810) Net increase in cash and cash equivalents $ 376,905 $ 1,974 Cash, cash equivalents and restricted cash, beginning of period (1) 47,649 51,455 Cash, cash equivalents and restricted cash, end of period (2) $ 424,554 $ 53,429 Mack-Cali Realty Corporation,Mack-Cali Realty,Veris Residential, L.P., a Delaware limited partnership, together with its subsidiaries (collectively, the “Operating Partnership”), as its sole general partner and owned an 89.6a 91.2 and 89.590.7 percent common unit interest in the Operating Partnership as of SeptemberJune 30, 20172023 and December 31, 2016,2022, respectively.General Partner’sCompany develops, owns and operates predominantly multifamily rental properties located primarily in the Northeast, as well as a portfolio of non-strategic commercial properties and a parcel of land located in the Northeast. The Company recently completed its transition to a pure-play multifamily REIT and is focused on conducting business is the ownership of interests in a socially, ethically, and operation of the Operating Partnership and all of the General Partner’s expenses are incurred for the benefit of the Operating Partnership. The General Partner is reimbursed by the Operating Partnershipenvironmentally responsible manner, while seeking to maximize value for all expenses it incurs relating to the ownership and operation of the Operating Partnership.The Operating Partnership conducts the business of providing leasing, management, acquisition, development and tenant-related services for its General Partner. The Operating Partnership, through its operating divisions and subsidiaries, including the Mack-Cali property-owning partnerships and limited liability companies, is the entity through which all of the General Partner’s operations are conducted. stakeholders. Veris Residential, Inc. was incorporated on May 24, 1994.SeptemberJune 30, 2017,2023, the Company owned or had interests in 162 properties, consisting of 73 office and 71 flex properties, totaling approximately 18.4 million square feet, leased to approximately 900 commercial tenants, and 18 multi-family24 multifamily rental properties containing 5,826 residential units, plus developable land (collectively, the “Properties”).as well as non-core assets comprised of three office properties and four parking/retail properties. The Properties are comprised of: (a) 23 wholly-owned or Company-controlled properties comprised of 73 office buildings totaling approximately 14.8 million square feet (which include four buildings, aggregating approximately 0.5 million square feet17 multifamily properties and six non-core assets, and (b) eight properties owned by unconsolidated joint ventures in which the Company has investment interests)interests, including seven multifamily properties and a non-core asset.56 office/flex buildings totaling approximately 3.1 million square feet, six industrial/warehouse buildings totaling approximately 387,400 square feet, 18 multi-family properties totaling 5,826 apartments (which include eight properties aggregating 3,275 apartments owned by unconsolidated joint ventures inof which the Company has investment interests), six parking/retail properties totaling approximately 137,100 square feet (which include two buildings aggregating 81,700 square feet owned by unconsolidated joint ventures indrew down on the entire $115 million 2023 Term Loan and $52 million of the 2023 Revolving Credit Facility, which along with cash on hand, was used to complete the Company has investment interests), one hotel (which is owned by an unconsolidated joint venture in whichRockpoint Redemption. For more information about the Company has an investment interest)Rockpoint Purchase Agreement, 2023 Revolving Credit Facility and two parcels of land leased to others. The Properties are located in six states, primarily in the Northeast, plus the District of Columbia.2:2 to the 2022 10-K: Significant Accounting Policies —– Investments in Unconsolidated Joint Ventures, for the Company’s treatment of unconsolidated joint venture interests. Intercompany accounts and transactions have been eliminated.On January 1, 2016, the Company adopted accounting guidance under Consolidation, modifying the analysis it must perform to determine whether it should consolidate certain types of legal entities. The guidance does not amend the existing disclosure requirements for variable interest entities or voting interest model entities. The guidance, however, modified the requirements to qualify under the voting interest model. Under the revised guidance, the Operating Partnership will beis considered a variable interest entity of the parent company, Mack-Cali Realty Corporation.Veris Residential, Inc. As the Operating Partnership is already consolidated in theMack-Cali Realty Corporation, the identification ofVeris Residential, Inc., this entity as a variable interest entity has no impact on the consolidated financial statements of Mack-Cali Realty Corporation. There were no other legal entities qualifying under the scope of the revised guidance that were consolidated as a result of the adoption.SeptemberJune 30, 20172023 and December 31, 2016,2022, the Company’s investments in consolidated real estate joint ventures, which are variable interest entities in which the Company is deemed to be the primary beneficiary, other than RoselandVeris Residential Partners, L.P. (See Note 3:14: Redeemable Noncontrolling Interests – Rockpoint Transaction), have total real estate assets of $174.7$454.6 million and $201.9$468.1 million, respectively, other assets of $6.6 million and $6.0 million, respectively, mortgages of $68.3$285.4 million and $78.4$285.5 million, respectively, and other liabilities of $20.6$15.3 million and $19.2$17.3 million, respectively.presentation.statedreported at cost less accumulated depreciation and amortization. Costs directly related to the acquisition, development and construction of rental properties are capitalized. Acquisition—related costs were expensed as incurred through December 31, 2016. The Company early adopted the recently issued FASB guidance Accounting Standards Update (“ASU”) 2017-01 on January 1, 2017 which revises the definition of a business and is expected to result in more transactions to be accounted for as asset acquisitions and significantly limit transactions that would be accounted for as business combinations. Where an acquisition has been determined to be an asset acquisition, acquisition-related transaction costs are capitalized. Capitalized development and construction costs include pre-construction costs essential to the development of the property, development and construction costs, interest, property taxes, insurance, salaries and other project costs incurred during the period of development. Capitalized development and construction salaries and related costs approximated $0.6$0.2 million and $0.7$0.4 million for the three months ended SeptemberJune 30, 20172023 and 2016,2022, respectively, and $1.8$0.3 million and $1.9$0.9 million for the ninesix months ended SeptemberJune 30, 20172023 and 2016, respectively. Included in total rental property is construction, tenant improvement and development in-progress of $466.8 million and $361.1 million as of September 30, 2017 and December 31, 2016,2022, respectively. Ordinary repairs and maintenance are expensed as incurred; major replacements and betterments,improvements, which improveenhance or extend the life of the asset, are capitalized and depreciated over their estimated useful lives. Fully-depreciated assets are removed from the accounts.June 30,
2023December 31,
2022Land held for development (including pre-development costs, if any) (a)(b) $ 256,190 $ 264,934 Development and construction in progress, including land (c) 36,601 205,173 Total $ 292,791 $ 470,107 tenant improvements, but no later than one year from cessation of major construction activity (as distinguished from activities such as routine maintenance and cleanup). If portions of a rental project are substantially completed and occupied by tenants or residents, or held available for occupancy, and other portions have not yet reached that stage, the substantially completed portions are accounted for as a separate project. The Company allocates costs incurred between the portions under construction and the portions substantially completed and held available for occupancy, primarily based on a percentage of the relative commercial square footage or multifamily units of each portion, and capitalizes only those costs associated with the portion under construction.Properties are depreciated using the straight-line method over the estimated useful lives of the assets. The estimated useful lives are as follows:Leasehold interestsRemaining lease termBuildings and improvements5 to 40 yearsTenant improvementsThe shorter of the term of the related lease or useful lifeFurniture, fixtures and equipment5 to 10 yearsUpon acquisition of rental property, the Company estimates the fair value of acquired tangible assets, consisting of land, buildingimprovements, and identified intangible assets and liabilities assumed, generallyconsisting of the fair value of (i) above and below-market leases, (ii) in-place leases and (iii) tenant relationships. The Company allocates the purchase price to the assets acquired and liabilities assumed based on their fair values. The Company records goodwill or a gain on bargain purchase (if any) if the net assets acquired/liabilities assumed differ from the purchase consideration of a transaction.In estimating the fair value of the tangible and intangible assets acquired, the Company considers information obtained about each property asDistributions Payableits due diligence and marketing and leasing activities, and utilizes various valuation methods, such as estimated cash flow projections utilizing appropriate discount and capitalization rates, estimates of replacement costs net of depreciation, and available market information. The fair value of the tangible assets of an acquired property considers the value of the property as if it were vacant.Above-market and below-market lease values for acquired properties are initially recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to each in-place lease and (ii) management’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases and the remaining initial term plus the term of any below-market fixed rate renewal options for below-market leases. The capitalized above-market lease values are amortized as a reduction of base rental revenue over the remaining terms of the respective leases, and the capitalized below-market lease values are amortized as an increase to base rental revenue over the remaining initial terms plus the terms of any below-market fixed rate renewal options of the respective leases.Other intangible assets acquired include amounts for in-place lease values and tenant relationship values, which are based on management’s evaluation of the specific characteristics of each tenant’s lease and the Company’s overall relationship with the respective tenant. Factors to be considered by management in its analysis of in-place lease values include an estimate of carrying costs during hypothetical expected lease-up periods considering current market conditions, and costs to execute similar leases. In estimating carrying costs, management includes real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease-up periods, depending on local market conditions. In estimating costs to execute similar leases, management considers leasing commissions, legal and other related expenses. Characteristics considered by management in valuing tenant relationships include the nature and extentcompletion of the Company’s existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals. The value of in-place leases are amortizedtransformation to expense over the remaining initial terms of the respective leases. The value of tenant relationship intangibles are amortized to expense over the anticipated life of the relationships.On a periodic basis, management assesses whether there are any indicators that the value ofpure-play multifamily REIT, as well as the Company’s rental properties held for use may be impaired. In addition to identifying any specific circumstances which may affect a property or properties, management considers other criteria for determining which properties may require assessment for potential impairment. The criteria considered by management include reviewing low leased percentages, significant near-term lease expirations, current and historical operating and/or cash flow losses, near-term mortgage debt maturities and/or other factors, including those that might impact the Company’s intent and ability to hold the property. A property’s value is impaired only if management’s estimate of the aggregate future cash flows (undiscounted and without interest charges) to be generated by the property is less than the carrying value of the property. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying value of the property over the fair value of the property. The Company’s estimates of aggregate future cash flows expected to be generated by each property are based on a number of assumptions. These assumptions are generally based on management’s experience in its local real estate markets and the effects of current market conditions. The assumptions are subject to economic and market uncertainties including, among others, demand for space, competition for tenants, changes in market rental rates, and costs to operate each property. As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the future cash flows estimated by management in its impairment analyses may not be achieved, and actual losses or impairments may be realized in the future.Rental PropertyHeld for Sale When assets are identified by management as held for sale, the Company discontinues depreciating the assets and estimates the sales price, net of selling costs, of such assets. The Company generally considers assets to be held for sale when the transaction has received appropriate corporate authority, and there are no significant contingencies relating to the sale. If, in management’s opinion, the estimated net sales price, net of selling costs, of the assets which have been identified as held for sale is less than the carrying value of the assets, a valuation allowance is established.If circumstances arise that previously were considered unlikely and, as a result, the Company decides not to sell a property previously classified as held for sale, the property is reclassified as held and used. A property that is reclassified is measured and recorded individually at the lower of (a) its carrying value before the property was classified as held for sale, adjusted for any depreciation (amortization) expense that would have been recognized had the property been continuously classified as held and used, or (b) the fair value at the date of the subsequent decision not to sell.Investments inUnconsolidatedJoint Ventures The Company accounts for its investments in unconsolidated joint ventures under the equity method of accounting. The Company applies the equity method by initially recording these investments at cost, as Investments in Unconsolidated Joint Ventures, subsequently adjusted for equity in earnings and cash contributions and distributions. The outside basis portion of the Company’s joint ventures is amortized over the anticipated useful lives of the underlying ventures’ tangible and intangible assets acquired and liabilities assumed. Generally, the Company would discontinue applying the equity method when the investment (and any advances) is reduced to zero and would not provide for additional losses unless the Company has guaranteed obligations of the venture or is otherwise committed to providing further financial support for the investee. If the venture subsequently generatestaxable income, the Company only recognizes its shareBoard of such income to the extent it exceeds its share of previously unrecognized losses.If the venture subsequently makes distributions and the Company does not have an implied or actual commitment to support the operations of the venture, including a general partner interest in the investee, the Company will not record a basis less than zero, rather such amounts will be recorded as equity in earnings of unconsolidated joint ventures.On a periodic basis, management assesses whether there are any indicators that the value of the Company’s investments in unconsolidated joint ventures may be impaired. An investment is impaired only if management’s estimate of the value of the investment is less than the carrying value of the investment, and such decline in value is deemed to be other than temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying value of the investment over the value of the investment. The Company’s estimates of value for each investment (particularly in real estate joint ventures) are based on a number of assumptions that are subject to economic and market uncertainties including, among others, demand for space, competition for tenants, changes in market rental rates, and operating costs. As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the values estimated by management in its impairment analyses may not be realized, and actual losses or impairment may be realized in the future. See Note 4: Investments in Unconsolidated Joint Ventures.Cash and CashEquivalents All highly liquid investments with an original maturity of three months or less when purchased are considered to be cash equivalents.DeferredFinancing Costs Costs incurred in obtaining financing are capitalized and amortized over the term of the related indebtedness. Deferred financing costs are presented in the balance sheet as a direct deduction from the carrying value of the debt liability to which they relate, except deferred financing costs related to the revolving credit facility, which are presented in deferred charges, goodwill and other assets. In all cases, amortization of such costs is included in interest expense and was $1,184,000 and $1,234,000 for the three months ended September 30, 2017 and 2016, respectively, and $3,462,000 and $3,583,000 for the nine months ended September 30, 2017 and 2016, respectively. If a financing obligation is extinguished early, any unamortized deferred financing costs are written off and included in gains (losses) from extinguishment of debt. Included in gain (loss) from extinguishment of debt, net for the three and nine months ended September 30, 2017 were unamortized deferred financing costs which were written off of zero and $239,000 and $346,000 for both the three and nine month periods ended September 30, 2016.DeferredLeasing Costs Costs incurred in connection with commercial leases are capitalized and amortized on a straight-line basis over the terms of the related leases and included in depreciation and amortization. Unamortized deferred leasing costs are charged to amortization expense upon early termination of the lease. Certain employees of the Company are compensated for providing leasing services to the Properties. The portion of such compensationrelated to commercial leases, which is capitalized and amortized, and included in deferred charges, goodwill and other assets, net, was approximately $607,000 and $790,000 for the three months ended September 30, 2017 and 2016, respectively, and $2,595,000 and $2,440,000 for the nine months ended September 30, 2017 and 2016, respectively.Goodwill Goodwill represents the excess of the purchase price over the fair value of net tangible and intangible assets acquired in a business combination. Goodwill is allocated to various reporting units, as applicable. Each of the Company’s segments consists of a reporting unit. Goodwill is not amortized. Management performs an annual impairment test for goodwill during the fourth quarter and between annual tests, management evaluates the recoverability of goodwill whenever events or changes in circumstances indicate that the carrying value of goodwill may not be fully recoverable. In its impairment tests of goodwill, management first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. If, based on this assessment, management determines that the fair value of the reporting unit is not less than its carrying value, then performing the additional two-step impairment test is unnecessary. If the carrying value of goodwill exceeds its fair value, an impairment charge is recognized.DerivativeInstruments The Company measures derivative instruments, including certain derivative instruments embedded in other contracts, at fair value and records them as an asset or liability, depending on the Company’s rights or obligations under the applicable derivative contract. For derivatives designated and qualifying as fair value hedges, the changes in the fair value of both the derivative instrument and the hedged item are recorded in earnings. For derivatives designated as cash flow hedges, the effective portions of the derivative are reported in other comprehensive income (“OCI”) and are subsequently reclassified into earnings when the hedged item affects earnings. Changes in fair value of derivative instruments not designated as hedging and ineffective portions of hedges are recognized in earnings in the affected period.RevenueRecognition Base rental revenue is recognized on a straight-line basis over the terms of the respective leases. Unbilled rents receivable represents the cumulative amount by which straight-line rental revenue exceeds rents currently billed in accordance with the lease agreements.Above-market and below-market lease values for acquired properties are initially recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to each in-place lease and (ii) management’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases and the remaining initial term plus the term of any below-market fixed-rate renewal options for below-market leases. The capitalized above-market lease values for acquired properties are amortized as a reduction of base rental revenue over the remaining terms of the respective leases, and the capitalized below-market lease values are amortized as an increase to base rental revenue over the remaining initial terms plus the terms of any below-market fixed-rate renewal options of the respective leases.Escalations and recoveries from tenants are received from tenants for certain costs as provided in the lease agreements. These costs generally include real estate taxes, utilities, insurance, common area maintenance and other recoverable costs. See Note 13: Tenant Leases.Real estate services revenue includes property management, development, construction and leasing commission fees and other services, and payroll and related costs reimbursed from clients. Fee income derived from the Company’s unconsolidated joint ventures (which are capitalized by such ventures) are recognized to the extent attributable to the unaffiliated ownership interests.Parking income includes income from parking spaces leased to tenants and others.Other income includes income from tenants for additional services arranged for by the Company and income from tenants for early lease terminations.Allowance forDoubtful Accounts Management performs a detailed review of amounts due from tenants to determine if an allowance for doubtful accounts is required based on factors affecting the collectability of the accounts receivable balances. The factors considered by management in determining which individual tenant receivable balances, or aggregate receivable balances, require a collectability allowance include the age of the receivable, the tenant’s paymenthistory, the nature of the charges, any communications regarding the charges and other related information. Management’s estimate of the allowance for doubtful accounts requires management to exercise significant judgment about the timing, frequency and severity of collection losses, which affects the allowance and net income.Income andOther Taxes The General Partner has elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “IRS Code”). As a REIT, the General Partner generally will not be subject to corporate federal income tax (including alternative minimum tax) on net income that it currently distributes to its shareholders, provided that the General Partner satisfies certain organizational and operational requirements including the requirement to distribute at least 90 percent of its REIT taxable income (determined by excluding any net capital gains) to its shareholders. If and to the extent the General Partner retains and does not distribute any net capital gains, the General Partner will be required to pay federal, state and local taxes, as applicable, on such net capital gains at the rate applicable to capital gains of a corporation.The Operating Partnership is a partnership, and, as a result, all income and losses of the partnership are allocated to the partners for inclusion in their respective tax returns. Accordingly, no provision or benefit for income taxes has been made in the accompanying financial statements.The General Partner has elected to treat certain of its corporate subsidiaries as taxable REIT subsidiaries (each a “TRS”). In general, a TRSDirectors of the General Partner may perform additional services for tenants(the "Board of Directors") has decided to reinstate a quarterly dividend beginning with the third quarter of 2023. The Company will reevaluate its dividend as the Company completes the sale of non-strategic asset sales.generally may engagepayment of dividends and distributions will continue to be determined by the Board of Directors in any real estate or non-real estate related business (except forlight of conditions then existing, including the operation or managementCompany’s earnings, cash flows, financial condition, capital requirements, debt maturities, the availability of health care facilities or lodging facilities ordebt and equity capital, applicable REIT and legal restrictions and the providing to any person, under a franchise, license or otherwise, rights to any brand name under which any lodging facility or health care facility is operated). A TRS is subject to corporate federal income tax. The General Partner has conducted business through its TRS entities for certain property management, development, constructiongeneral overall economic conditions and other related services, as well as to hold a joint venture interest in a hotel and other matters.As of September 30, 2017,factors.haddeclared a deferred tax asset related$0.05 dividend per common share to its TRS activity with a balancebe payable on October 10, 2023 to shareholders of approximately $17.1 million which has been fully reserved for through a valuation allowance. If the General Partner fails to qualify as a REIT in any taxable year, the Company will be subject to federal income tax (including any applicable alternative minimum tax) on its taxable income at regular corporate tax rates. The Company is subject to certain state and local taxes.Pursuant to the amended provisions related to uncertain tax provisions of ASC 740, Income Taxes, the Company recognized no material adjustments regarding its tax accounting treatment. The Company expects to recognize interest and penalties related to uncertain tax positions, if any, as income tax expense, which is included in general and administrative expense.In the normal course of business, the Company or one of its subsidiaries is subject to examination by federal, state and local jurisdictions in which it operates, where applicable. As of September 30, 2017, the tax years that remain subject to examination by the major tax jurisdictions under the statute of limitations are generally from the year 2012 forward.EarningsPer Shareor Unit The Company presents both basic and diluted earnings per share or unit (“EPS or EPU”). Basic EPS or EPU excludes dilution and is computed by dividing net income available to common shareholders or unitholders by the weighted average number of shares or units outstanding for the period. Diluted EPS or EPU reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock, where such exercise or conversion would result in a lower EPS or EPU from continuing operations amount. Shares or Units whose issuance is contingent upon the satisfaction of certain conditions shall be considered outstanding and included in the computation of diluted EPS or EPU as follows (i) if all necessary conditions have been satisfied by the end of the period (the events have occurred), those shares or units shall be includedrecord as of the beginningclose of the period in which the conditions were satisfied (or as of the date of the grant, if later) or (ii) if all necessary conditions have not been satisfied by the end of the period, the number of contingently issuable shares or units included in diluted EPS or EPU shall be basedbusiness on the number of shares or units, if any, that would be issuable if the end of the reporting period were the end of the contingency period (for example, the number of shares or units that would be issuable based on current period earnings or period-end market price) and if the result would be dilutive. Those contingently issuable shares or units shall beincluded in the denominator of diluted EPS or EPU as of the beginning of the period (or as of the date of the grant, if later).Dividends andDistributionsPayableSeptember 30, 2023.SeptemberJune 30, 2017 represents dividends payable to common shareholders (89,913,684 shares)2023 and distributions payable to noncontrolling interest unitholders of the Operating Partnership (10,438,855 common units and 1,230,877 LTIP units), for all such holders of record as of October 3, 2017 with respect to the third quarter 2017. The third quarter 2017 common stock dividends and unit distributions of $0.20 per common share, common unit and LTIP unit were approved by the General Partner’s Board of Directors on September 14, 2017 and paid on October 13, 2017.The dividends and distributions payable at December 31, 2016 represents dividends2022 represent amounts payable to common shareholders (89,696,824 shares) and distributions payable to noncontrolling interest unitholders of the Operating Partnership (10,488,105 common units and 657,373on unvested LTIP units)units.all such holders of record as of January 5, 2017 with respect to the fourth quarter 2016. The fourth quarter 2016 common stock dividends and unit distributions of $0.15 per common share, common unit and LTIP unit were approved by the General Partner’s Board of Directors on December 13, 2016 and paid on January 13, 2017.Costs IncurredFor StockIssuances Costs incurred in connection with the Company’s stock issuances are reflected as a reduction of additional paid-in capital.StockCompensationSale/Discontinued Operations/Dispositionsaccounts for stock compensation in accordance withhas discontinued operations related to its former New Jersey office and hotel portfolio (collectively, the provisions of ASC 718, Compensation-Stock Compensation. These provisions require that the estimated fair value of restricted stock (“Restricted Stock Awards”“Office Portfolio”), performance share units, long-term incentive plan awards and stock options at the grant date be amortized ratably into expense over the appropriate vesting period. The Company recorded stock compensation expense of $2,169,000 and $2,046,000 for the three months ended September 30, 2017 and 2016, respectively, and $5,268,000 and $4,299,000 for the nine months ended September 30, 2017 and 2016, respectively.OtherComprehensiveIncome (Loss) Other comprehensive income (loss) includes items that are recorded in equity, such as effective portions of derivatives designated as cash flow hedges or unrealized holding gains or losses on marketable securities available for sale.Fair ValueHierarchy The standard Fair Value Measurements specifies which represented a hierarchy of valuation techniques based upon whether the inputs to those valuation techniques reflect assumptions other market participants would use based upon market data obtained from independent sources (observable inputs). The following summarizes the fair value hierarchy:· Level 1: Quoted prices in active markets that are unadjusted and accessible at the measurement date for identical, unrestricted assets or liabilities;· Level 2: Quoted prices for identical assets and liabilities in markets that are inactive, quoted prices for similar assets and liabilities in active markets or financial instruments for which significant inputs are observable, either directly or indirectly, such as interest rates and yield curves that are observable at commonly quoted intervals and· Level 3: Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.Impact OfRecently-IssuedAccountingStandards In May 2014, the FASB issued ASU 2014-09 Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). ASU 2014-09 is a comprehensive new revenue recognition model requiring a company to recognize revenue to depict the transfer of goods or services to a customer at an amount reflecting the consideration it expects to receive in exchange for those goods or services. In adopting ASU 2014-09, companies may use either a full retrospective or a modified retrospective approach. Additionally, this guidance requires improved disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. ASU 2014-09 is effective for the first interim period within annual reporting periods beginning after December 15, 2017, and early adoption is permitted for periods beginning after December 15, 2016. While lease contracts with customers, which constitute the majority of the Company’s revenues, are a specific scope exception of ASU 2014-09, certain of the Company’s revenue streams may be impacted by ASU 2014-09. The Company does not expect the adoption to have a material impact on the Company’s rental income. The Company continues to evaluate the effect the adoption will have on the Company’s other sources of revenue which include management services and other fee income. However, the Company currently does not believe the adoption will significantly affect the timing of the recognition of the Company’s services income. The Company plans to adopt this standard using the modified retrospective approach, which requires a cumulative effect adjustment as of the date of adoption.In February 2016, the FASB issued ASU 2016-02, modifying the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for in the same manner as operating leases today. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. The guidance is expected to impact the consolidated financial statements as the Company has certain operating and land lease arrangements for which it is the lessee. The guidance supersedes previously issued guidance under ASC Topic 840 “Leases.” The guidance is effective on January 1, 2019, with early adoption permitted. The Company is currently in the process of evaluating the impact the adoption of ASU 2016-02 will have on the Company’s consolidated financial statements.In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 addresses eight specific cash flow issues and intends to reduce the diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. This guidance is effective for annual periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted. Upon its adoption of ASU 2016-15, the Company will present its restricted cash with cash and not as a cash adjustmentstrategic shift in the Company’s consolidated statementoperations beginning in 2019. During the second quarter of cash flows.3. RECENT TRANSACTIONSManagement ChangesOn April 5, 2017,2023, the Company announced that president Michael J. DeMarco would be assuming the titleidentified one additional office property as discontinued operations. See Note 7: Discontinued Operations.chief executive officer ofJune 30, 2023, the Company and Mitchell Rudin, formerly the chief executive officer, was being named the vice chairman at the Company effective April 4, 2017. Mr. DeMarco had joined the Company in 2015included as the president and chief operating officer.AcquisitionsThe Company acquired the followingheld for sale two office properties (which were determined to be asset acquisitions in accordance with ASU 2017-01) during the nine months ended September 30, 2017 (dollars in thousands):(a) This acquisition was funded through borrowings under the Company’s unsecured revolving credit facility.(b) This acquisition was funded through borrowings under the Company’s unsecured revolving credit facilitytotaling approximately 0.6 million square feet and a new $124.5 million loan secured by three of the properties.The purchase prices were allocated to the net assets acquired, as follows (in thousands):(a) Above market, in-place and below market leasesseveral developable land parcels, which are being amortized over a weighted-average term of 5.4 years.ConsolidationOn February 3, 2017, the Operating Partnership issued 42,800 shares of a new class of 3.5 percent Series A Preferred Limited Partnership Units of the Operating Partnership (the “Series A Units”) valued at $42.8 million. The Series A Units were issued to the Company’s partners in the Plaza VIII & IX Associates L.L.C. joint venture that owns a development site adjacent to the Company’s Harborside propertylocated in Jersey City, Holmdel and Parsippany, New Jersey as non-cash consideration for their approximate 37.5 percent interest inJersey.joint venture. Concurrent with the issuance of the Series A Units, the Company purchased from other partners in the Plaza VIII & IX Associates L.L.C. joint venture their approximate 12.5 percent interest for approximately $14.3 million in cash. The results of these transactions increased the Company’s interests in the joint venture from 50 percent to 100 percent. Upon these acquisitions, the Company consolidated Plaza VIII & IX Associates L.L.C., a voting interest entity, substantially all of which is comprised of land for development. As an acquisition of the additional 50 percent of the land, the Company accounted for the transaction under a cost accumulation model, resulting in total consolidated assets of $60.6 million, substantially all of which is classified as land on the Balance Sheet.On February 28, 2017, the Operating Partnership authorized the issuance of 9,213 shares of a new class of 3.5 percent Series A-1 Preferred Limited Partnership Units of the Operating Partnership (the “Series A-1 Units”). 9,122 Series A-1 Units were issued on February 28, 2017, valued at $9.1 million, to the Company’s partner in a joint venture with the Operating Partnership, which owns Monaco Towers in Jersey City, New Jersey that includes 523 apartment homes in two fifty-story towers with 558 parking spaces and 12,300 square feet of ground floor retail space. The Series A-1 Units were issued as non-cash consideration for the partner’s approximate 13.8 percent ownership interest in the joint venture to increase the Company’s unconsolidated investment to 29 percent. In April 2017, an additional 91 Series A-1 Units were issued by the Operating Partnership to purchase from other partners in the same joint venture their approximate 71.2 percent ownership interest for approximately $130.9 million in cash and $171.2 million in assumed debt in transactions which closed in April 2017. The results of these transactions increased the Company’s interests in the joint venture to 100 percent. Upon these acquisitions, the Company consolidated RoseGarden Monaco Holdings, L.L.C., a voting interest entity.As an acquisition of the remaining interests in the venture which owns the Monaco Towers, the Company accounted for the transaction under a cost accumulation model, resulting in total consolidated net assets of $139.9 million which is allocated, as follows (in thousands):(a) Above market, in-place and below market leases are being amortized over a weighted-average term of 8 months.Dispositions/Rental Property Held for SaleThe Company disposed of the following office properties during the ninesix months ended SeptemberJune 30, 2017 (dollars in thousands):(a)The Company recorded2023, a valuation allowance of $7.7 million on this property during the year ended December 31, 2016.(b)$15.1 million of the sales proceeds from this sale were held by a qualified intermediary, which is noncash and recorded in deferred charges, goodwill and other assets as of September 30, 2017. See Note 5: Deferred Charges, Goodwill and Other Assets, Net.(c)At closing, the Company provided short term seller financing through mortgage notes receivable to the two separate buyers of $24.8 million and $40.2 million, respectively, with interest rates ranging from 4.0 to 7.0 percent, which mature in November 2017, some with three 30-day extension options. These amounts are noncash components of the net sales proceeds. See Note 5: Deferred Charges, Goodwill and Other Assets, Net.(d)This disposition is of a ground leased land property.(e)The Company recorded an impairment charge of $7.0 million on this property during the year ended December 31, 2015.(f)The Company recorded an impairment charge of $4.2 million on this property during the year ended December 31, 2015. $5.9 million of the sales proceeds from this sale were held by a qualified intermediary, which is noncash and recorded in deferred charges, goodwill and other assets as of September 30, 2017. See Note 5: Deferred Charges, Goodwill and Other Assets, Net.(g)$15.3 million of the sales proceeds from this sale were held by a qualified intermediary, which is noncash and recorded in deferred charges, goodwill and other assets as of September 30, 2017. See Note 5: Deferred Charges, Goodwill and Other Assets, Net.Rental Property Held for Sale, NetThe Companyparcel that was previously identified as held for sale six office properties totaling approximately 1.3 million square feetwas reclassified as held and used. As a result of September 30, 2017. The properties are locatedrecent sales contracts in Parsippany, Woodcliff Lake, Paramus and Rochelle Park, New Jersey. The total estimated sales proceeds fromplace, the sales are expected to be approximately $132 million. The Company determined that the carrying value of one office and three of the office properties wasland parcels held for sale were not expected to be recovered from estimated net sales proceeds, and accordingly, during the three and six months ended June 30, 2023, recognized an unrealized loss allowanceimpairment of $25.7$3.6 million asand $7.0 million, respectively.September 30, 2017.rental propertyreal estate held for sale, net, as of September 30, 2017: and other assets and liabilities (dollars in thousands)Other assets and liabilities related to the rental property held for sale,SeptemberJune 30, 2017, include $7.5 million in deferred charges, and other assets, $3.9 million in unbilled rents receivable and $3.1 million in accounts payable, accrued expenses and other liabilities. Approximately $10.7 million of these assets and $0.3 million of these liabilities are expected2023:Office
PortfolioOther Properties
Held for SaleTotal Land $ 5,327 $ 64,888 $ 70,215 Building & Other 92,097 10,853 102,950 Less: Accumulated depreciation (37,789) — (37,789) Less: Cumulative unrealized losses on property held for sale (8,070) (4,616) (12,686) Real estate held for sale, net $ 51,565 $ 71,125 $ 122,690 Other assets and liabilities Office
PortfolioOther Properties
Held for SaleTotal Unbilled rents receivable, net (a) $ 1,177 $ — $ 1,177 Deferred charges, net (a) 620 — 620 Accounts payable, accrued exp & other liability (1,564) (67) (1,631) Unearned rents/deferred rental income (a) (120) — (120) written offremoved with the completion of the sales.Rockpoint TransactionOn February 27, 2017,Disposition
DateProperty Location # of
Bldgs.Rentable
Square
FeetProperty
TypeNet
Sales
ProceedsNet
Carrying
ValueDiscontinued
Operations
Realized
Gains
(Losses)/
Unrealized
Losses, net02/10/23 XS Hotels Weehawken, New Jersey 2 — Hotel $ 93,358 (a) $ 92,578 $ 780 04/04/23 Harborside 1, 2 and 3 Jersey City, New Jersey 3 1,886,800 Office 362,446 362,304 142 Totals 5 1,886,800 $ 455,804 $ 454,882 $ 922 Disposition
DateProperty Location Net
Sales
ProceedsNet
Carrying
ValueRealized
Gains
(Losses)/
Unrealized
Losses, net03/17/23 Columbia-Honeywell Morris Township, New Jersey $ 8,214 (a) $ 8,236 $ (22) Totals $ 8,214 $ 8,236 $ (22) Roseland Residential Trust (“RRT”), the Company’s wholly-owned subsidiary through which the Company conducts its multi-family residential real estate operations, Roseland Residential, L.P. (“RRLP”), the operating partnership through which RRT conducts all of its operations,in December 2022 and certain other affiliates of the Company entered into an equity investment agreement (the “Investment Agreement”) with Rockpoint Group, L.L.C. and certain of its affiliates (collectively, “Rockpoint”). The Investment Agreement provides for multiple equity investments by Rockpoint in RRLP from time to time for up to an aggregate of $300 million of equity units of limited partnership interests of RRLP (the “Rockpoint Units”). The initial closing under the Investment Agreement occurred on March 10, 2017 for $150 million of Rockpoint Units. Additional closings of Rockpoint Units to be issued and sold to Rockpoint pursuant to the Investment Agreement may occur from time to time in increments of not less than $10 million per closing, with the balance of the full $300 million by March 1, 2019. See Note 14: Redeemable Noncontrolling Interests.RRLP has been identified as a variable interest entity in which the Company is deemed to be the primary beneficiary. As of September 30, 2017 and December 31, 2016, the Company’s consolidated RRLP entity had total assets of $1.8 billion and $1.3 billion, respectively, total mortgages & loan payable of $698.8 million and $480.7 million, respectively, and other liabilities of $87.3 million and $40.1 million, respectively.Unconsolidated Joint Venture ActivityOn January 31, 2017, the Company sold its interest in the KPG-P 100 IMW JV, LLC, Keystone-Penn and Keystone-Tristate joint ventures that own operating properties, located in Philadelphia, Pennsylvania for an aggregate sales price of $9.7 million and realized a gain on the sale of the unconsolidated joint venture of $7.4 million.On February 15, 2017, the Company sold its 7.5 percent interest in the Elmajo Urban Renewal Associates, LLC and Estuary Urban Renewal Unit B, LLC joint ventures that own operating multi-family properties located in Weehawken, New Jersey for a sales price of $5.1 million and realized a gain on the sale of the unconsolidated joint venture of $5.1 million.On September 21, 2017, the RoseGarden Monaco, L.L.C. joint venture agreement was terminated. Accordingly, the Company wrote off the carrying value of its investment in the joint venture and recorded a loss of $1.4 million on the disposition of its joint venture interest.On September 29, 2017, the Company sold its interests in the KPG-MCG Curtis joint venture that owns an operating property located in Philadelphia, Pennsylvania for a sales price of $102.5 million, which included the retirement of the Company’s share in a mortgage payable of $75 million, and realized a gain on the sale of the unconsolidated joint venture of $12 million. $8.9 million of the net sales proceeds from this sale were held by a qualified intermediary, which is considered non cash and recorded in deferred charges, goodwill and other assets. See Note 5: Deferred Charges, Goodwill and Other Assets, Net.SeptemberJune 30, 2017,2023, the Company had an aggregate investment of approximately $238.4$122.4 million in its equity method joint ventures. The Company formed these ventures with unaffiliated third parties, or acquired interests in them, to develop or manage primarily office and multi-family rental properties, or to acquire land in anticipation of possible development of office and multi-family rental properties. As of SeptemberJune 30, 2017,2023, the unconsolidated joint ventures owned: four officeseven multifamily properties totaling 2,146 apartment units, a retail property aggregating approximately 0.5 million51,000 square feet eight multi-family properties totaling 3,275 apartments, and two retail properties aggregating approximately 81,700 square feet, a 350-room hotel, a development project for up to approximately 59 apartments; and interests and/or rights to developable land parcels able to accommodate up to 3,998 apartments.82912.520 percent to 85 percent subject to specified priority allocations in certain of the joint ventures. Unless otherwise noted below, theSeptemberJune 30, 2017, such debt had a total facility amount of $206 million of which the Company agreed to guarantee up to $24.8 million. As of September 30, 2017,2023, the outstanding balance of such debt, subject to guarantees, totaled $194.2$18.2 million of which $23.3$2.0 million was guaranteed by the Company.$0.6$0.5 million and $0.9 million for such services in the three months ended SeptemberJune 30, 20172023 and 2016,2022, respectively. The Company had $0.7$0.6 million and $0.7$0.2 million in accounts receivable due from its unconsolidated joint ventures as of SeptemberJune 30, 20172023 and December 31, 2016,2022, respectively.Included inCompany’sCompany does not have any investments in unconsolidated joint ventures as of September 30, 2017that are three unconsolidated development joint ventures, which are VIEs for which the Company is not the primary beneficiary. These joint ventures are primarily established to develop real estate property for long-term investment and were deemed VIEs primarily based on the fact that the equity investment at risk was not sufficient to permit the entities to finance their activities without additional financial support. The initial equity contributed to these entities was not sufficient to fully finance the real estate construction as development costs are funded by the partners throughout the construction period. The Company determined that it was not the primary beneficiary of these VIEs based on the fact that the Company has shared control of these entities along with the entity’s partners and therefore does not have controlling financial interests in theseconsidered VIEs. The Company’s aggregate investment in these VIEs was approximately $114.2 million as of September 30, 2017. The Company’s maximum exposure to loss as a result of its involvement with these VIEs is estimated to be approximately $139.0 million, which includes the Company’s current investment and estimated future funding commitments/guarantees of approximately $24.8 million. The Company has not provided financial support to these VIEs that it was not previously contractually required to provide. In general, future costs of development not financed through third parties will be funded with capital contributions from the Company and its outside partners in accordance with their respective ownership percentages.Company’sCompany's unconsolidated joint ventures as of SeptemberJune 30, 20172023 and December 31, 2016: 2022 (dollars in thousands)Property Debt Entity / Property Name Number of
Apartment Units
or Rentable SFCompany's
Effective
Ownership % (a)Carrying Value As of June 30, 2023 Interest
RateJune 30,
2023December 31,
2022Balance Maturity
DateMultifamily Metropolitan and Lofts at
40 Park (b) (c)189 units 25.00 % $ 1,038 $ 1,747 $ 60,767 (d) (d) RiverTrace at Port Imperial 316 units 22.50 % 4,767 5,114 82,000 11/10/26 3.21 % Capstone at Port Imperial 360 units 40.00 % 22,505 23,234 135,000 12/22/24 SOFR+ 1.2 % Riverpark at Harrison 141 units 45.00 % — — 30,192 07/01/35 3.19 % Station House 378 units 50.00 % 32,365 32,372 90,447 07/01/33 4.82 % Urby at Harborside (e) 762 units 85.00 % 59,663 61,594 187,137 08/01/29 5.197 % PI North - Land (b) (f) 829 potential units 20.00 % 1,678 1,678 — — — Other (g) 419 419 — — — Totals: $ 122,435 $ 126,158 $ 585,543 Company’sCompany's effective ownership % represents the Company’sCompany's entitlement to residual distributions after payments of priority returns, where applicable.Company’sCompany's ownership interests in this venture are subordinate to its partner’spartner's preferred capital balance and the Company is not expected to meaningfully participate in the venture’sventure's cash flows in the near term.12.525 percent interest in a 50,973 square feet retail building (“("Shops at 40 Park”Park") and a 2550 percent interest in a to-be-built 59-unit, five story multi-familymultifamily rental development property (“("Lofts at 40 Park”Park").amortizableinterest only loan, collateralized by the Metropolitan at 40 Park, with a balance of $37,044,$36,500, bears interest at 3.25LIBOR +2.85 percent, matures in September 2020;October 2023; (ii) an amortizable loan, collateralized by the Shops at 40 Park, with a balance of $6,213, bears$6,067, with a fixed rate of 5.125%. On January 10, 2023, the loan was modified bearing interest at 3.63SOFR +2.00 percent and matures in August 2018. On February 3, 2017, the venture obtained a constructionJanuary 2025; (iii) an interest only loan, forcollateralized by the Lofts at 40 Park, with a balance of $6,337,$18,200, which bears interest at LIBOR plus 250 basis pointsSOFR +2.00 percent and maturesoriginally matured in February 2020.(e)On February 28, 2017, 9,122 Series A-1 Units were issued to the joint venture partner as noncash consideration for the partner’s approximate 13.8 percent ownership interest in the joint venture. In April 2017, the Company acquired the remaining joint venture interests and increased its ownership interest to 100 percent. See Note 3: Recent Transactions — Consolidation.(f)January 2023. The Company also owns a 50 percent interest in a vacant land to accommodate the development of approximately 295 additional units of which 252 are currently approved.(g)The Company also owns a 20 percent residual interest in undeveloped land parcels: parcels 6, I, and J that can accommodate the development of 836 apartment units.(h)The construction loan had a maximum borrowing amount of $77,400 and provided, subject to certain conditions, two one-year extension optionshas been extended with a feematurity date of 25 basis points for each year. On March 31, 2017, the Company exercised its first one-year extension option and concurrently the maximum borrowing amount was reduced to $75,000.(i)The construction/permanent loan has a maximum borrowing amount of $192,000. October 1, 2023.development project was placed in service in second quarter 2017.(j)Includes undivided interests in the same manner as investments in noncontrolling partnership, pursuant to ASC 970-323-25-12. On September 29,2017, the Company sold its equity interest to its joint venture partner, which included the retirementhad guaranteed $22 million of the Company’s shareprincipal outstanding debt. On February 1, 2023, the lender released the guarantor of all obligations under the Guaranty Agreement.debtdevelopment of $75 million. See Note 3: Recent Transactions - Unconsolidated Joint Venture Activity.(k)829 multifamily units.Company’sCompany's operations in the near term.(l)On January 31, 2017, the Company sold its equity interest in the joint venture. See Note 3: Recent Transactions - Unconsolidated Joint Venture Activity.(m)On September 21, 2017, the joint venture agreement was terminated. Accordingly, the Company wrote off the carrying value of its investment in the joint venture and recorded a loss of $1.4 million on the disposition of its joint venture interest.(n)On February 3, 2017, the Company acquired the equity interest of its partner. See Note 3: Recent Transactions - Consolidation.(o)On February 15, 2017, the Company sold its 7.5 percent interest in Elmajo Urban Renewal Associates, LLC and Estuary Urban Renewal Unit B, LLC joint ventures that own operating multi-family properties, located in Weehawken, New Jersey for a combined sales price of $5.1 million.ninesix months ended SeptemberJune 30, 20172023 and 2016:2022, respectively (dollars in thousands)Three Months Ended
June 30,Six Months Ended
June 30,Entity / Property Name 2023 2022 2023 2022 Multifamily Metropolitan and Lofts at 40 Park $ (326) $ (95) $ (608) $ (233) RiverTrace at Port Imperial 144 80 282 147 Capstone at Port Imperial (126) 23 (313) 49 Riverpark at Harrison 67 45 405 45 Station House 91 (96) (7) (455) Urby at Harborside 2,906 2,793 2,973 2,768 PI North - Land (56) (102) (96) (173) Liberty Landing — (10) (3) (10) Other Other — — — 13 Company's equity in earnings of unconsolidated joint ventures (a) $ 2,700 $ 2,638 $ 2,633 $ 2,151 (dollars in thousands) June 30,
2023December 31,
2022Assets: Rental Property, net $ 736,427 $ 745,210 Other assets 32,786 39,241 Total assets $ 769,213 $ 784,451 Liabilities and partners'/members' capital: Mortgages and loans payable $ 585,543 $ 587,913 Other liabilities 9,325 15,545 Partners'/members' capital 174,345 180,993 Total liabilities and partners'/members' capital $ 769,213 $ 784,451 Three Months Ended
June 30,Six Months Ended
June 30,2023 2022 2023 2022 Total revenues $ 25,945 $ 41,345 $ 47,770 $ 77,472 Operating and other expenses (8,698) (22,317) (17,142) (47,816) Depreciation and amortization (5,572) (6,381) (11,137) (12,941) Interest expense (7,762) (7,051) (15,475) (13,827) Net income $ 3,913 $ 5,596 $ 4,016 $ 2,888 GOODWILL AND OTHER ASSETS, NET(dollars in thousands) June 30,
2023December 31,
2022Deferred leasing costs $ 11,487 $ 59,651 Deferred financing costs - revolving credit facility (a) — 6,684 11,487 66,335 Accumulated amortization (7,314) (30,471) Deferred charges, net 4,173 35,864 Notes receivable (b) 78 1,309 In-place lease values, related intangibles and other assets, net (c) 10,554 12,298 Right of use assets (c) 6,645 2,238 Prepaid expenses and other assets, net 37,511 44,453 Total deferred charges and other assets, net $ 58,961 $ 96,162 Pursuant to recently issued accounting standards, deferredDeferred financing costs related to all other debt liabilities (other than for the unsecured revolving credit facility) are netted against those debt liabilities for all periods presented. See Note 2:2 to the Company's 2022 10-K: Significant Accounting Policies —– Deferred Financing Costs. Includes asAs of September 30, 2017, a mortgage receivable with a balance of $45.1 million (acquired in August 2017) which bears interest at 5.85 percent and matures in July 2019 with a three-month extension option; mortgages receivable for $40.2 million (provided to buyers in connection with property sales in August 2017) which bear interest at 4.0 percent and mature in November 2017; mortgages receivable for $24.8 million (provided to buyers in connection with property sales in August 2017) which bear interest at rates of 5.0 and 7.0 percent and mature in November 2017, with three 30-day extension options; andDecember 31, 2022, included an interest-free note receivable with a net present value of $2.6$0.2 million which maturesmatured in April 2023. TheAlso included $1.0 million, net of a loan loss allowance of $26.0 thousand, as of December 31, 2022, of seller-financing provided by the Company believes these balances are fully collectible.(c) All goodwill is attributable to the Company’s Multi-family Services segment.(d) Includes $45.3buyers of the Metropark portfolio, which matured in May 2023. The receivable was secured against available cash of one of the Metropark properties disposed of and earned an annual return of four percent for 90 days after the disposition, with the interest rate increased to 15 percent through November 18, 2021 and to 10 percent thereafter, pursuant to an amended operating agreement.of proceeds from property sales held by a qualified intermediaryand 3.2 million as of SeptemberJune 30, 2017. to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps and caps as part of its interest rate risk management strategy. As of September 30, 2017, the Company had outstanding interestInterest rate swaps with a combined notional value of $675 million that were designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. Interest rate caps designated as cash flow hedges involve the receipt of variable amounts from a counterparty if interest rates rise above the strike rate risk. Duringon the nine months ending September 30, 2017, such derivatives were used to hedge the variable cash flows associated with existing variable-rate debt. effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges isare recorded in accumulated other comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecasted The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. During the three months ended September 30, 2017 and 2016, respectively, the company recorded ineffectiveness gain (loss) of $6,000 and $1,012,000 and during the nine months ended September 30, 2017 and 2016, respectively, the Company recorded ineffectiveness gain (loss) of $(26,000) and $1,012,000, respectively, which is included in interest and other investment income (loss) in the consolidated statements of operations, attributable to a floor mismatch in the underlying indices of the derivatives and the hedged interest payments made on its variable-rate debt. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on the Company’s variable-rate debt. During the next 12 months, the Company estimates that an additional $0.6$6.4 million will be reclassified as an increasea decrease to interest expense.Undesignated Cash Flow HedgesInterest Rate RiskInterestJune 30, 2023, the Company had four interest rate caps notoutstanding with a notional amount of $548 million designated as cash flow hedges are not speculative and are used to manage the Company’s exposure toof interest rate movements but do not meet the strict hedge accounting requirements. Changes in the fair value of derivatives not designated in hedging relationships are recorded directly in earnings. The Company recognized no expenses for the three months ended September 30, 2017 and 2016, respectively, and zero and $2,000 for the nine months ended September 30, 2017 and 2016, respectively, which is included in interest and other investment income (loss) in the consolidated statements of operations.Balance Sheetconsolidated balance sheets as of SeptemberJune 30, 20172023 and December 31, 2016. (dollars2022 (dollars in thousands)Asset Derivatives designated
as hedging instrumentsBalance sheet location June 30,
2023December 31,
2022Interest rate caps $ 8,038 $ 9,808 Deferred charges and other assets Income StatementConsolidated Statements of Operations for the three and ninesix months ending Septemberended June 30, 20172023 and 2016. 2022, respectively (dollars in thousands)
(Loss) Recognized in
OCI on Derivative
(Effective Portion)
(Loss) Reclassified from
Accumulated OCI into
Income (Effective
Portion)
(Loss) Reclassified from
Accumulated OCI into
Income (Effective
Portion)
(Loss) Recognized in
Income on Derivative
(Ineffective Portion and
Amount Excluded from
Effectiveness Testing)
(Loss) Recognized in
Income on Derivative
(Ineffective Portion,
Reclassification for
Forecasted Transactions
No Longer Probable of
Occurring and Amount
Excluded from
Effectiveness Testing)Derivatives in Cash Flow Hedging Relationships Amount of Gain or (Loss) Recognized in OCI on Derivative Location of Gain or (Loss) Reclassified from Accumulated OCI into Income Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income Total Amount of Interest Expense presented in the consolidated statements of operations Three months ended June 30, 2023 2022 2023 2022 2023 2022 Interest Rate Caps $ 2,221 $ (60) Interest expense $ 685 $ — $ (21,692) $ (17,707) Six months ended June 30, Interest Rate Caps $ 1,697 $ 2,124 Interest expense $ 1,106 $ 2 $ (43,706) $ (32,733) The Company has agreements with eachits derivative counterparties that contain a provision whereJune 30, 2023, the Company could be declared in default on its derivative obligations if repayment of the underlying indebtedness is accelerated by the lender due to the Company’s default on the indebtedness. As of September 30, 2017, the fair value ofdid not have any interest rate derivatives in a net liability position, which includes accrued interest but excludes any adjustment for nonperformance risk, related to these agreements was $4,000. As of September 30, 2017, the Company has not posted any collateral related to these agreements. If the Company had breached any of these provisions at September 30, 2017, it could have been required to settle its obligations under the agreements at their termination value of $4,000.following: following (dollars in thousands)June 30,
2023December 31,
2022Security deposits $ 10,009 $ 9,175 Escrow and other reserve funds 17,605 11,692 Total restricted cash $ 27,614 $ 20,867 SENIOR UNSECURED NOTESA summaryCompany’s senior unsecured notes assales contract in place, the Company determined that the carrying value of September 30, 2017this held for sale property was not expected to be recovered from2016 is2022, recognized an unrealized held for sale loss allowance of $4.4 million.follows: discontinued operations several waterfront office properties totaling approximately 3.9 million square feet, which are located in Jersey City and Hoboken, New Jersey. In addition, the hotels sold were also classified as discontinued operations.Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Total revenues $ 2,685 $ 27,557 $ 19,333 $ 77,157 Operating and other expenses (2,270) (11,769) (10,773) (23,449) Depreciation and amortization (275) (7,014) (5,382) (15,086) Interest expense — (2,966) (822) (6,385) Income from discontinued operations 140 5,808 2,356 32,237 Loss from extinguishment of debt, net — — (12) (6,289) Realized loss on disposition of rental property (3,488) (4,440) (2,709) (2,604) Realized loss, net (3,488) (4,440) (2,721) (8,893) Total discontinued operations, net $ (3,348) $ 1,368 $ (365) $ 23,344 (1) Includes the cost of terminated treasury lock agreements (if any), offering and other transaction costs and the discount/premium on the notes, as applicable.The terms of the Company’s senior unsecured notes include certain restrictions and covenants which require compliance with financial ratios relating to the maximum amount of debt leverage, the maximum amount of secured indebtedness, the minimum amount of debt service coverage and the maximum amount of unsecured debt as a percent of unsecured assets. The Company was in compliance with its debt covenants under the indenture relating to its senior unsecured notes as of September 30, 2017.UNSECURED REVOLVING CREDIT FACILITY AND TERM LOANSJanuary 25, 2017,May 6, 2021, the Company entered into an amendeda revolving credit facility and new term loan agreement (“20172021 Credit Agreement”) with a group of 13 lenders. Pursuant to the 2017 Credit Agreement, the Company refinanced its existing $600seven lenders that provided for a $250 million unsecuredsenior secured revolving credit facility (“2017(the “2021 Credit Facility”) and a $150 million senior secured term loan facility (the “2021 Term Loan”), and terminated the 2017 credit agreement on May 13, 2021.new $325revolving credit and term loan agreement (“2023 Credit Agreement”) with a group of two lenders that provides for a $60 million unsecured, delayed-drawsenior secured revolving credit facility (the “2023 Revolving Credit Facility”) and a $115 million senior secured term loan facility (“2017(the “2023 Term Loan”).20172023 Revolving Credit Facility include: (1) a four-yearone-year term ending in January 2021, with twoJuly 2024, subject to one six-month extension options;option; (2) revolving credit loans may be made to the Company in an aggregate principal amount of up to $600 million (subject to increase as discussed below), with$60 million; (3) a sublimit under the 2017 Credit Facility for the issuance of letters of credit in an amount not to exceed $60 million (subject to increase as discussed below); (3) an interest rate basedfirst priority lien on the Operating Partnership’s unsecured debt ratings fromMoody’s or S&P, currently the London Inter-Bank Offered Rate (“LIBOR”) plus 120 basis points, or,unencumbered property known as The James, a 240 unit multi-family residential property located at the Operating Partnership’s option, if it no longer maintains a debt rating from Moody’s or S&P or such debt ratings fall below Baa3 and BBB-, based on a defined leverage ratio;87 Madison Avenue, Park Ridge, New Jersey (the “Collateral Pool Property”); and (4) a facilitycommitment fee payable quarterly basedequal to 35 basis points per annum on the Operating Partnership’s unsecured debt ratings from Moody’s or S&P, currently 25 basis points, or, atdaily unused amount of the Operating Partnership’s option, if it no longer maintains a debt rating from Moody’s or S&P or such debt ratings fall below Baa3 and BBB-, based on a defined leverage ratio.The interest rates on outstanding borrowings, alternate base rate loans and the facility fee on the current borrowing capacity payable quarterly in arrears on the 20172023 Revolving Credit Facility are based upon the Operating Partnership’s unsecured debt ratings, as follows:If the Company elected to use the defined leverage ratio, the interest rate under the 2017 Credit Facility would be based on the following total leverage ratio grid:20172023 Term Loan include:included: (1) a three-yearone-year term ending in January 2020, with two one-yearJuly 2024, subject to one six-month extension options;option; (2) multiple drawsa single draw of the term loan commitments may be made within 12 months of the effective date of the 2017 Credit Agreement up to an aggregate principal amount of $325 million (subject to increase as discussed below), with no requirement to be drawn$115 million; and (3) a first priority lien in full; provided, that, if the Company does not borrow at least 50 percent of the initial term commitment from the term lenders (i.e. 50 percent of $325 million) on or before July 25, 2017, the amount of unused term loan commitments shall be reduced on such date so that, after giving effect to such reduction, the amount of unused term loan commitments is not greater than the outstanding term loans on such date; (3) an interest rate based on the Operating Partnership’s unsecured debt ratings from Moody’s or S&P, currently the LIBOR plus 140 basis points, or, at the Operating Partnership’s option if it no longer maintains a debt rating from Moody’s or S&P or such debt ratings fall below Baa3 and BBB-, based on a defined leverage ratio; and (4) a term commitment fee on any unused term loan commitment during the first 12 months after the effective date of the 2017 Credit Agreement at a rate of 0.25 percent per annum on the sum of the average daily unused portion of the aggregate term loan commitments.On March 22, 2017, the Company drew the full $325 million available under the 2017 Term Loan. On March 29, 2017, the Company executed interest rate swap arrangements to fix LIBOR with an aggregate average rate of 1.6473% for the swaps and a current aggregate fixed rate of 3.0473%Collateral Pool Property.2017 Term Loan.On up to four occasions at any time after the effective date of the 2017 Credit Agreement, the Company may elect to request (1) an increase to the existing revolving credit commitments (any such increase, the “New2023 Revolving Credit Commitments”Facility and the 2023 Term Loan shall be based on applicable interest rate (the “Interest Rate”) and/or (2)plus a margin ranging from 250 basis points to 350 basis points (the “Applicable Margin”) depending on the establishment of one or more new term loan commitments (the “New Term Commitments”, together with the 2017 Credit Commitments, the “Incremental Commitments”), by upInterest Rate elected, currently 3.5%. With respect to an aggregate amount not to exceed $350 million for all Incremental Commitments. The Company may also request that the sublimit for letters of credit available under the 2017 Credit Facility be increased to $100 million (without arranging any New Revolving Credit Commitments). No lender or letter of credit issued has any obligation to accept any Incremental Commitment or any increase to the letter of credit subfacility. There is no premium or penalty associated with full or partial prepayment of borrowings under the 2017 Credit Agreement.The 2017 Credit Agreement, which applies to both the 20172023 Revolving Credit Facility and 2017the 2023 Term Loan, includesthe Interest Rate shall be either (A) the Alternative Base Rate plus the Applicable Margin and/or (B) the Adjusted Term SOFR Rate plus the Applicable Margin or, with respect to the 2023 Revolving Credit Facility only, (C) the Adjusted Daily Effective SOFR Rate plus the Applicable Margin. As used herein: “Alternative Base Rate” means, subject to a floor of 1.00%, the highest of (i) the rate of interest last quoted by The Wall Street Journal in the U.S. as the prime rate in effect (the “Prime Rate”), (ii) the NYFRB Rate from time to time plus 0.5% and (iii) the Adjusted Term SOFR Rate for a one month interest period plus 1%; “Adjusted Term SOFR Rate” means, subject to a floor of 0.0%, the Term SOFR Rate , plus 10 basis points; and “Adjusted Daily Effective SOFR Rate” means, subject to a floor of 0.0%, for any day, the secured overnight financing rate for such business day published by the NYFRB on the NYFRB’s on the immediately succeeding business day (“SOFR”) plus 10 basis points.restrictions and covenants which limit, among other things the incurrence of additional indebtedness, the incurrence of liens and the disposition of realestate properties (to the extent that: (i) such property dispositions cause the Company to default on anysubsidiaries of the financial ratiosOperating Partnership are the guarantors of the 2017obligations of the Operating Partnership under the 2023 Credit Agreement, (described below), or (ii)and certain subsidiaries of the property dispositions are completed whileOperating Partnership also granted the Company is under an eventlenders a security interest in certain subsidiary guarantors in order to further secure the obligations, liabilities and indebtedness of defaultthe Operating Partnership under the 20172023 Credit Agreement.unless, under certain circumstances, such disposition is being carried out to cure such default), and which require compliance with financial ratios relating to the maximum leverage ratio (60 percent), the maximum amount of secured indebtedness (40 percent), the minimum amount of fixed charge coverage (1.5 times), the maximum amount of unsecured indebtedness (60 percent), the minimum amount of unencumbered property interest coverage (2.0 times) and certain investment limitations (generally 15 percent of total capitalization). If an event of default has occurred and is continuing, the entire outstanding balance under the 2017 Credit Agreement may (or, in the case of any bankruptcy event of default, shall) become immediately due and payable, and the Company will not make any excess distributions except to enable the General Partner to continue to qualify as a REIT under the IRS Code.Before it amended and restated its unsecured revolving credit facility in January 2017, the Company had a $600 million unsecured revolving credit facility with a group of 17 lenders that was scheduled to mature in July 2017. The interest rate on outstanding borrowings (not electing the Company’s competitive bid feature) and the facility fee on the current borrowing capacity payable quarterly in arrears was based upon the Operating Partnership’s unsecured debt ratings at the time, as follows:In January 2016, the Company obtained a $350 million unsecured term loan (“2016 Term Loan”), which matures in January 2019 with two one-year extension options. The interest rate for the term loan is currently 140 basis points over LIBOR, subject to adjustment on a sliding scale based on the Operating Partnership’s unsecured debt ratings, or, at the Company’s option, a defined leverage ratio. The Company entered into interest rate swap arrangements to fix LIBOR for the duration of the term loan. Including costs, the current all-in fixed rate is 3.13 percent. The proceeds from the loan were used primarily to repay outstanding borrowings on the Company’s then existing unsecured revolving credit facility and to repay $200 million senior unsecured notes that matured on January 15, 2016.The interest rate on the 2016 Term Loan is based upon the Operating Partnership’s unsecured debt ratings, as follows:Operating Partnership’sInterest Rate -Unsecured Debt Ratings:Applicable Basis PointsHigher of S&P or Moody’sAbove LIBORNo ratings or less than BBB-/Baa3185.0BBB- or Baa3 (current interest rate based on Company’s election)140.0BBB or Baa2115.0BBB+ or Baa1100.0A- or A3 or higher90.0If the Company elected to use the defined leverage ratio, the interest rate under the 2016 Term Loan would be based on the following total leverage ratio grid:Interest Rate -Applicable BasisTotal Leverage RatioPoints above LIBOR<45%145.0>45% and <50% (current ratio)155.0>50% and <55%165.0>55%195.0The terms of the 2016 Term Loan includeincludes certain restrictions and covenants which limit, among other things the incurrence of additional indebtedness, the incurrence of liens and the disposition of real estate properties, (to the extent that: (i) such property dispositions cause the Company to default on any of the financial ratios of the term loan described below, or (ii) the property dispositions are completed while the Company is under an event of default under the term loan, unless, under certain circumstances, such disposition is being carried out to cure such default), and which require compliance with financial ratios relating to (a) the maximum(60(65 percent), (b) the minimum debt service coverage ratio (1.25 times), (c) the minimum tangible net worth ratio (80% of tangible net worth as of July 25, 2023 plus 80% of net cash proceeds of equity issuances by the General Partner or the Operating Partnership), and (d) the maximum amountunhedged variable rate debt ratio (30%). Subject to certain exceptions, the net proceeds from any property sales are to be used to mandatorily repay the 2023 Term Loan until it is retired. In addition, the 2023 Credit Agreement includes a mandatory cash sweep provision that provides that any cash, cash equivalents or marketable securities of secured indebtedness (40 percent), the minimum amountGeneral Partner or Operating Partnership in excess of fixed charge coverage (1.5 times),$25 million as of the maximum amountend of unsecured indebtedness (60 percent), the minimum amountlast business day of unencumbered property interest coverage (2.0 times)any calendar week shall be applied to repayment of any outstanding borrowings under the 2023 Credit Agreement.certain investment limitations (generally 15 percentrequire the immediate repayment of total capitalization).all outstanding borrowings under the 2023 Revolving Credit Facility. These change of control provisions, which have been an event of default under the agreements governing the Operating Partnership’s revolving credit facilities since June 2000, are triggered if, among other things, a majority of the seats on the Board of Directors (other than vacant seats) become occupied by directors who were neither nominated by the Board of Directors, nor appointed by the Board of Directors. If these change of control provisions were triggered, the Operating Partnership could seek a forbearance, waiver or amendment of the change of control provisions from the lenders, however there can be no assurance that the Operating Partnership would be able to obtain such forbearance, waiver or amendment on acceptable terms or at all. If an event of default has occurred and is continuing, the Companyentire outstanding balance under the 2023 Credit Agreement may (or, in the case of any bankruptcy event of default, shall) become immediately due and payable, and the Operating Partnership will not make any excess distributions except to enable the General Partner to continue to qualify as a REIT under the IRS Code.The Company was in compliance with its debt covenantsits unsecured revolving credit facilitythe 2023 Term Loan and term loans as of September 30, 2017.As of September 30, 2017 and December 31, 2016, the Company’s unsecured credit facility and term loans totaled $671.8 million and $634.1 million, respectively, comprised of: $348.8borrowed $52 million from the 2016 Term Loan (net2023 Revolving Credit Facility which proceeds, together with available cash, were used to fund the purchase price under the Rockpoint Purchase Agreement in Part II, Item 5. On July 26, 2023, the Company paid down a total of unamortized deferred financing costs of $1.2 million) and $323 million from the 2017 Term Loan (net of unamortized deferred financing costs of $2 million) as of September 30, 2017; and $286$27 million of borrowings under its unsecured revolving credit facility and $348.1 million from the 2016 Term Loan (net of unamortized deferred costs of $1.9 million) as of December 31, 2016.SeptemberJune 30, 2017, 142023, 16 of the Company’s properties, with a total carrying value of approximately $1.6$2.6 billion, and five of the Company’s land and development projects, with a total carrying value of approximately $375 million, are encumbered by the Company’sCompany's mortgages and loans payable. Payments on mortgages, loans payable and other obligations are generally due in monthly installments of principal and interest, or interest only. The Company was in compliance with its debt covenants under its mortgages and loans payable as of SeptemberJune 30, 2017.SeptemberJune 30, 20172023 and December 31, 20162022 is as follows: follows (dollars in thousands)Property/Project Name Lender June 30,
2023 December 31,
2022 Maturity Port Imperial 4/5 Hotel (b) Fifth Third Bank N/A $ — $ 84,000 — Portside at Pier One CBRE Capital Markets/FreddieMac 3.57 % 58,998 58,998 08/01/23 Signature Place Nationwide Life Insurance Company 3.74 % 43,000 43,000 08/01/24 Liberty Towers American General Life Insurance Company 3.37 % 265,000 265,000 10/01/24 Haus25 (c) QuadReal Finance SOFR+ 2.70 % 297,324 297,324 12/01/24 Portside 5/6 (d) New York Life Insurance Company 4.56 % 97,000 97,000 03/10/26 BLVD 425 New York Life Insurance Company 4.17 % 131,000 131,000 08/10/26 BLVD 401 New York Life Insurance Company 4.29 % 117,000 117,000 08/10/26 The Upton (e) Bank of New York Mellon SOFR+ 1.58 % 75,000 75,000 10/27/26 145 Front at City Square (f) MUFG Union Bank SOFR+ 1.84 % 63,000 63,000 12/10/26 Riverhouse 9 at Port Imperial (g) JP Morgan SOFR+ 1.41 % 110,000 110,000 06/21/27 Quarry Place at Tuckahoe Natixis Real Estate Capital LLC 4.48 % 41,000 41,000 08/05/27 BLVD 475 N/S The Northwestern Mutual Life Insurance Co. 2.91 % 165,000 165,000 11/10/27 Riverhouse 11 at Port Imperial The Northwestern Mutual Life Insurance Co. 4.52 % 100,000 100,000 01/10/29 Soho Lofts (h) New York Community Bank 3.77 % 160,000 160,000 07/01/29 Port Imperial South 4/5 Garage American General Life & A/G PC 4.85 % 31,908 32,166 12/01/29 Emery at Overlook Ridge New York Community Bank 3.21 % 72,000 72,000 01/01/31 Principal balance outstanding 1,827,230 1,911,488 Unamortized deferred financing costs (6,249) (7,511) Total mortgages, loans payable and other obligations, net $ 1,820,981 $ 1,903,977 Company owned a 50 percent tenants-in-common interest inloan was paid off on disposition of the Curtis Center property. On September 29, 2017, the Company sold its equity interest to its joint venture partner, which included the retirement of this $75 million loan balance.$94 million. This construction loanThe Company has guaranteed 10 percent of the outstanding principal, subject to certain conditions.maximum borrowing capacity of $48 million.(e) Mortgage is collateralized by the three properties comprising One River Center. (f) This construction loan has a maximum borrowing capacity of $42 million.(g) This construction loan has a maximum borrowing capacity of $73 million.(h) This construction loan has a maximum borrowing capacity of $78 million.(i) This construction loan has a maximum borrowing capacity of $58 million.(j) This$75 million mortgage loan which includes unamortized fair value adjustment of $5.4 million as of September 30, 2017, was assumed byand entered into an interest-rate cap agreement for the mortgage loan.in April 2017 withentered into an interest-rate cap agreement for the consolidation of allmortgage loan.interests in Monaco Towers.(k) ThisCompany obtained a $110 million mortgage loan was obtained byand entered into an interest-rate cap agreement for the Company in March 2017 to partially fundmortgage loan.acquisitionfirst five years of the Short Hills/Madison portfolio.CASH PAID FOR INTEREST AND INTEREST CAPITALIZEDninesix months ended SeptemberJune 30, 20172023 and 20162022 was $70,114,000$40.1 million and $89,617,000,$37.0 million (of which $1.1 million and $7.8 million pertained to properties classified as discontinued operations), respectively. Interest capitalized by the Company for the ninesix months ended SeptemberJune 30, 20172023 and 20162022 was $13,955,000zero and $14,436,000, respectively (which amounts included $1,009,000 and $3,937,000 for the nine months ended September 30, 2017 and 2016, respectively,$10.5 million, respectively.interest capitalized on the Company’s investments in unconsolidated joint ventures which were substantially in development).SUMMARY OF INDEBTEDNESS(dollars in thousands) June 30,
2023December 31,
2022 Balance Weighted Average
Interest RateBalance Fixed Rate & Hedged Debt (a) $ 1,820,981 4.32 % $ 1,757,308 4.27 % Other Variable Rate Debt — — % 146,669 6.86 % Totals/Weighted Average: $ 1,820,981 4.32 % $ 1,903,977 4.47 % SeptemberJune 30, 2017, the Company’s total indebtedness of $2,856,676,000 (weighted average2023 and December 31, 2022, includes debt with interest rate caps outstanding with a notional amount of 3.87 percent) was comprised of $224,357,000 of variable rate mortgage debt (weighted average rate of 3.84 percent)$548 million and fixed rate debt and other obligations of $2,632,320,000 (weighted average rate of 3.87 percent).As of December 31, 2016, the Company’s total indebtedness of $2,357,055,000 (weighted average interest rate of 3.79 percent) was comprised of $481,282,000 of unsecured revolving credit facility borrowings and other variable rate mortgage debt (weighted average rate of 2.93 percent) and fixed rate debt and other obligations of $1,875,773,000 (weighted average rate of 4.01 percent).Mack-Cali Realty CorporationVeris Residential, Inc. 401(k) Savings/Retirement Plan (the “401(k) Plan”). Eligible employees may elect to defer from one percent up to 60 percent of their annual compensation on a pre-tax basis to the 401(k) Plan, subject to certain limitations imposed by federal law. The amounts contributed by employees are immediately vested and non-forfeitable. The Company may make discretionary matching or profit sharing contributions to the 401(k) Plan on behalf of eligible participants in any plan year. Participants are always 100 percent vested in their pre-tax contributions and will begin vesting in any matching or profit sharing contributions made on their behalf after two years of service with the Company at a rate of 20 percent per year, becoming 100 percent vested after a total of six years of service with the Company. All contributions are allocated as a percentage of compensation of the eligible participants for the Plan year. The assets of the 401(k) Plan are held in trust and a separate account is established for each participant. A participant may receive a distribution of his or her vested account balance in the 401(k) Plan in a single sum or in installment payments upon his or her termination of service with the Company. Total expense recognized by the Company for the 401(k) Plan for the three months ended SeptemberJune 30, 20172023 and 20162022 was $246,000$129 thousand and $254,000,$148 thousand, respectively and $821,000$277 thousand and $746,000$330 thousand for the ninesix months ended SeptemberJune 30, 20172023 and 2016,2022, respectively.SeptemberJune 30, 20172023 and December 31, 2016.2022. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts.SeptemberJune 30, 20172023 and December 31, 2016.senior unsecured notes, unsecured term loans, an unsecured revolving credit facility and mortgages, loans payable and other obligations aggregated approximately $2,825,816,000$1.7 billion and $2,308,488,000$1.8 billion as compared to the book value of approximately $2,839,186,000$1.8 billion and $2,340,009,000$1.9 billion as of SeptemberJune 30, 20172023 and December 31, 2016,2022, respectively. The fair value of the Company’s long-term debt was categorized as avalued using level 3 basisinputs (as provided by ASC 820, Fair Value Measurements and Disclosures). The fair value was estimated using a discounted cash flow analysis valuation based on the borrowing rates currently available to the Company for loans with similar terms and maturities. The fair value of the mortgage debt and the unsecured notes was determined by discounting the future contractual interest and principal payments by a market rate. Although the Company has determined that the majority of the inputs used to value its derivative financial instruments fall within level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivative financial instruments utilize level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by itself and its counterparties. The Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its derivative financial instruments. As a result, the Company has determined that its derivative financial instruments valuations in their entirety are classified in level 2 of the fair value hierarchy.inputs. Examples of inputsassumptions. Assumptions that were utilized in the fair value calculations include, estimated holding periods,but are not limited to, discount rates, market capitalization rates, expected lease rental rates, room rental and third partyfood and beverage revenue rates, third-party broker information. information and information from potential buyers, as applicable.rental propertyreal estate identified as held for sale are based on estimated sale prices, net of estimated selling costs, of such property,property. In the absence of an executed sales agreement with a set sales price, management’s estimate of the net sales price may be based on signeda number of unobservable assumptions, including, but not limited to, the Company’s estimates of future cash flows, market capitalization rates and discount rates, if applicable. For developable land, an estimated per-unit market value assumption is also considered based on development rights or plans for the land.agreements.SeptemberJune 30, 20172023 and December 31, 2016. Although management is not aware of any factors that would significantly affect the fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since September 2022. 2017 and current estimates of fair value may differ significantly from the amounts presented herein.PILOT Payments Three PILOT Payments Six Property Name Location Asset Type PILOT
Expiration DatesMonths Ended
June 30,Months Ended
June 30,2023 2022 2023 2022 (Dollars in Thousands) (Dollars in Thousands) 111 River Street (a) Hoboken, NJ Office 4/2022 $ — $ — $ — $ 85 Harborside Plaza 4A (b) Jersey City, NJ Office 2/2022 — — — 218 Harborside Plaza 5 (c) Jersey City, NJ Office 6/2022 — 1,109 — 2,217 BLVD 401 (Marbella 2) (d) Jersey City, NJ Multifamily 4/2026 461 376 864 735 RiverHouse 11 at Port Imperial (e) Weehawken, NJ Multifamily 7/2033 405 356 779 706 Port Imperial 4/5 Hotel (f) Weehawken, NJ Hotel 12/2033 — 733 224 1,466 RiverHouse 9 at Port Imperial (g) Weehawken, NJ Multifamily 6/2046 372 318 754 640 Haus25 (h) Jersey City, NJ Mixed-Use 3/2047 573 124 1,147 124 The James (i) Park Ridge, NJ Multifamily 6/2051 144 — 287 — Total Pilot taxes $ 1,955 $ 3,016 $ 4,055 $ 6,191 Harborside Plaza 4-A agreement withproperty was disposed of in the Cityfirst quarter of Jersey City, as amended, which commenced in 2002, is for a term of 20 years. 2022.TotalThe total Project Costs are $49.5 million. The PILOT totaled $345,000 and $279,000 for the three months ended September 30, 2017 and 2016, respectively, and $1.0 million and $798,000 for the nine months ended September 30, 2017 and 2016, respectively.The Harborside Plaza 5 agreement, also with the City of Jersey City, as amended, which commenced in 2002, is for a term of 20 years. TotalThe total Project Costs are $170.9 million.totaled $1.2 millionis equal to ten percent of Gross Revenues for years 1-4, 12 percent for years 5-8 and $1.1 million14 percent for the three months ended September 30, 2017years 9-10, as defined.2016, respectively, and $3.8 million and $2.9 million14 percent for the nine months ended September 30, 2017 and 2016, respectively.The Port Imperial 4/5 Garage development project agreement with the City of Weehawken has a term of five years beginning when the project is substantially complete, which occurred in the third quarter of 2013. The agreement provides that real estate taxes be paid initially on the land value of the project only and allows for a phase in of real estate taxes on the value of the improvements at zero percent year one and 80 percent in years two through five.The Port Imperial South 1/3 Garage development project agreement with the City of Weehawken has a term of five years beginning when the project is substantially complete, which occurred in the fourth quarter of 2015. The agreement provides that real estate taxes be paid at 100 percent on the land value of the project only over the five year period and allows for a phase in of real estate taxes on the building improvement value at zero percent in year one and 95 percent in years two through five.The Port Imperial Hotel development project agreement with the City of Weehawken is for a term of 15 years following substantial completion, which is anticipated to be in the second quarter 2018. 11-15, as defined.Port Imperial Southproperty was disposed of during the first quarter of 2023.development project agreement with the Citypercent of Weehawken isGross Revenues for years 1-10, 12.5 percent for years 11-18 and 14 percent for years 19-25, as defined.1525 years following substantial completion, which occurred in April 2022. The annual PILOT is anticipatedequal to beseven percent of Gross Revenues, as defined.the first quarter 2018.July 2022. For a term of 30 years following substantial completion which occurred in June 2021. The annual PILOT is equal to 10 percent of Gross Revenues for years 1-10, 11.5 percent for years 11-21 and 12.5 percent for years 22-30, as defined.The 111 River Realty agreement with the City of Hoboken, which commenced on October 1, 2001 expires in April 2022. The PILOT payment equals $1,227,708 annually through April 2017 and then increases to $1,406,064 annually until expiration. The PILOT totaled $381,000 and $307,000 for the three months ended September 30, 2017 and 2016, respectively, and $995,000 and $307,000 for the nine months ended September 30, 2017 and 2016, respectively.The Monaco Towers agreement with the City of Jersey City, which commenced in 2011, is for a term of 10 years. The annual PILOT is equal to 10 percent of gross revenues, as defined. The PILOT totaled $558,000 for the three months ended September 30, 2017 and $1.1 million for the period from acquisition (April 2017) through September 30, 2017.SeptemberJune 30, 2017,2023 and December 31, 2022, are as follows: follows (dollars in thousands)GroundYear July 1 through December 31, 2023 $ 636 2024 1,272 2025 1,279 2026 1,279 2027 1,280 2028 through 2101 31,940 Total lease payments 37,686 Less: imputed interest (29,948) Total $ 7,738 Year 2023 $ 192 2024 192 2025 199 2026 199 2027 200 2028 through 2101 31,664 Total lease payments 32,646 Less: imputed interest (29,418) Total $ 3,228 expenseexpenses incurred by the Company amounted to $626,000$582 thousand and $538,000 during$214 thousand for the three months ended SeptemberJune 30, 20172023 and 2016,2022, respectively, and $1.8 million$847 thousand and $767,000$562 thousand for the ninesix months ended SeptemberJune 30, 20172023 and 2016, respectively.CONSTRUCTION PROJECTS2015,accordance with ASU 2016-02 (Topic 842), the Company commenced developmentcapitalized operating leases for one office and two ground leases, which had a total balance of $7.6 million at June 30, 2023. Such amount represents the net present value (“NPV”) of future payments detailed above. The weighted average incremental borrowing rate used to arrive at the NPV was 6.6 percent for the weighted average lease terms of 35.7 years years. These rates were arrived at by adjusting the fixed and floating rates of the Company’s mortgage debt with debt having terms approximating the remaining lease term of the Company’s office and ground leases and calculating notional rates for fully-collateralized loans.two-phase multi-family developmentlease liability and right-of-use asset in an amount of $4.7 million for the CitySquare projectoffice lease is a noncash activity.Worcester, Massachusetts. cash or Company stock at the employees’ option, contingent upon remaining with the Company in good standing until the occurrence of certain corporate transactions, which have not been identified.first phase, with 237 units,total potential cost of such awards is under construction with anticipated initial deliveries in the first quarter 2018. The second phase, with 128 units, started construction in the third quarter 2016 with anticipated initial deliveries in the third quarter 2018. Total development costs for both phases arecurrently estimated to be $92up to approximately $2.9 million, with development costsincluding the potential future issuance of $70.6 million incurred through September 30, 2017. The Company has a construction loan with a maximum borrowing amount of $58 million (with $27.8 million outstanding as of September 30, 2017). The Company does not expectup to fund additional costs for the completion of the project as future development costs will be funded by using the loan financings.In 2015, the Company entered into a 90-percent owned joint venture with XS Port Imperial Hotel, LLC to form XS Hotel Urban Renewal Associates LLC, which is developing a 372-key hotel in Weehawken, New Jersey. The project is expected to be ready for occupancy by second quarter 2018. The construction of the project is estimated to cost $139.4 million, with development costs of $87.6 million incurred by the venture through September 30, 2017. The venture has a $94 million construction loan (with $31 million outstanding as of September 30, 2017). The Company does not expect to fund additional costs for the completion of the project as future development costs will be funded by using the loan financing.In 2016, the Company commenced the repurposing of a former office property site in Morris Plains, New Jersey into a 197-unit multi-family development project. The project, which is estimated to cost $58.7 million of which development costs of $45 million have been incurred through September 30, 2017, is expected to be ready for occupancy by the first quarter of 2018. The remaining project costs are expected to be funded primarily from a $42 million construction loan (with $22.7 million outstanding as of September 30, 2017).In 2016, the Company started construction of a 296-unit multi-family project in East Boston, Massachusetts. The project is expected to be ready for occupancy by first quarter 2018 and is estimated to cost $111.4 million of which development costs of $81 million have been incurred through September 30, 2017. The remaining project costs are expected to be funded primarily from a $73 million construction loan (with $32 million outstanding as of September 30, 2017).The Company is developing a 295-unit multi-family project in Weehawken, New Jersey, which began construction in first quarter 2016. The project, which is expected to be ready for occupancy by first quarter 2018, is estimated to cost $125 million (of which development costs of $72.8 million have been incurred through September 30, 2017). The project costs are expected to be funded primarily from a $78 million construction loan (with $37.8 million outstanding as of September 30, 2017). The Company expects to fund $47 million for the development of the project, of which the Company has funded $34.4 million as of September 30, 2017.The Company is developing a 310-unit multi-family project in Conshohocken, Pennsylvania, which began construction in third quarter 2016 with anticipated initial occupancy in first quarter 2020. The project is estimated to cost $89.4 million (of which development costs of $22.9 million have been incurred through September 30, 2017). The project costs are expected to be funded primarily through borrowings under the Company’s unsecured revolving credit facility.OTHERThrough February 2016, the Company could not dispose of or distribute certain of its properties which were originally contributed by certain unrelated common unitholders of the Operating Partnership, without the express written consent of such common unitholders, as applicable, except in a manner which did not result in recognition of any built-in-gain (which may result in an income tax liability) or which reimbursed the appropriate specific common unitholders for the tax consequences of the recognition of such built-in-gains (collectively, the “Property Lock-Ups”). The aforementioned restrictions did not apply in the event that the Company sold all of its properties or in connection with a sale transaction which the General Partner’s Board of Directors determined was reasonably necessary to satisfy a material monetary default on any unsecured debt, judgment or liability of the Company or to cure any material monetary default on any mortgage secured by a property. The Property Lock-Ups expired in February 2016. Upon the expiration of the Property Lock-Ups, the Company is generally required to use commercially reasonable efforts to prevent any sale, transfer or other disposition of the subject properties from resulting in the recognition of built-in gain to the specific common unitholders, which include members of the Mack Group (which includes William L. Mack, Chairman of the General Partner’s Board of Directors; David S. Mack, director; and Earle I. Mack, a former director), the Robert Martin Group (which includes Robert F. Weinberg, a former director and current member of the General Partner’s Advisory Board), and the Cali Group (which includes John R. Cali, a former director and current member of the General Partner’s Advisory Board). As of September 30, 2017, 8342,095 shares of the Company’s properties, with an aggregate carrying value of approximately $1.0 billion, have lapsed restrictionscommon stock. Such cash or stock awards would only be earned and are subject to these conditions.On August 11, 2017, the Company acquired an existing mortgage note receivable encumbering a vacant developable land parcel located in Jersey City, New Jersey (the “Land Property”) with a current principal balance of $44,695,187 (the “Land Note Receivable”). The Land Note Receivable matures in July 2019payable if such transaction was identified and earns interest at an annual rate of 5.85 percent which accrues monthly and is payable at maturity. The Land Property is currently an unimproved land parcel which operates as a surface parking facility. Additionally, the Company entered into an agreement to acquire the Land Property, subjectcommunicated to the Company’s ability to obtainemployee within seven years of the agreement dates, most of which were signed in late 2020 and early 2021, and all necessary development rights and entitlements to develop an apartment building on the land, and other related conditions to ensure that the Company can develop the project. The purchase price is $73,000,000, subject to adjustment based on the level of development rights obtained for the construction of a multifamily apartment building.PropertiesCompany’s consolidated office properties are leased to tenants under operating leases with various expiration dates through 2035.2032. Substantially all of the commercial leases provide for annual base rents plus recoveries and escalation charges based upon the tenant’s proportionate share of and/or increases in real estate taxes and certain operating costs, as defined, and the pass-through of charges for electrical usage.SeptemberJune 30, 20172023 and December 31, 2022 are as follows (dollars in thousands):Multi-familyYear July 1 through December 31, 2023 $ 6,718 2024 12,084 2025 10,952 2026 8,822 2027 5,749 2028 and thereafter 7,795 Total $ 52,120 Year 2023 $ 14,618 2024 11,879 2025 10,535 2026 8,397 2027 5,315 2028 and thereafter 6,891 Total $ 57,635 RoselandVeris Residential Trust (“RRT”VRT”), the Company’s wholly-owned subsidiary through which the Company conducts its multi-familymultifamily residential real estate operations, RoselandVeris Residential Partners, L.P. (“RRLP”VRLP”), the operating partnership through which RRTVRT conducts all of its operations, and certain other affiliates of the Company entered into ana preferred equity investment agreement (the “Investment“Original Investment Agreement”) with certain affiliates of Rockpoint Group, L.L.C. (Rockpoint Group, L.L.C. and certain of its affiliates, (collectively,collectively, “Rockpoint”). The Original Investment Agreement providesprovided for VRT to contribute property to VRLP in exchange for common units of limited partnership interests in VRLP (the “Common Units”) and for multiple equity investments by Rockpoint in RRLPVRLP from time to time for up to an aggregate of $300 million of equitypreferred units of limited partnership interests of RRLPin VRLP (the “Rockpoint“Preferred Units”). The initial closing under the Original Investment Agreement occurred on March 10, 2017 for $150 million of RockpointPreferred Units and the parties agreed that the Company’s contributed equity value (“RRTVRT Contributed Equity Value”), was $1.23 billion at closing. Additional closingsDuring the year ended December 31, 2018, a total additional amount of Rockpoint$105 million of Preferred Units to bewere issued and sold to Rockpoint pursuant to the Original Investment Agreement. During the year ended December 31, 2019, a total additional amount of $45 million of Preferred Units were issued and sold to Rockpoint pursuant to the Original Investment Agreement, may occur from timewhich brought the Preferred Units to time in increments of not less than $10 million per closing, with the full balance of $300 million. In addition, certain contributions of property to VRLP by VRT subsequent to the full $300execution of the Original Investment Agreement resulted in VRT being issued approximately $46 million by March 1,of Preferred Units and Common Units in VRLP prior to June 26, 2019.participation right whereof first refusal to invest another $100 million in Preferred Units in the event VRT determines that VRLP requires additional capital prior to March 1, 20222023 and, following either the full investment of $300 million by Rockpoint or in certain other limited circumstances, the Companysubject thereto, VRLP may contributeissue up to $200approximately $154 million to obtain equity units on substantially the same terms and conditions as the Rockpointin Preferred Units to be issuedVRT or an affiliate so long as at the time of such funding VRT determines in good faith that VRLP has a valid business purpose to use such proceeds. Included in general and sold to Rockpoint.RRLPVRLP will be distributable to RRTRockpoint and RockpointVRT as follows:(and to the Company after it contributes to RRT to obtain equity units, as described above)and VRT on itstheir capital invested capital (“in Preferred Units (the “Preferred Base Return”);provideVRT and 4.64% to Rockpoint until VRT has received a 6% annual return (the “VRT Base Return”) on the equity value of the properties contributed by it to the partnership (“RRT Base Return”) withVRLP in exchange for Common Units (previously 95% of the RRT Base Return to RRT and 5% of, respectively, under the RRT Base ReturnOriginal Investment Agreement), subject to Rockpoint;adjustment in the event VRT contributes additional property to VRLP in the future; andbetweento Rockpoint (and the Company upon its contribution to obtain equity units) and RRTVRT based on total respective capital invested in and contributed equity value of Preferred Units and Common Units (based on Rockpoint’s $400 million of invested capital by Rockpoint and RRT Initial Capital Contribution.Based on Rockpoint’s $150 million invested capital and RRT’s Initial Capital Contribution, at SeptemberJune 30, 20172023, this pro rata distribution would be approximately 10.9%21.89% to Rockpoint in respect of Preferred Units, 2.65% to VRT in respect of Preferred Units and 89.1%75.46% to RRT.RRLP’sVRT in respect of Common Units).RRTRockpoint and RockpointVRT as follows:(and the Company after it contributes to RRT to obtain equity units)and VRT to the extent there is any unpaid, accrued Preferred Base Return;(andand to VRT in respect of Preferred Units;Company after it contributes to RRT to obtain equity units);third, to RRT to the extent there is any unpaid, accrued RRTVRT Base Return (within respect of Common Units (previously 95% and 5%, respectively, under the Original Investment Agreement), subject to adjustment in the event VRT contributes additional property to VRLP in the future;entitled to 5% of the amounts distributable to RRT);fourth, asuntil VRT has received a return of capital to RRT based on the equity value of the properties contributed by it to VRLP in exchange for Common Units (previously 95% and 5%,partnership (with Rockpoint entitledOriginal Investment Agreement), subject to 5%adjustment in the event VRT contributes additional property to the capital of VRLP in the amounts distributable to RRT);betweento Rockpoint (and the Company after it contributes to RRT to obtain equity units) and RRTVRT based on respective total respectivecapital invested capitalin and contributed equity value of Preferred and Common Units until Rockpoint has achievedreceived an 11% internal rate of return;return (based on Rockpoint’s $400 million of invested capital at June 30, 2023, this pro rata distribution would be approximately 21.89% to Rockpoint in respect of Preferred Units, 2.65% to VRT in respect of Preferred Units and(and to the Company after it contributes to RRT to obtain equity units)and VRT in respect of their Preferred Units based on 50% of itstheir pro rata shareshares described in “fifth” above and the balance to RRT.RRLPVRLP may not sell its properties in a taxable transaction,transactions, although it may engage in tax-deferred like-kind exchanges of properties or it may proceed in another manner designed to avoid the recognition of gainsgain for tax purposes.Beginning2022,2023 (the “Lockout Period”), Rockpoint’s interest in the Preferred Units cannot be redeemed or repurchased, except in certain limited circumstances as definedconnection with (a) a sale of all or substantially all of VRLP or a sale of a majority of the then-outstanding interests in VRLP, in each case, which sale is not approved by Rockpoint, or (b) a spin-out or initial public offering of common stock of VRT, or distributions of VRT equity interests by the Company or its affiliates to shareholders or their respective parent interest holders (an acquisition pursuant clauses (a) or (b) above, an “Early Purchase”). VRT has the right to acquire Rockpoint’s interest in the agreement,Preferred Units in connection with an Early Purchase for a purchase price generally equal to (i) the amount that Rockpoint would receive upon the sale of the assets of VRLP for fair market value and a distribution of the net sale proceeds in accordance with (A) the capital event distribution priorities discussed above (in the case of certain Rockpoint Preferred Holders) and (B) the distribution priorities applicable in the case of a liquidation of VRLP (in the case of the other Rockpoint Preferred Holder), plus (ii) a make whole premium (such purchase price, the “Purchase Payment”). The make whole premium is an amount equal to (i) $173.5 million until December 28, 2020, or $198.5 million thereafter, less distributions theretofore made to Rockpoint withRRTVRT may acquire from Rockpoint, or Rockpoint may cause RRTsell to redeem (a “Put/Call Event”)VRT, all, but not less than all, of Rockpoint’s interest in the RockpointPreferred Units based on(each, a net asset value“Put/Call Event”) for a purchase price equal to the Purchase Payments (determined without regard to the make whole premium and any related tax allocations). An acquisition of RRLPRockpoint’s interest in the Preferred Units pursuant to a Put/Call Event is generally required to be determinedstructured as a purchase of the common equity in the applicable Rockpoint entities holding direct or indirect interests in the Preferred Units (the “Put/Call Interests”). Subject to certain exceptions, Rockpoint also has a right of first offer and a participation right with respect to other common equity interests of VRLP or any subsidiary of VRLP that may be offered for sale by a third party valuation and generally based on the capital event waterfall described above. OnVRLP or its subsidiaries from time to time. Upon a Put/Call Event, other than in the event of a sale of RRLP,VRLP, Rockpoint can either demand payment in cash or may elect to convert all, but not less than all, of its investmentPreferred Units to common equityCommon Units in RRLP. VRLP.RockpointPreferred Units contain a substantive redemption feature that is outside of the Company’s control and accordingly, pursuant to ASC 480-1—S99-3A, the RockpointPreferred Units arewere previously classified in mezzanine equity measured based on the estimated future redemption value before the redemption right was exercised.SeptemberJune 30, 2017.3.53.50 percent, or (y) the then-effective annual dividend yield on the General Partner’s common stock, and is convertible into 27.936 common units of limited partnership interests of the Operating Partnership beginning generally five years from the date of issuance, or an aggregate of up to 257,375 Common Units. The conversion rate was based on a value of $35.80 per common unit. The Series A-1 Units have a liquidation and dividend preference senior to the Common Units and include customary anti-dilution protections for stock splits and similar events. The Series A-1 Units are redeemable for cash at their stated value beginning five years from the date of issuance at the option of the holder. The Series A-1 Units are pari passu with the 42,800 3.5% Series A Units issued on February 3, 2017.table setstables set forth the changes in Mandatorily redeemable noncontrolling interests for the three and six months ended June 30, 2023 (dollars in thousands):Rockpoint
Interests
in VRTBalance at January 1 and April 1, 2023 $ — Reclassification 479,977 Income Attributed to Noncontrolling Interests 5,748 Distributions (5,748) Redemption Value Adjustment 7,642 Balance at Balance at June 30, 2023 $ 487,619 ninethree and six months ended SeptemberJune 30, 2017 (dollars2023 and 2022, respectively (dollars in thousands):Series A and
A-1 Preferred
Units
In VRLPTotal
Redeemable
Noncontrolling
InterestsBalance at April 1, 2023 $ 40,231 $ 479,977 $ 520,208 Income Attributed to Noncontrolling Interests 350 267 617 Distributions (350) (267) (617) Reclassification to Mandatorily Redeemable Non-controlling Interests — (479,977) (479,977) Balance at June 30, 2023 $ 40,231 $ — $ 40,231 Series A and
A-1 Preferred
Units
In VRLPRockpoint
Interests
in VRTTotal
Redeemable
Noncontrolling
InterestsBalance at April 1, 2022 $ 40,302 $ 472,210 $ 512,512 Income Attributed to Noncontrolling Interests 350 6,016 6,366 Distributions (350) (6,016) (6,366) Redemption Value Adjustment (71) 3,884 3,813 Balance at June 30, 2022 $ 40,231 $ 476,094 $ 516,325 Series A and
A-1 Preferred
Units
In VRLPTotal
Redeemable
Noncontrolling
InterestsBalance at Balance at January 1, 2023 $ 40,231 $ 475,000 $ 515,231 Income Attributed to Noncontrolling Interests 700 6,283 6,983 Distributions (700) (6,283) (6,983) Redemption Value Adjustment — 4,977 4,977 Reclassification to Mandatorily Redeemable Non-controlling Interests — (479,977) (479,977) Balance at June 30, 2023 $ 40,231 $ — $ 40,231 Series A and
A-1 Preferred
Units
In VRLP Rockpoint
Interests
in VRT Total
Redeemable
Noncontrolling
InterestsBalance at January 1, 2022 $ 52,324 $ 468,989 $ 521,313 Redemption/Payout (12,000) — (12,000) Net 40,324 468,989 509,313 Income Attributed to Noncontrolling Interests 771 12,032 12,803 Distributions (771) (12,032) (12,803) Redemption Value Adjustment (93) 7,105 7,012 Balance at June 30, 2022 $ 40,231 $ 476,094 $ 516,325 MACK-CALI REALTY CORPORATIONVERIS RESIDENTIAL, INC. STOCKHOLDERS’ EQUITY AND MACK-CALI REALTY,VERIS RESIDENTIAL, L.P.’S PARTNERS’ CAPITALThree Months Ended
June 30,Six Months Ended
June 30,2023 2022 2023 2022 Opening Balance $ 1,216,530 $ 1,275,681 $ 1,235,685 $ 1,281,982 Net (loss) income available to common shareholders (27,434) 26,373 (47,407) 17,281 Redeemable noncontrolling interests — (3,524) (4,516) (6,466) Redemption of common units for common stock 4,192 161 9,051 161 Shares issued under Dividend Reinvestment and Stock Purchase Plan 1 16 2 27 Directors' deferred compensation plan 86 110 196 220 Stock Compensation 3,381 2,509 6,852 4,466 Cancellation of common stock (219) (696) (466) (696) Other comprehensive income (loss) 1,399 (54) 541 1,932 Rebalancing of ownership percent between parent and subsidiaries (983) (4,296) (2,985) (2,627) Balance at June 30 $ 1,196,953 $ 1,296,280 $ 1,196,953 $ 1,296,280 SHARE/UNIT REPURCHASEIn September 2012,Board of Directors of the General Partner renewedCompany entered into a distribution agreement (the “Distribution Agreement”) with J.P. Morgan Securities LLC, BofA Securities, Inc., BNY Mellon Capital Markets, LLC, Capital One Securities, Inc., Comerica Securities, Inc., Goldman Sachs & Co. LLC, R. Seelaus & Co., LLC and authorized an increaseSamuel A. Ramirez & Company, Inc., as sales agents. Pursuant to the General Partner’s repurchase program (“Repurchase Program”). The General Partner has authorization to repurchase up to $150 million of its outstanding common stock underDistribution Agreement, the renewed Repurchase Program, which itCompany may repurchaseissue and sell, from time to time, in open market transactions at prevailing prices orshares of common stock, par value $0.01 per share, having a combined aggregate offering price of up to $200 million. The Company will pay a commission that will not exceed, but may be lower than, 2% of the gross proceeds of all shares sold through privately negotiated transactions.the ATM Program. As of SeptemberJune 30, 2017,2023, the General Partner has repurchased and retired 394,625Company had not sold any shares of its outstanding common stock for an aggregate cost of approximately $11 million (all of which occurred in the year ended December 31, 2012), with a remaining authorization under the Repurchase Program of $139 million. Concurrent with these repurchases, the General Partner soldpursuant to the Operating Partnership common units for approximately $11 million.5.55.4 million shares of the General Partner’s common stock have been reserved for future issuance. The DRIP provides for automatic reinvestment of all or a portion of a participant’s dividends from the General Partner’s shares of common stock. The DRIP also permits participants to make optional cash investments up to $5,000 a month without restriction and, if the Company waives this limit, for additional amounts subject to certain restrictions and other conditions set forth in the DRIP prospectus filed as part of the Company’s effective registration statement on Form S-3 filed with the SEC for the approximately 5.55.4 million shares of the General Partner’s common stock reserved for issuance under the DRIP.OPTION PLANShavehas been reserved for issuance.On In June 5, 2015, in connection with employment agreements entered into with each2021, stockholders of Messrs. Rudin and DeMarco (together, the “Executive Employment Agreements”), the Company grantedapproved amendments to the 2013 Plan to increase the total shares reserved for issuance under the plan from 4,600,000 to 6,565,000 shares.to purchase a total of 800,000 shares ofissued in June 2021 under the 2013 Plan, in March 2021, the General Partner’s commonPartner granted 950,000 stock exercisable for a period of ten yearsoptions with an exercise price equal to the closing price of the General Partner’sCompany’s common stock on the grant date of $17.31$15.79 per share to the Chief Executive Officer as an employment “inducement award” that is intended to comply with 400,000New York Stock Exchange Rule 303A.08. In April 2022, the General Partner granted 250,000 stock options with an exercise price equal to the closing price of such options vesting in three equal annual installments commencingthe Company’s common stock on the first anniversary of the grant date (“Time Vesting Options”), and 400,000 of such options vesting if the General Partner’s common stock trades at or above $25.00$16.33 per share for 30 consecutive trading days whileto the executiveChief Investment Officer as an employment “inducement award” that is employed (“Price Vesting Options”), or on or before June 30, 2019, subjectintended to certain conditions. The Price Vesting Options vested on July 5, 2016 on account of the price vesting condition being achieved.Information regarding the Company’s stock option plans is summarized below:ninesix months ended SeptemberJune 30, 20172023 and 2016,2022, respectively. The Company has a policy of issuing new shares to satisfy stock option exercises.SeptemberJune 30, 20172023 and December 31, 2016,2022, the stock options outstanding had a weighted average remaining contractual life of approximately 7.74.1 and 8.44.6 years, respectively.$116,000$322 thousand and $924,000$309 thousand for the three months ended SeptemberJune 30, 20172023 and 2016,2022, respectively and $348,000$644 thousand and $1,291,000$562 thousand for the ninesix months ended SeptemberJune 30, 20172023 and 2016,2022, respectively.RESTRICTED STOCK AWARDSawardsunits and common stock (“Restricted Stock Awards”) to officers, certain other employees and non-employee members of the Board of Directors, of the General Partner, which allow the holders to each receive a certain amount of shares of the General Partner’s common stock generally over a one-year to three-year vesting period. On June 14, 2023, the Company issued Restricted Stock Awards to non-employee members of the Board of Directors which vest within one to seven-year vesting period,year, of which 95,80154,184 unvested sharesRestricted Stock Awards were legally outstanding at SeptemberJune 30, 2017.2023. During the years ended December 31, 2021 and December 31, 2022 and the six months ended June 30, 2023, the Company granted restricted stock units to certain non-executive employees of the Company which will vest after three years, of which 358,164 were still outstanding and unvested as of June 30, 2023. Restricted Stock Awards allow holders to receive shares of the Company’s common stock upon vesting. Vesting of the Restricted Stock Awards issued to executive officers and certain other employees is based on time and service.On June 5, 2015, in connection with the Executive Employment Agreements, the Company granted a total of 37,550.54 Restricted Stock Awards, which were valued in accordance with ASC 718 — Stock Compensation, at their fair value. These awards vest equally over a three-year period on each annual anniversary date of the grant date.of the General Partner were issued under the 2013 Plan.Information regarding the Restricted Stock Awards grant activity is summarized below:SeptemberJune 30, 2017,2023, the Company had $1.5$4.4 million of total unrecognized compensation cost related to unvested Restricted Stock Awards granted under the Company’s stock compensation plans. That cost is expected to be recognized over a weighted average period of 1.21.6 years.PERFORMANCE SHARE UNITSOn June 5, 2015, in connection with the Executive Employment Agreements, the Company granted a total of 112,651.64 performance share units (“PSUs”) which will vest from 0 to 150 percent of the number of PSUs granted based on the Company’s total shareholder return relative to a peer group of equity office REITs over a three-year performance period starting from the grant date, each PSU evidencing the right to receive a share of the General Partner’s common stock upon vesting. The PSUs are also entitled to the payment of dividend equivalents in respect of vested PSUs in the form of additional PSUs. The PSUs were valued in accordance with ASC 718, Compensation - Stock Compensation, at their fair value on the grant date, utilizing a Monte-Carlo simulation to estimate the probability of the vesting conditions being satisfied.reserved shares of common stock under the 2013 Plan for issuance upon vesting of the PSUs in accordance with their terms and conditions.As of September 30, 2017, the Company had $0.3 million of total unrecognized compensation cost related to unvested PSUs granted under the Company’s stock compensation plans. That cost is expected to be recognized over a weighted average period of 0.7 years.LONG-TERM INCENTIVE PLAN AWARDSOn March 8, 2016, the Company granted Long-Term Incentive Planlong-term incentive plans awards (“LTIP”LTIP Awards”) awards to senior management of the Company, including the General Partner’s executive officers (the “2016 LTIP Awards”). All of the 2016officers. LTIP Awards weregenerally are granted in the form of restricted stock units in(each, an “RSU” and collectively, the Operating Partnership (““RSU LTIP Units”Awards”) and constitute awards under the 2013 Plan. For Messrs. Rudin, DeMarco and Tycher, approximately 25 percent of the target 2016Prior to 2021, LTIP Award wasAwards were in the form of a time-based award that will vest after three years on March 8, 2019 (the “2016 TBV LTIP Units”), andUnits. LTIP Awards are typically issued from the remaining approximately 75 percentCompany’s Outperformance Plan adopted by the Board of Directors. Each RSU entitles the holder to one share of the target 2016General Partner's common stock upon vesting. LTIP Awards are subject to forfeiture depending on the extent that awards vest. The number of market-based and performance-based LTIP Units that actually vest for each award recipient will be determined at the end of the related measurement period.wasgrant program in the form of RSUs. A portion of the RSUs are subject to time-based vesting conditions and will vest in three equal, annual installments over a performance-based award under a new Outperformance Plan (the “2016 OPP”) adopted bythree year period ending on the three year anniversary of the grant date. Currently, there are 427,099 awards outstanding and unvested.Directors consistingDirectors. Currently, there are 580,415 awards outstanding and unvested.a multi-year, performance-based equity compensation plan and related forms of award agreement (the “2016 PBVadjusted funds from operations targets. The RSU LTIP Units”). For all other executive officers, approximately 40 percent of the target 2016 LTIP Award was in the form of 2016 TBV LTIP Units and the remaining approximately 60 percent of the target 2016 LTIP Award was in the form of 2016 PBV LTIP Units.The 2016 OPP isAwards are designed to align the interests of senior management to relative and absolute performance of the Company over a three-yearthree years performance period from March 8, 2016 through March 7, 2019. Participants in the 2016 OPP will only earn the fullperiod. Currently there are 627,644 awards if, over the three-year performance period, the Company achieves a 50 percent absolute total stockholder return (“TSR”)outstanding and if the Company is in the 75th percentile of performance versus the NAREIT Office Index.Onunvested.4, 2017, the Company granted LTIP awards to senior management of the Company, including2022, the General Partner’sPartner granted approximately 60,000 RSUs subject to time-vesting conditions, vesting over three years, to three executive officers (the “2017 LTIP Awards”). All of the 2017 LTIP Awards were in the form of LTIP Units and constitute awards under the 2013 Plan. For Messrs. DeMarco, Tycher and Rudin, approximately twenty-five percent (25%) of the 2017 LTIP Award was in the form of a time-based award that will vest after three years on April 4, 2020 (the “2017 TBV LTIP Units”), and the remaining approximately seventy-five percent (75%) of the 2017 LTIP Award was in the form of a performance-based award under the Company’s Outperformance Plan (the “2017 OPP”) adopted by the General Partner’s Board of Directors, consisting of a multi-year, performance-based equity compensation plan and related forms of award agreement (the “2017 PBV LTIP Units”). For all other executive officers, approximately forty percent (40%) of the 2017 LTIP Award was in the form of 2017 TBV LTIP Units and the remaining approximately sixty percent (60%) of the 2017 LTIP Award was in the form of 2017 PBV LTIP Units.The 2017 OPP is designedas “inducement awards” intended to align the interests of senior management to relative and absolute performance of the Company over a three-year performance period from April 4, 2017 through April 3, 2020. Participants in the 2017 OPP will only earn the full awards if, over the three-year performance period, the Company achieves a thirty-six percent (36%) absolute TSR and if the Company is in the 75th percentile of performance as compared to the NAREIT office index.LTIP Units will remain subject to forfeiture depending on the extent that the 2016 LTIP Awards and 2017 LTIP Awards vest. The number of LTIP Units to be issued initially to recipients of the 2016 PBV LTIP Awards and 2017 PBV LTIP Awards is the maximum number of LTIP Units that may be earned under the awards. The number of LTIP Units that actually vest for each award recipient will be determined at the end of the performance measurement period. TSR for the Company and for the Index over the three-year measurement period and other circumstances will determine how many LTIP Units vest for each recipient; if they are fewer than the number issued initially, the balance will be forfeited as of the performance measurement date.(10 percent) of the regular quarterly distributions payable on a common unit of limited partnership interest in the Operating Partnership (a “common unit”),share but will not be entitled to receive any special distributions. Distributions with respect to the other nine-tenths (90 percent) of regular quarterly distributions payable on a common unit will accrue but shall only become payable upon vesting of the LTIP Unit. After vesting of the 2016 TBV LTIP Units and 2017 TBV LTIP Units or the end of the measurement period for the 2016 PBV LTIP Unitsand 2017 PBV LTIP Units, the number of LTIP Units, both vested and unvested, will be entitled to receive distributions in an amount per unit equal to distributions, both regular and special, payable on a common unit.SeptemberJune 30, 2017, the Company granted a total of 496,781 2016 PBV LTIP Units, 155,773 2016 TBV LTIP Units, 481,436 2017 PBV LTIP Units and 96,887 2017 TBV LTIP Units. The LTIP Units were valued in accordance with ASC 718 — Stock Compensation, at their fair value. The Company has reserved shares of common stock under the 2013 Plan for issuance upon vesting and conversion of the LTIP Units in accordance with their terms and conditions.As of September 30, 2017,2023, the Company had $12.4$12.3 million of total unrecognized compensation cost related to unvested LTIP awards granted under the Company’s stock compensation plans. That cost is expected to be recognized over a weighted average period of 2.71.9 years.DEFERRED STOCK COMPENSATION PLAN FOR DIRECTORSninethree months ended SeptemberJune 30, 20172023 and 2016, 14,0022022, 5,379 and 11,2498,234 deferred stock units were earned, respectively. During the six months ended June 30, 2023 and 2022, 12,950 and 14,417 deferred stock units were earned, respectively. AsSeptemberJune 30, 20172023 and December 31, 2016,2022, there were 205,55759,874 and 193,71166,196 deferred stock units outstanding, respectively.ninesix months ended SeptemberJune 30, 20172023 and 20162022 in accordance with ASC 260, Earnings Per Share: Share (dollars in thousands, except per share amounts)Mack-Cali Realty Corporation:Three Months Ended
June 30,Six Months Ended
June 30,Computation of Basic EPS 2023 2022 2023 2022 (Loss) income from continuing operations $ (26,787) $ 33,282 $ (46,000) $ 6,779 Add (deduct): Noncontrolling interests in consolidated joint ventures 636 784 1,223 1,758 Add (deduct): Noncontrolling interests in Operating Partnership 2,384 (2,568) 4,696 305 Add (deduct): Redeemable noncontrolling interests (617) (6,366) (6,983) (12,803) Add (deduct): Redemption value adjustment of redeemable noncontrolling interests attributable to common shareholders — (3,524) (4,516) (6,466) (Loss) income from continuing operations available to common shareholders $ (24,384) $ 21,608 $ (51,580) $ (10,427) (Loss) income from discontinued operations available to common shareholders (3,050) 1,241 (343) 21,242 Net (loss) income available to common shareholders for basic earnings per share (27,434) 22,849 (51,923) 10,815 Weighted average common shares 91,873 91,027 91,551 90,989 (Loss) income from continuing operations available to common shareholders $ (0.27) $ 0.24 $ (0.56) $ (0.11) (Loss) income from discontinued operations available to common shareholders (0.03) 0.01 0.00 0.23 Net (loss) income available to common shareholders $ (0.30) $ 0.25 $ (0.56) $ 0.12 Three Months Ended
June 30,Six Months Ended
June 30,Computation of Diluted EPS 2023 2022 2023 2022 Net (loss) income from continuing operations available to common shareholders $ (24,384) $ 21,608 $ (51,580) $ (10,427) Add (deduct): Noncontrolling interests in Operating Partnership (2,384) 2,568 (4,696) (305) Add (deduct): Redemption value adjustment of redeemable noncontrolling interests attributable to the Operating Partnership unitholders — (360) (461) (651) (Loss) income from continuing operations for diluted earnings per share (26,768) 23,816 (56,737) (11,383) (Loss) income from discontinued operations for diluted earnings per share (3,348) 1,368 (365) 23,344 Net (loss) income available for diluted earnings per share $ (30,116) $ 25,184 $ (57,102) $ 11,961 Weighted average common shares 100,854 100,352 100,691 100,171 (Loss) income from continuing operations available to common shareholders $ (0.27) $ 0.24 $ (0.56) $ (0.11) (Loss) Income from discontinued operations available to common shareholders (0.03) 0.01 0.00 0.23 Net (loss) income available to common shareholders $ (0.30) $ 0.25 $ (0.56) $ 0.12 calculation: calculation (in thousands)Contingently issuable shares under the PSU Awards were excluded from the denominator in 2017 and 2016 because the criteria had not been met for the periods.
Contingently issuable shares under Restricted Stock Awards Three Months Ended
June 30,Six Months Ended
June 30,2023 2022 2023 2022 Basic EPS shares 91,873 91,027 91,551 90,989 Add: Operating Partnership – common and vested LTIP units 8,981 9,302 9,140 9,144 Restricted Stock Awards — 7 — 10 Stock Options — 16 — 28 Diluted EPS Shares 100,854 100,352 100,691 100,171 andwere excluded from the denominator during the periods ended June 30, 2023 as such securities were anti-dilutive during the periods. Shares issuable under all outstanding stock options were excluded from the denominator induring the three month periodperiods ended SeptemberJune 30, 20162023 as such securities were anti-dilutive during the period. Contingently issuable shares under Price Vesting Options were excluded from the denominator in 2016 because the criteria had not been met for the period ended September 30, 2016.periods. Also not included in the computations of diluted EPS were all of the unvested LTIP Units and unvested AO LTIP Units as such securities were anti-dilutive during all periods presented. Unvested LTIP Awards outstanding as of June 30, 2023 and 2022 were 2,096,075 and 1,866,543, respectively. Unvested restricted common stock outstanding as of SeptemberJune 30, 20172023 and 20162022 were 95,80154,184 and 82,71649,784 shares, respectively.Dividends Unvested AO LTIP Units outstanding as of June 30, 2022 were 625,000.three-monthsix-month periods ended SeptemberJune 30, 20172023 and 2016 was $0.20 and $0.15 per share, respectively. Dividends declared per common share for the nine-month periods ended September 30, 2017 and 2016 was $0.55 and $0.45 per share, respectively.Mack-Cali Realty,2022.Three Months Ended
June 30,Six Months Ended
June 30,Computation of Basic EPU 2023 2022 2023 2022 Loss from continuing operations $ (26,787) $ 33,282 $ (46,000) $ 6,779 Add (deduct): Noncontrolling interests in consolidated joint ventures 636 784 1,223 1,758 Add (deduct): Redeemable noncontrolling interests (617) (6,366) (6,983) (12,803) Add (deduct): Redemption value adjustment of redeemable noncontrolling interests — (3,884) (4,977) (7,117) (Loss) income from continuing operations available to unitholders (26,768) 23,816 (56,737) (11,383) (Loss) income from discontinued operations available to unitholders (3,348) 1,368 (365) 23,344 Net (loss) income available to common unitholders for basic earnings per unit $ (30,116) $ 25,184 $ (57,102) $ 11,961 Weighted average common units 100,854 100,329 100,691 100,133 (Loss) income from continuing operations available to unitholders $ (0.27) $ 0.24 $ (0.56) $ (0.11) (Loss) income from discontinued operations available to unitholders (0.03) 0.01 0.00 0.23 Net (loss) income available to common unitholders for basic earnings per unit $ (0.30) $ 0.25 $ (0.56) $ 0.12 Three Months Ended
June 30,Six Months Ended
June 30,Computation of Diluted EPU 2023 2022 2023 2022 (Loss) income from continuing operations available to common unitholders $ (26,768) $ 23,816 $ (56,737) $ (11,383) (Loss) income from discontinued operations for diluted earnings per unit (3,348) 1,368 (365) 23,344 Net (loss) income available to common unitholders for diluted earnings per unit $ (30,116) $ 25,184 $ (57,102) $ 11,961 Weighted average common unit 100,854 100,352 100,691 100,171 (Loss) income from continuing operations available to common unitholders $ (0.27) $ 0.24 $ (0.56) $ (0.11) (Loss) income from discontinued operations available to common unitholders (0.03) 0.01 0.00 0.23 Net (loss) income available to common unitholders $ (0.30) $ 0.25 $ (0.56) $ 0.12 calculation: calculation (in thousands)Contingently issuable shares under the PSU Awards were excluded from the denominator in 2017 and 2016 because the criteria had not been met for the periods. Three Months Ended
June 30,Six Months Ended
June 30,2023 2022 2023 2022 Basic EPU units 100,854 100,329 100,691 100,133 Add: Restricted Stock Awards — 7 — 10 Stock Options — 16 — 28 Diluted EPU Units 100,854 100,352 100,691 100,171 andwere excluded from the denominator during the periods ended June 30, 2023 as such securities were anti-dilutive during the periods. Shares issuable under all outstanding stock options were excluded from the denominator induring the three month periodperiods ended SeptemberJune 30, 20162023 as such securities were anti-dilutive during the period. Contingently issuable shares under Price Vesting Options were excluded from the denominator in 2016 because the criteria had not been met for the period ended September 30, 2016.periods. Also not included in the computations of diluted EPU were all of the unvested LTIP Units and unvested AO LTIP Units as such securities were anti-dilutive during all periods presented. Unvested LTIP Awards outstanding as of June 30, 2023 and 2022 were 2,096,075 and 1,866,543, respectively. Unvested restricted common stock outstanding as of SeptemberJune 30, 20172023 and 20162022 were 95,80154,184 and 82,71649,784 shares, respectively.Distributions Unvested AO LTIP Units outstanding as of March 31, 2022 were 625,000.three-monthsix-month periods ended SeptemberJune 30, 20172023 and 2016 was $0.20 and $0.15 per unit, respectively. Distributions declared per common unit for the nine-month periods ended September 30, 2017 and 2016 was $0.55 and $0.45 per unit, respectively.ninethree and six months ended SeptemberJune 30, 20172023 and 2016,2022, respectively (dollars in thousands): Three Months Ended
June 30,Six Months Ended
June 30, 2023 2022 2023 2022 Opening Balance at January 1 $ 157,439 $ 165,120 $ 163,652 $ 167,436 Net (loss) income (2,701) 8,277 1,042 12,842 Unit distributions — — — 218 Redeemable noncontrolling interests (617) (6,726) (7,444) (13,454) Change in noncontrolling interests in consolidated joint ventures — 7 (562) 18 Redemption of common units for common stock (4,192) (161) (9,051) (161) Redemption of common units (78) (359) (94) (1,801) Stock compensation 94 445 487 2,978 Other comprehensive income (loss) 137 (6) 50 190 Rebalancing of ownership percentage between parent and subsidiaries 983 4,296 2,985 2,627 Balance at June 30 $ 151,065 $ 170,893 $ 151,065 $ 170,893 interestinterests unitholders in the subsidiary) while the parent retains its controlling interest in its subsidiary should be accounted for as equity transactions. The carrying value of the noncontrolling interestinterests shall be adjusted to reflect the change in itsMack-Cali Realty CorporationVeris Residential, Inc. stockholders’ equity and noncontrolling interests in the Operating Partnership that occurred during the ninesix months ended SeptemberJune 30, 2017,2023, the Company has decreasedincreased noncontrolling interests in the Operating Partnership and increaseddecreased additional paid-in capital in Mack-Cali Realty CorporationVeris Residential, Inc. stockholders’ equity by approximately $3.8$3.0 million as of SeptemberJune 30, 2017.INTERESTINTERESTS IN OPERATING PARTNERSHIP (applicable only to General Partner)interestinterests in the Operating Partnership is reduced and Mack-Cali Realty CorporationVeris Residential, Inc. Stockholders’ equity is increased.On March 8, 2016,2016 LTIP Awardsawards to senior managementexecutive officers of the Company, including the General Partner’s executive officers. On April 4, 2017, the Company granted 2017 LTIP Awards to senior management of the Company, including the General Partner’s executive officers.Company. All of the 2016 LTIP Awards and 2017 LTIP Awards will begranted through January 2021 are in the form of units in the Operating Partnership. See Note 15: Mack-Cali Realty CorporationVeris Residential, Inc. Stockholders’ Equity and Mack-Cali Realty,Veris Residential, L.P.’s Partners’ Capital —– Long-Term Incentive Plan Awards.Unit TransactionsThe following table sets forthchanges in noncontrolling interests in subsidiaries which relateCompany granted 625,000 AO LTIP Units pursuant to the common unitsAO Long Term Incentive Plan Award Agreement. See Note 15: Veris Residential, Inc. Stockholders’ Equity and Veris Residential, L.P.’s Partners’ Capital – Incentive Stock Plan (Appreciation-Only LTIP Units).the nine months ended September 30, 2017:InterestInterests Ownership in Operating PartnershipSeptemberJune 30, 20172023 and December 31, 2016,2022, the noncontrolling interestinterests common unitholdersunit holders owned 10.48.8 percent and 10.59.3 percent of the Operating Partnership, respectively.INTERESTINTERESTS IN CONSOLIDATED JOINT VENTURES (applicable to General Partner and Operating Partnership)In June 2017, the Company acquired the remaining noncontrolling interest in 150 Main Street, LLC, a consolidated joint venture, for cash consideration of $2 million and the issuance of 99,412 Common Units valued at $2.8 million.certain real estate projects (three properties and a potential future development) each providedevelopment provides for the initial distributions of net cash flow solely to the Company, and thereafter, other parties have participation rights in 50 percent of the excess net cash flow remaining after the distribution to the Company of the aggregate amount equal to the sum of: (a) the Company’s capital contributions, plus (b) an IRR of 10 percent per annum.threetwo business segments: (i) multifamily real estate and services and (ii) commercial and other real estate, (ii) multi-family real estate, and (iii) multi-family services.estate. The Company provides leasing, property management, leasing, acquisition, development, construction and tenant-related services for its commercial and other real estate and multi-familymultifamily real estate portfolio. The Company’s multi-familymultifamily services business also provides similar services for third parties. The Company no longer considers construction services as a reportable segment as it phased out this line of business in 2014. The Company had no revenues from foreign countries recorded for the ninesix months ended SeptemberJune 30, 20172023 and 2016.2022. The Company had no long lived assets in foreign locations as of SeptemberJune 30, 20172023 and December 31, 2016.2022. The accounting policies of the segments are the same as those described in Note 2: Significant Accounting Policies, excluding depreciation and amortization.multi-family)multifamily real estate and from its multi-family services segment.ninethree and six months ended SeptemberJune 30, 20172023 and 20162022 and selected asset information as of SeptemberJune 30, 20172023 and December 31, 20162022 regarding the Company’s operating segments are as follows. Amounts for prior periods have been restated to conform to the current period segment reporting presentation: presentation (dollars in thousands)Commercial
& Other Real EstateMultifamily
Real Estate & Services (d)Corporate
& Other (e)Total
CompanyTotal revenues: Three months ended: June 30, 2023 $ 4,525 $ 64,144 $ 60 $ 68,729 June 30, 2022 1,379 52,876 (442) 53,813 Six months ended: June 30, 2023 $ 8,290 $ 126,422 $ 976 $ 135,688 June 30, 2022 4,865 99,393 (944) 103,314 Total operating and interest expenses (a): Three months ended: June 30, 2023 $ 3,050 $ 23,710 $ 45,968 $ 72,728 June 30, 2022 672 26,221 26,357 53,250 Six months ended: June 30, 2023 $ 4,697 $ 52,061 $ 77,008 $ 133,766 June 30, 2022 1,372 51,008 57,637 110,017 Equity in earnings (loss) of unconsolidated joint ventures: Three months ended: June 30, 2023 $ — $ 2,700 $ — $ 2,700 June 30, 2022 — 2,638 — 2,638 Six months ended: June 30, 2023 $ — $ 2,633 $ — $ 2,633 June 30, 2022 — 2,151 — 2,151 Net operating income (loss) (b): Three months ended: June 30, 2023 $ 1,475 $ 43,134 $ (45,908) $ (1,299) June 30, 2022 707 29,293 (26,799) 3,201 Six months ended: June 30, 2023 $ 3,593 $ 76,994 $ (76,032) $ 4,555 June 30, 2022 3,493 50,536 (58,581) (4,552) Total assets: June 30, 2023 $ 200,488 $ 3,192,520 $ 379,825 $ 3,772,833 December 31, 2022 597,459 3,302,188 21,121 3,920,768 Total long-lived assets (c): June 30, 2023 $ 194,879 $ 2,969,009 $ (1,503) $ 3,162,385 December 31, 2022 547,923 3,101,286 (1,330) 3,647,879 Total investments in unconsolidated joint ventures: June 30, 2023 $ — 122,435 $ — $ 122,435 December 31, 2022 — 126,158 — 126,158 direct construction costs; real estate services expenses; general and administrative, acquisition related costs and interest expense (net of interest income). All interest expense, net of interest and other investment income (including for property-level mortgages), is excluded from segment amounts and classified in Corporate & Other for all periods.receivablereceivable.goodwill.(d)operations were owned through a consolidated and variable interest entity commencing in February 2018.expense, construction services revenue and direct construction costs)expense), as well as intercompany eliminations necessary to reconcile to consolidated Company totals.(e) Includes $4.1 million and $12.0 million of fees and salary reimbursements earned for the three and nine months ended September 30, 2017, from the multi-family real estate segment, which are eliminated in consolidation.(f) Includes $3.8 million and $10.1 million of fees and salary reimbursements earned for the three and nine months ended September 30, 2016, from the multi-family real estate segment, which are eliminated in consolidation.(g) Includes $2.3 million and $6.2 million of management fees and salary reimbursement expenses for the three and nine months ended September 30, 2017, from the multi-family real estate segment, which are eliminated in consolidation.(h) Includes $1.8 million and $4.9 million of management fees and salary reimbursement expenses for the three and nine months ended September 30, 2016, from the multi-family real estate segment, which are eliminated in consolidation.Mack-Cali Realty Corporationshareholders: shareholders (dollars in thousands)Mack-Cali Realty,Three Months Ended
June 30,Six Months Ended
June 30,2023 2022 2023 2022 Net operating (loss) income $ (1,299) $ 3,201 $ 4,555 $ (4,552) Add (deduct): Depreciation and amortization (23,684) (21,015) (47,331) (39,456) Land and other impairments, net — (3,900) (3,396) (6,832) (Loss) Gain on disposition of developable land — 55,125 (22) 57,748 Gain (loss) from extinguishment of debt, net (2,657) (129) (2,657) (129) Other income, net 853 — 2,851 — (Loss) income from continuing operations (26,787) 33,282 (46,000) 6,779 Discontinued operations (Loss) income from discontinued operations 140 5,808 2,344 25,948 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net (3,488) (4,440) (2,709) (2,604) Total discontinued operations, net (3,348) 1,368 (365) 23,344 Net (loss) income (30,135) 34,650 (46,365) 30,123 Noncontrolling interests in consolidated joint ventures 636 784 1,223 1,758 Noncontrolling interests in Operating Partnership 2,384 (2,568) 4,696 305 Noncontrolling interest in discontinued operations 298 (127) 22 (2,102) Redeemable noncontrolling interests (617) (6,366) (6,983) (12,803) Net (loss) income available to common shareholders $ (27,434) $ 26,373 $ (47,407) $ 17,281 unitholders: unitholders (dollars in thousands)Three Months Ended
June 30,Six Months Ended
June 30,2023 2022 2023 2022 Net operating (loss) income $ (1,299) $ 3,201 $ 4,555 $ (4,552) Add (deduct): Depreciation and amortization (23,684) (21,015) (47,331) (39,456) Land and other impairments, net — (3,900) (3,396) (6,832) Gain on disposition of developable land — 55,125 (22) 57,748 Gain (loss) from extinguishment of debt, net (2,657) (129) (2,657) (129) Other income, net 853 — 2,851 — (Loss) income from continuing operations (26,787) 33,282 (46,000) 6,779 Discontinued operations (Loss) income from discontinued operations 140 5,808 2,344 25,948 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net (3,488) (4,440) (2,709) (2,604) Total discontinued operations, net (3,348) 1,368 (365) 23,344 Net (loss) income (30,135) 34,650 (46,365) 30,123 Noncontrolling interests in consolidated joint ventures 636 784 1,223 1,758 Redeemable noncontrolling interests (617) (6,366) (6,983) (12,803) Net (loss) income available to common unitholders $ (30,116) $ 29,068 $ (52,125) $ 19,078 Mack-Cali Realty CorporationVeris Residential, Inc. and Mack-Cali Realty,Veris Residential, L.P. and the notes thereto (collectively, the “Financial Statements”). Certain defined terms used herein have the meaning ascribed to them in the Financial Statements.Mack-Cali Realty Corporationis one of the largest real estate investment trusts (REITs) in the United States. Mack-Cali Realty,including Veris Residential, L.P. (the “Operating Partnership”), has been involved in all aspects of commercial real estate development, management and ownership for over 60 years and the General Partner has been a publicly traded REIT since 1994. management, acquisition, development construction and tenant-related services for its General Partner. The Operating Partnership, through its operating divisions and subsidiaries, including the Mack-CaliVeris property-owning partnerships and limited liability companies, is the entity through which all of the General Partner’s operations are conducted. Unless stated otherwise or the context requires, the “Company” refers to the General Partner and its subsidiaries, including the Operating Partnership and its subsidiaries.SeptemberJune 30, 2017,2023, the Company owns or has interests in 16231 properties (collectively, the “Properties”), consisting and developable land parcels. These Properties are comprised of 73 office and 71 flex properties, totaling approximately 18.4 million square feet, leased to approximately 900 commercial tenants and 18 multi-family24 multifamily rental properties containing 5,826 residential units.7,681 apartment units as well as non-core assets comprised of three office properties, four parking/retail properties and eight properties owned by unconsolidated joint ventures in which the Company has investment interests, including seven multifamily properties and a non-core asset. The Properties are located primarilyin three states in the Northeast, some with adjacent, Company-controlled developable land sites able to accommodate up to approximately five million square feetplus the District of additional commercial spaceColumbia.9,987 apartment units.The Company’s historical strategy has been to focus its operations, acquisition and development of office properties in high-barrier-to-entry markets and sub-markets where it believes it is, or can become, a significant and preferred owner and operator. In September 2015, the Company announced a three-year strategic initiative to transformOperating Partnership entered into a more concentrated ownerREIT Interest and Partnership Interest Purchase Agreement (the “Rockpoint Purchase Agreement”) with certain affiliates of New Jersey Hudson River waterfrontRockpoint Group, L.L.C. (Rockpoint Group, L.L.C. and transit-oriented office propertiesits affiliates, collectively, “Rockpoint") pursuant to which VRT and a regional owner of luxury multi-family residential properties. As part of this plan, over the past year, the Company has sold multiple properties, primarily commercial office, which it believes do not meet its long-term goals.As an owner of real estate, almostOperating Partnership acquired from Rockpoint all of the Company’s earnings and cash flow are derived from rental revenue received pursuant to leased space atPreferred Units that constituted the Properties. Key factors that affectPut/Call Interests for an aggregate purchase price of $520 million (the "Rockpoint Redemption”). The Rockpoint Redemption was completed concurrently with the Company’s business and financial results include the following:· the general economic climate;· the occupancy ratessigning of the Properties;· rental rates on new or renewed leases;· tenant improvement and leasing costs incurred to obtain and retain tenants;· the extent of early lease terminations;· the value of our office properties and the cash flow from the sale of such properties;· operating expenses;· anticipated acquisition and development costs for office and multi-family rental properties and the revenues and earnings from these properties;· cost of capital; and· the extent of acquisitions, development and sales of real estate, including the execution of the Company’s current strategic initiative.Any negative effects of the above key factors could potentially cause a deterioration in the Company’s revenue and/or earnings. Such negative effects could include: (1) failure to renew or execute new leases as current leases expire; (2) failure to renew or execute new leases with rental terms at or above the terms of in-place leases; and (3) tenant defaults.A failure to renew or execute new leases as current leases expire or to execute new leases with rental terms at or above the terms of in-place leases may be affected by several factors such as: (1) the local economic climate, which may be adversely impacted by businesslayoffs or downsizing, industry slowdowns, changing demographics and other factors; and (2) local real estate conditions, such as oversupply of the Company’s product types or competition within the market.Of the Company’s core office markets, most have recently shown signs of improvement while others have stabilized. The percentage leased in the Company’s consolidated portfolio of stabilized core operating commercial properties aggregating 15.9 million, 17.6 million and 23.4 million square feet at September 30, 2017, June 30, 2017 and September 30, 2016, respectively, was 89.6 percent leased at September 30, 2017 as compared to 89.9 percent leased at June 30, 2017 and 87.7 percent leased at September 30, 2016 (after adjusting for properties identified as non-core at the time). Percentage leased includes all leases in effect as of the period end date, some of which have commencement dates in the future and leases that expire at the period end date. Leases that expired at September 30, 2017, June 30, 2017 and September 30, 2016 aggregate 443,771, 256,367 and 29,692 square feet, respectively, or 2.8, 1.2 and 0.1 percentage of the net rentable square footage, respectively. Rental rates (including escalations) on the Company’s commercial space that was renewed (based on first rents payable) during the three months ended September 30, 2017 (on 552,527 square feet of renewals) decreased an average of 1.0 percent compared to rates that were in effect under the prior leases, as compared to a 0.8 percent increase during the three months ended September 30, 2016 (on 318,308 square feet of renewals). Estimated lease costs for the renewed leases during the three months ended September 30, 2017 averaged $1.72 per square foot per year for a weighted average lease term of 10.4 years, and estimated lease costs for the renewed leases during the three months ended September 30, 2016 averaged $2.46 per square foot per year for a weighted average lease term of 3.1 years. The Company has achieved positive leasing results in its core markets recently. It believes that commercial vacancy rates may decrease and commercial rental rates may increase in some of its markets in 2017 and possibly beyond. As of September 30, 2017, commercial leases which comprise approximately 5.6 and 14.1 percent of the Company’s annualized base rent are scheduled to expire during the years ended December 31, 2017 and 2018, respectively. With the positive leasing results the Company has achieved in many of its markets recently, the Company believes that rental rates on new leases will generally be, on average, not lower than rates currently being paid. Although the Company has recently achieved positive leasing activity, primarily in its core markets, if the recent leasing results do not prove to be sustaining during 2017 and beyond, the Company’s rental rates it may achieve on new leases may be lower than the rates currently being paid, resulting in the potential for less revenue from the same space.The Company believes that there is a potential for Moody’s or Standard & Poor’s to lower their current investment grade ratings on the Company’s senior unsecured debt to sub-investment grade. Amongst other things, any such downgrade by both Moody’s and Standard & Poor’s will increase the current interest rate on outstanding borrowings under the Company’s current $600 million unsecured revolving credit facility (which was amended in January 2017) from LIBOR plus 120 basis points to LIBOR plus 155 basis points and the annual credit facility fee it pays will increase from 25 to 30 basis points. Additionally, any such downgrade would increase the current interest rate on each of the Company’s $350 million unsecured term loan and $325 million unsecured term loan from LIBOR plus 140 basis points to LIBOR plus 185 points. In the event of a downgrade, the Company could elect to utilize the leverage grid pricing available under the unsecured revolving credit facility and both unsecured term loans. This would result in an interest rate of LIBOR plus 130 basis points for the Company’s unsecured revolving credit facility and 25 basis points for the facility fee and LIBOR plus 155 basis points for both unsecured term loans at the Company’s current total leverage ratio.agreement. In addition, a downgrade in its ratings to sub-investment grade would result in higher interest rates on senior unsecured debt that the Company may issue in the future as compared to issuing such debt with investment grade ratings.The remaining portion of this Management’s Discussion and Analysis of Financial Condition and Results of Operations should help the reader understand our:· recent transactions;· critical accounting policies and estimates;· results from operations for the three and nine months ended September 30, 2017, as compared to the three and nine months ended September 30, 2016, and· liquidity and capital resources.Recent TransactionsAcquisitionsThe Company acquired the following office properties (which were determined to be asset acquisitions in accordance with ASU 2017-01) during the nine months ended September 30, 2017 (dollars in thousands):(a) This acquisition was funded through borrowings under the Company’s unsecured revolving credit facility.(b) This acquisition was funded through borrowings under the Company’s unsecured revolving credit facility and a new $124.5 million loan secured by three of the properties.ConsolidationOn February 3, 2017, the Operating Partnership issued 42,800 shares of a new class of 3.5 percent Series A Preferred Limited Partnership Units of the Operating Partnership (the “Series A Units”), valued at $42.8 million. The Series A Units were issued to the Company’s partners in the Plaza VIII & IX Associates L.L.C. joint venture that owns a development site adjacent to the Company’s Harborside property in Jersey City, New Jersey as non-cash consideration for their approximate 37.5 percent interest in the joint venture. Concurrent with the issuance of the Series A Units, the Company purchased from other partners in the Plaza VIII & IX Associates L.L.C. joint venture their approximate 12.5 percent interest for approximately $14.3 million in cash. The results of these transactions increased the Company’s interests in the joint venture from 50 percent to 100 percent. Upon these acquisitions, the Company consolidated Plaza VIII & IX Associates L.L.C., a voting interest entity, substantially all of which is comprised of land for development. As an acquisition of the additional 50 percent of the land the Company accounted for the transaction under a cost accumulation model, resulting in total consolidated assets of $60.6 million, substantially all of which is classified as land on the Balance Sheet.On February 28, 2017, the Operating Partnership authorized the issuance of 9,213 shares of a new class of 3.5 percent Series A-1 Preferred Limited Partnership Units of the Operating Partnership (the “Series A-1 Units”). 9,122 Series A-1 Units were issued on February 28, 2017, valued at $9.1 million, to the Company’s partner in a joint venture with the Operating Partnership, which owns Monaco Towers in Jersey City, New Jersey that includes 523 apartment homes in two fifty-story towers with 558 parking spaces and 12,300 square feet of ground floor retail space. The Series A-1 Units were issued as non-cash consideration for the partner’s approximate 13.8 percent ownership interest in the joint venture. In April 2017, an additional 91 Series A-1 Units were issued by the Operating Partnership to purchase from other partners in the same joint venture their approximate 71.2 percent ownership interest for approximately $130.9 million in cash and $171.2 million in assumed debt in transactions which closed in April 2017. The results of these transactions increased the Company’s interests in the joint venture to 100 percent. Upon these acquisitions, the Company consolidated RoseGarden Monaco Holdings, L.L.C., a voting interest entity. As an acquisition of the remaining interests in the venture which owns the Monaco Towers, the Company accounted for the transaction under a cost accumulation model, resulting in total consolidated net assets of $139.9 million.Dispositions/Rental Property Held for SaleThe Company disposed of the following office and multi-family properties during the nine months ended September 30, 2017 (dollars in thousands):(a) The Company recorded a valuation allowance of $7.7 million on this property during the year ended December 31, 2016.(b) $15.1 million of the sales proceeds from this sale were held by a qualified intermediary, which is noncash and recorded in deferred charges, goodwill and other assets as of September 30, 2017. See Note 5: Deferred Charges, Goodwill and Other Assets, Net.(c) At closing, the Company provided short term seller financing through mortgage notes receivable to the two separate buyers of $24.8 million and $40.2 million, respectively, with interest rates ranging from 4.0 to 7.0 percent, which mature in November 2017, some with three 30-day extension options. These amounts are noncash components of the net sales proceeds. See Note 5: Deferred Charges, Goodwill and Other Assets, Net.(d) This disposition is of a ground leased land property.(e) The Company recorded an impairment charge of $7.0 million on this property during the year ended December 31, 2015.(f) The Company recorded an impairment charge of $4.2 million on this property during the year ended December 31, 2015. $5.9 million of the sales proceeds from this sale were held by a qualified intermediary, which is noncash and recorded in deferred charges, goodwill and other assets as of September 30, 2017. See Note 5: Deferred Charges, Goodwill and Other Assets, Net.(g) $15.3 million of the sales proceeds from this sale were held by a qualified intermediary, which is noncash and recorded in deferred charges, goodwill and other assets as of September 30, 2017. See Note 5: Deferred Charges, Goodwill and Other Assets, Net.Rental Property Held for Sale, NetThe Company identified as held for sale six office properties totaling approximately 1.3 million square feet as of September 30, 2017. The properties are located in Parsippany, Woodcliff Lake, Paramus and Rochelle Park, New Jersey. The total estimated sales proceeds from the sales are expected to be approximately $132 million. The Company determined that the carrying value of three of the office properties was not expected to be recovered from estimated net sales proceeds and accordingly recognized an unrealized loss allowance of $25.7 million as of September 30, 2017.Rockpoint TransactionOn February 27, 2017, the Company, Roseland Residential Trust (“RRT”), the Company’s wholly-owned subsidiary through which the Company conducts its multi-family residential real estate operations, Roseland Residential, L.P. (“RRLP”), the operating partnership through which RRT conducts all of its operations, and certain other affiliates of the Company entered into an equity investment agreement (the “Investment Agreement”) with Rockpoint Group, L.L.C. and certain of its affiliates (collectively, “Rockpoint”). The Investment Agreement provides for multiple equity investments by Rockpoint in RRLP from time to time for up to an aggregate of $300 million of equity units of limited partnership interests of RRLP (the “Rockpoint Units”). The initial closing under the Investment Agreement occurred on March 10, 2017 for $150 million of Rockpoint Units, inclusive of a $30 million deposit paid by Rockpoint to RRLP on signing the Investment Agreement. Additional closings of Rockpoint Units to be issued and sold to Rockpoint pursuant to the Investment Agreement may occur from time to time in increments of not less than $10 million per closing, with the balance of the full $300 million by March 1, 2019.RRLP has been identified as a variable interest entity in which the Company is deemed to be the primary beneficiary. As of September 30, 2017 and December 31, 2016, the Company’s consolidated RRLP entity had total assets of $1.8 billion and $1.3 billion, respectively, total mortgages & loan payable of $698.8 million and $480.7 million, respectively, and other liabilities of $87.3 million and $40.1 million, respectively.The Company shall have a participation right, where prior to March 1, 2022 and following either the full investment of $300 million by Rockpoint or in certain other limited circumstances, the Company may purchase up to $200 million of equity units on substantially the same terms and conditions as the Rockpoint Units to be issued and sold to Rockpoint.RRT serves as the General Partner of the operating partnership and will receive contributed equity value at closing of $1.23 billion.Under the terms of the transaction, the cash flow from operations of RRLP will be distributable to RRT and Rockpoint as follows:first, to provide a 6% annual return to Rockpoint (and to the Company upon acquisition of equity units by the Company, as described above) on its invested capital (“Preferred Base Return”);second, to provide a 6% annual return to RRT on the equity value of the properties contributed by it to the partnership (“RRT Base Return”) with 95% of the RRT Base Return to RRT and 5% of the RRT Base Return to Rockpoint; andthird, pro rata between Rockpoint (and the Company upon acquisition of equity units) and RRT based on total respective invested capital and contributed equity value (approximately 17% to Rockpoint and 83% to RRT upon full investment of Rockpoint’s $300 million commitment and the Company’s $200 million participation right).RRLP’s cash flow from capital events will generally be distributable to RRT and Rockpoint as follows:first, to Rockpoint (and the Company upon acquisition of equity units) to the extent there is any unpaid, accrued Preferred Base Return;second, as a return of capital to Rockpoint (and the Company upon acquisition of equity units);third, to RRT to the extent there is any unpaid, accrued RRT Base Return (with Rockpoint entitled to an additional amount equal to 5% of the amounts distributable to RRT);fourth, as a return of capital to RRT based on the equity value of the properties contributed by it to the partnership (with Rockpoint entitled to an additional amount equal to 5% of the amounts distributable to RRT);fifth, pro rata between Rockpoint (and the Company upon acquisition of equity units) and RRT based on total respective invested capital and contributed equity value (approximately 17% to Rockpoint and 83% to RRT upon full investment of Rockpoint’s $300 million commitment and the Company’s $200 million participation right) until Rockpoint has achieved an 11% internal rate of return; andsixth, to Rockpoint (and to the Company upon acquisition of equity units) based on 50% of its pro rata share described in “fifth” above and the balance to RRT (approximately 9% to Rockpoint and 91% to RRT upon full investment of Rockpoint’s $300 million commitment and the Company’s $200 million participation right).In general, RRLP may not sell its properties in a taxable transaction, although it may engage in tax-deferred like-kind exchanges of properties or it may proceed in another manner designed to avoid the recognition of gains for tax purposes.Except in the case of a sale of RRLP or an initial public offering or spin-off of RRT (“Liquidity Events”), Rockpoint’s interest in the Rockpoint Units may not be redeemed or repurchased by RRT for a period of approximately five years from the initial closing under the Investment Agreement (“Lockout Period”). If there is a Liquidity Event during the Lockout Period, RRT may acquire Rockpoint’s Rockpoint Units for a purchase price generally equal to the greater of (i) the fair market value of such Rockpoint Units as determined by the process set forth below; or (ii) an amount that provides Rockpoint with 1.5 times Rockpoint’s return of capital taking into account prior distributions to Rockpoint (an “Early Repurchase”). Beginning on March 1, 2022, either RRT or Rockpoint may cause an acquisition (a “Put/Call Event”) of all, but not less than all, of Rockpoint’s interest in the Rockpoint Units at the fair market value per unit based on a net asset value (“NAV”) of RRLP to be determined by a third party valuation to be completed within ninety (90) calendar days of March 1, 2022 and every year thereafter and generally based on the capital event waterfall described above. Any acquisition of Rockpoint’s interest in the Rockpoint Units pursuant to a Put/Call Event is generally required to be structured as a purchase of the common equity in the applicable Rockpoint entities that hold direct or indirect interests in the Rockpoint Units. Subject to certain exceptions, Rockpoint also shall have a right of first offer and a participation right with respect to other common equity interests of RRLP or any subsidiary of RRLP that may be offered for sale by RRLP or its subsidiaries from time to time. On a Put/Call Event, other than the sale of RRLP, Rockpoint may elect to convert all, but not less than all, of its investment to common equity in RRLP.The foregoing and following terms and conditions of the investment will be implemented by the parties pursuant to an amended and restated partnership agreement of RRLP (the “Partnership Agreement”) and shareholders agreement of RRT (the “Shareholders Agreement”) to be entered into at the initial closing of the Rockpoint Units to be issued and sold to Rockpoint. Pursuant to thePartnership Agreement and Shareholders Agreement, and concurrent with the issuance and sale of the Rockpoint Units to be issued and sold at the initial closing, RRT has agreed to increase the size of its board of trustees from five to six persons, with five trustees being designated by the Company and one trustee being designated by Rockpoint.In addition, RRT and RRLP shall be required to obtain Rockpoint’s consent with respect to:· Debt financings in excess of a 65% loan-to-value ratio;· Corporate level financings that are pari-passu or senior to the Rockpoint Units;· New investment opportunities to the extent the opportunity requires an equity capitalization in excess of 10% of RRLP’s NAV;· New investment opportunities located in a Metropolitan Statistical Area where RRLP owns no property as of the previous quarter;· Declaration of bankruptcy of RRT;· Transactions between RRT and the Company, subject to certain limited exceptions;· Any equity granted or equity incentive plan adopted by RRLP or any of its subsidiaries; and· Certain matters relating to the Discretionary Demand Promissory Note between the Operating Partnership and RRLP (other than ordinary course borrowings or repayments thereunder).The Partnership Agreement provides that any of the following will constitute an event of default (each, an “Event of Default”) with respect to the equity securities: (i) failure by RRLP to pay Rockpoint any financial obligations due to it, subject to certain cure rights, (ii) any of the General Partner, Operating Partnership, RRT or RRLP, or their respective affiliates that are party to the Investment Agreement, failing to perform or observe any material covenant or agreement contained in any of the transaction documents and such failure continues for 20 business days after notice, or (iii) the violation of certain tax related covenants. If an Event of Default occurs, (i) at any time and is continuing, subject to a cure period, Rockpoint’s preferred return in respect of operating cash flows shall increase from six percent (6%) to eighteen percent (18%) per annum; and (ii) during the Lockout Period, if it remains uncured for 120 days after notice, Rockpoint may cause an Early Repurchase of Rockpoint’s interest in the Rockpoint Units by RRT. In addition, if any nonpayment of a financial obligation remains unpaid for 120 days following notice from Rockpoint, and remains uncured following the 10th anniversary of the effective date of the Partnership Agreement, Rockpoint shall have the right to designate a majority of the members of the board of trustees of RRT, which is the General Partner of RRLP.Also on the initial closing date, the Operating Partnership and RRLP executed a Discretionary Demand Promissory Note, whereby the Operating Partnership may provide periodic cash advances to RRLP. The Discretionary Demand Promissory Note provides for an interest rate equal to the London Inter-Bank Offered Rate plus fifty (50) basis points above the applicable interest rate under the Company’s unsecured revolving credit facility. The maximum aggregate principal amount of advances at any one time outstanding under the Note will be limited to $25,000,000.RRT and RRLP also entered into a registration rights agreement (the “Registration Rights Agreement”) with Rockpoint pursuant to which RRT and RRLP have agreed to register the Rockpoint Units or securities issuable in exchange of Rockpoint Units under certain circumstances in the future, in the event RRT or RRLP becomes a publicly traded company.The Operating Partnership and RRLP also entered into a Shared Services Agreement (the “Shared Services Agreement”), which will provide for the performance of back office, administrative and other operational services by the Operating Partnership for the benefit of RRLP. The Shared Services Agreement provides for a fixed fee of $1,000,000/year to be paid by RRLP to the Operating Partnership, with a three percent (3%) increase year to year.In connection with the transaction,July 25, 2023, the Company also entered into a Recourse Agreementrevolving credit and term loan agreement (“2023 Credit Agreement”) that provides for a $60 million senior secured revolving credit facility (the “Recourse Agreement”“2023 Revolving Credit Facility”) with Rockpoint. The Recourse Agreement provides that, in the eventand a $115 million senior secured term loan facility (the “2023 Term Loan”), of distributions or transfers by RRLP of cash flow or property in breach of the Partnership Agreement, or failure to make required distributions or payments (including complying with any put by Rockpoint) in each case, which remain uncured, the Company will have direct liability for losses of Rockpoint resulting therefrom.Rockpoint will indemnify the Company (or its affiliates) pursuant to an indemnity agreement (the “Indemnity Agreement”) for liability (pursuant to the provisions of said agreement) resulting from the likely requirement for RRLP to acquire the equity interest of the entities holding Rockpoint’s interest in RRLP upon any Rockpoint exit, including for losses relating to certain REIT matters.Unconsolidated Joint Venture ActivityOn January 31, 2017, the Company sold its interest in KPG-P 100 IMW JV, LLC, Keystone-Penn and Keystone-Tristate joint ventures that own operating properties, located in Philadelphia, Pennsylvania for an aggregate sales price of $9.7 million and realized a gaindrew down on the sale of the unconsolidated joint venture of $7.4 million.On February 15, 2017, the Company sold its 7.5 percent interest in Elmajo Urban Renewal Associates, LLCentire $115 million 2023 Term Loan and Estuary Urban Renewal Unit B, LLC joint ventures that own operating multi-family properties located in Weehawken, New Jersey for a sales price of $5.1 million and realized a gain on the sale of the unconsolidated joint venture of $5.1 million.On September 21, 2017, the RoseGarden Monaco, L.L.C. joint venture agreement was terminated. Accordingly, the Company wrote off the carrying value of its investment in the joint venture and recorded a loss of $1.4 million on the disposition of its joint venture interest.On September 29, 2017, the Company sold its interest in KPG-MCG Curtis joint venture that own an operating property located in Philadelphia, Pennsylvania for a sales price of $102.5 million which included the retirement of the Company’s share in the debt of $75 million and realized a gain on sale of the unconsolidated joint venture of $12 million. $8.9$52 million of the net sales proceeds from this sale were held by a qualified intermediary,2023 Revolving Credit Facility, which is considered nonalong with cash on hand, was used to complete the Rockpoint Redemption. For more information about the Rockpoint Purchase Agreement, 2023 Revolving Credit Facility, and recorded in deferred charges, goodwill and other assets. See Note 5: Deferred Charges, Goodwill and2023 Term Loan, see Part II, Item 5. Other Assets, Net.— Investments in Unconsolidated Joint Ventures —– to the Financial Statements, for the Company’s treatment of unconsolidated joint venture interests. Intercompany accounts and transactions have been eliminated.entity’sentity's activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; (2) the equity investment at risk is insufficient to finance that entity’s activities without additional subordinated financial support; or (3) the equity investors have voting rights that are not proportionate to their economic interests and substantially all of the activities of the entity involve or are conducted on behalf of an investor with a disproportionately small voting interest. The Company consolidates VIEs in which it is considered to be the primary beneficiary. The primary beneficiary is defined by the entity having both of the following characteristics: (1) the power to direct the activities that, when taken together, most significantly impact the variable interest entity’s performance: and (2) the obligation to absorb losses and right to receive the returns from the VIE that would be significant to the VIE.On January 1, 2016, the Company adopted accounting guidance under ASC 810, Consolidation, modifying the analysis it must perform to determine whether it should consolidate certain types of legal entities. guidance does not amend the existing disclosure requirements for variable interest entities or voting interest model entities. The guidance, however, modified the requirements to qualify under the voting interest model. Under the revised guidance, the Operating Partnership will be a variable interest entity of the parent company, Mack-Cali Realty Corporation. As the Operating Partnership is already consolidated in the balance sheets of Mack-Cali Realty Corporation, the identification of this entity as a variable interest entity has no impact on the consolidated financial statements of Mack-Cali Realty Corporation. There were no other legal entities qualifying under the scope of the revised guidance that were consolidated as a result of the adoption.The Financial Statements have been prepared in conformity with generally accepted accounting principles (“GAAP”). The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Financial Statements,financial statements and the reported amounts of revenues and expenses during the reportedreporting period. Actual results could differ from these estimates. Certain reclassifications have been made to prior period amounts in order to conform with current period presentation. These estimates and assumptions are based on management’s historical experience that are believed to be reasonable at the time. However, because future events and their effects cannot be determined with certainty, the determination of estimates requires the exercise of judgment. Actual results could differ from those estimates. Certain reclassifications have been made to prior period amounts in order to conform with current period presentation, primarily related to classification of certain properties as discontinued operations. The Company’s critical accounting policies are those which require assumptions to be made about matters that are highly uncertain. Different estimates could have a material effect on the Company’s financial results. Judgments and uncertainties affecting the application of these policies and estimates may result in materially different amounts being reported under different conditions and circumstances.Rental Property:Rental properties are stated at cost less accumulated depreciation and amortization. Costs directly related toacquisition, development and construction of rental properties are capitalized. Acquisition-related costs were expensed as incurred throughCompany’s audited Annual Report on Form 10-K for the year ended December 31, 2016. The Company early adopted the recently issued FASB guidance Accounting Standards Update (“ASU”) 2017-012022, as certain disclosures in this Quarterly Report on January 1, 2017 which revises the definition of a business and is expected to result in more transactions to be accounted for as asset acquisitions and significantly limit transactionsForm 10-Q that would be accounted for as business combinations. Where an acquisition has been determined to be an asset acquisition, acquisition-related costs are capitalized. Capitalized development and construction costs include pre-construction costs essential to the development of the property, development and construction costs, interest, property taxes, insurance, salaries and other project costs incurred during the period of development. Interest capitalized by the Company for the nine months ended September 30, 2017 and 2016 was $14.0 million and $14.4 million, respectively. Ordinary repairs and maintenance are expensed as incurred; major replacements and betterments, which improve or extend the life of the asset, are capitalized and depreciated over their estimated useful lives. Fully-depreciated assets are removed from the accounts.The Company considers a construction project as substantially completed and held available for occupancy upon the substantial completion of tenant improvements, but no later than one year from cessation of major construction activity (as distinguished from activities such as routine maintenance and cleanup). If portions of a rental project are substantially completed and occupied by tenants, or held available for occupancy, and other portions have not yet reached that stage, the substantially completed portions are accounted for as a separate project. The Company allocates costs incurred between the portions under construction and the portions substantially completed and held available for occupancy, primarily based on a percentage of the relative square footage of each portion, and capitalizes onlyduplicate those costs associated with the portion under construction.Properties are depreciated using the straight-line method over the estimated useful lives of the assets. The estimated useful lives are as follows:Leasehold interestsRemaining lease termBuildings and improvements5 to 40 yearsTenant improvementsThe shorter of the term of the related lease or useful lifeFurniture, fixtures and equipment5 to 10 yearsUpon acquisition of rental property, the Company estimates the fair value of acquired tangible assets, consisting of land, building and improvements, and identified intangible assets and liabilities assumed, generally consisting of the fair value of (i) above and below market leases, (ii) in-place leases and (iii) tenant relationships. The Company allocates the purchase price to the assets acquired and liabilities assumed based on their fair values. The Company records goodwill or a gain on bargain purchase (if any) if the net assets acquired/liabilities assumed differ from the purchase consideration of a transaction. In estimating the fair value of the tangible and intangible assets acquired, the Company considers information obtained about each property as a result of its due diligence and marketing and leasing activities, and utilizes various valuation methods, such as estimated cash flow projections utilizing appropriate discount and capitalization rates, estimates of replacement costs net of depreciation, and available market information. The fair value of the tangible assets of an acquired property considers the value of the property as if it were vacant.Above-market and below-market lease values for acquired properties are initially recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to each in-place lease and (ii) management’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases and the remaining initial term plus the term of any below-market fixed rate renewal options for below-market leases. The capitalized above-market lease values are amortized as a reduction of base rental revenue over the remaining terms of the respective leases, and the capitalized below-market lease values are amortized as an increase to base rental revenue over the remaining initial terms plus the terms of any below-market fixed rate renewal options of the respective leases.Other intangible assets acquired include amounts for in-place lease values and tenant relationship values, which are based on management’s evaluation of the specific characteristics of each tenant’s lease and the Company’s overall relationship with the respective tenant. Factors to be considered by management in its analysis of in-place lease values include an estimate of carrying costs during hypothetical expected lease-up periods considering current market conditions, and costs to execute similar leases. In estimating carrying costs, management includes real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease-up periods, depending on local market conditions. In estimating costs to execute similar leases, management considers leasing commissions, legal and other related expenses. Characteristics considered by management in valuing tenant relationships include the nature and extent of the Company’s existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals. The value of in-place leases are amortized to expense over the remaining initial terms of the respective leases. The value of tenant relationship intangibles are amortized to expense over the anticipated life of the relationships.On a periodic basis, management assesses whether there are any indicators that the value of the Company’s rental properties held for use may be impaired. In addition to identifying any specific circumstances which may affect a property or properties, management considers other criteria for determining which properties may require assessment for potential impairment. The criteria considered by management include reviewing low leased percentages, significant near-term lease expirations, current and historical operating and/or cash flow losses, near-term mortgage debt maturities and/or other factors, including those that might impact the Company’s intent and ability to hold the property. A property’s value is impaired only if management’s estimate of the aggregate future cash flows (undiscounted and without interest charges) to be generated by the property is less than the carrying value of the property. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying value of the property over the fair value of the property. The Company’s estimates of aggregate future cash flows expected to be generated by each property are based on a number of assumptions. These assumptions are generally based on management’s experience in its local real estate markets and the effects of current market conditions. The assumptions are subject to economic and market uncertainties including, among others, demand for space, competition for tenants, changes in market rental rates, and costs to operate each property. As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the future cash flows estimated by management in its impairment analyses may not be achieved, and actual losses or impairments may be realizedincluded in the future.Rental Property Held for Sale:When assets10-K are identified by management as held for sale, the Company discontinues depreciating the assets and estimates the sales price, net of selling costs, of such assets. The Company generally considers assets to be held for sale when the transaction has received appropriate corporate authority and there are no significant contingencies relating to the sale. If,not included in management’s opinion, the estimated net sales price, net of selling costs, of the assets which have been identified as held for sale is less than the carrying value of the assets, a valuation allowance is established.If circumstances arise that previously were considered unlikely and, as a result, the Company decides not to sell a property previously classified as held for sale, the property is reclassified as held and used. A property that is reclassified is measured and recorded individually at the lower of (a) its carrying value before the property was classified as held for sale, adjusted for any depreciation (amortization) expense that would have been recognized had the property been continuously classified as held and used, or (b) the fair value at the date of the subsequent decision not to sell.Investments in Unconsolidated Joint Ventures:The Company accounts for its investments in unconsolidated joint ventures under the equity method of accounting. The Company applies the equity method by initially recording these investments at cost, as Investments in Unconsolidated Joint Ventures, subsequently adjusted for equity in earnings and cash contributions and distributions. The outside basis portion of the Company’s joint ventures is amortized over the anticipated useful lives of the underlying ventures’ tangible and intangible assets acquired and liabilities assumed. Generally, the Company would discontinue applying the equity method when the investment (and any advances) is reduced to zero and would not provide for additional losses unless the Company has guaranteed obligations of the venture or is otherwise committed to providing further financial support for the investee. If the venture subsequently generates income, the Company only recognizes its share of such income to the extent it exceeds its share of previously unrecognized losses.If the venture subsequently makes distributions and the Company does not have an implied or actual commitment to support the operations of the venture, including a general partner interest in the investee, the Company will not record a basis less than zero, rather such amounts will be recorded as equity in earnings of unconsolidated joint ventures.On a periodic basis, management assesses whether there are any indicators that the value of the Company’s investments in unconsolidated joint ventures may be impaired. An investment is impaired only if management’s estimate of the value of the investment is less than the carrying value of the investment, and such decline in value is deemed to be other than temporary. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying value of the investment over the value of the investment. The Company’s estimates of value for each investment (particularly in real estate joint ventures) are based on a number of assumptions that are subject to economic and market uncertainties including, among others, demand for space, competition for tenants, changes in market rental rates, and operating costs. As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the values estimated by management in its impairment analyses may not be realized, and actual losses or impairment may be realized in the future. See Note 4: Investments in Unconsolidated Joint Ventures — to the Financial Statements.Revenue Recognition:Base rental revenue is recognized on a straight-line basis over the terms of the respective leases. Unbilled rents receivable represents the cumulative amount by which straight-line rental revenue exceeds rents currently billed in accordance with the lease agreements.Above-market and below-market lease values for acquired properties are initially recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to each in-place lease and (ii) management’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases and the remaining initial term plus the term of any below-market fixed-rate renewal options for below-market leases. The capitalized above-market lease values for acquired properties are amortized as a reduction of base rental revenue over the remaining terms of the respective leases, and the capitalized below-market lease values are amortized as an increase to base rental revenue over the remaining initial terms plus the terms of any below-market fixed-rate renewal options of the respective leases.Escalations and recoveries from tenants are received from tenants for certain costs as provided in the lease agreements. These costs generally include real estate taxes, utilities, insurance, common area maintenance and other recoverable costs.Real estate services revenue includes property management, development, construction and leasing commission fees and other services, and payroll and related costs reimbursed from clients. Fee income derived from the Company’s unconsolidated joint ventures (which are capitalized by such ventures) are recognized to the extent attributable to the unaffiliated ownership interests.Parking income includes income from parking spaces leased to tenants and others.Other income includes income from tenants for additional services arranged for by the Company and income from tenants for early lease terminations.Allowance for Doubtful Accounts:Management performs a detailed review of amounts due from tenants to determine if an allowance for doubtful accounts is required based on factors affecting the collectability of the accounts receivable balances. The factors considered by management in determining which individual tenant receivable balances, or aggregate receivable balances, require a collectability allowance include the age of the receivable, the tenant’s payment history, the nature of the charges, any communications regarding the charges and other related information. Management’s estimate of the allowance for doubtful accounts requires management to exercise significant judgment about the timing, frequency and severity of collection losses, which affects the allowance and net income.ninesix months ended SeptemberJune 30, 20172023 (“2017”2023”), as compared to the three and ninesix months ended SeptemberJune 30, 20162022 (“2016”2022”), make reference to the following: the effect of the “Same-Store“Same-Store Properties,” which represent all in-service properties owned by the Company at June 30, 2016 (for the three-month period comparisons), and which represent all in-service properties owned by the Company at December 31, 2015 (for the nine-month period comparisons),2021 excluding properties that were sold, disposed of, removed from service, or being redeveloped or repositioned from January 1, 20162022 through SeptemberJune 30, 2017; 2023; the effect of the “Acquired“Acquired and Developed Properties,” which represent all properties acquired by the Company or commencing initial operations from July 1, 2016 through September 30, 2017 (fort the three-month period comparisons), and which represent all properties acquired by the Company or commencing initial operations from January 1, 20162022 through SeptemberJune 30, 2017 (for the nine-month period comparisons)2023; and the effect of “Properties Sold,”“Properties Sold”, which represent properties sold, disposed of, or removed from service (including properties being redeveloped or repositioned) by the Company from January 1, 20162022 through SeptemberJune 30, 2017. During 2017 and 2016, four office properties, aggregating 352,027 square feet, were removed from service as they were being redeveloped by the Company.SeptemberJune 30, 20172023 Compared to Three Months Ended SeptemberJune 30, 2016(dollars in thousands) Three Months Ended June 30, Dollar
ChangePercent
Change2023 2022 Revenue from rental operations and other: Revenue from leases $ 61,909 $ 47,313 $ 14,596 30.8 % Parking income 4,796 4,173 623 14.9 Other income 1,381 1,431 (50) (3.5) Total revenues from rental operations 68,086 52,917 15,169 28.7 Property expenses: Real estate taxes 7,860 7,911 (51) (0.6) Utilities 2,379 1,895 484 25.5 Operating services 14,044 13,100 944 7.2 Total property expenses 24,283 22,906 1,377 6.0 Non-property revenues: Real estate services 643 896 (253) (28.2) Total non-property revenues 643 896 (253) (28.2) Non-property expenses: Real estate services expenses 4,389 2,920 1,469 50.3 General and administrative 9,582 11,527 (1,945) (16.9) Transaction related costs 3,319 1,345 1,974 146.8 Depreciation and amortization 23,684 21,015 2,669 12.7 Land and other impairments, net — 3,900 (3,900) (100.0) Total non-property expenses 40,974 40,707 267 0.7 Operating income (loss) 3,472 (9,800) 13,272 135.4 Other (expense) income: Interest expense (21,692) (14,741) (6,951) (47.2) Interest cost of mandatorily redeemable noncontrolling interests (13,390) — (13,390) (100.0) Interest and other investment income 3,927 189 3,738 1977.8 Equity in earnings of unconsolidated joint ventures 2,700 2,638 62 (2.4) Gain (loss) on disposition of developable land — 55,125 (55,125) (100.0) Loss from extinguishment of debt, net (2,657) (129) (2,528) 1,959.7 Other income, net 853 — 853 100.0 Total other (expense) income (30,259) 43,082 (73,341) (170.2) Loss (income) from continuing operations (26,787) 33,282 (60,069) 180.5 Discontinued operations: (Loss) income from discontinued operations 140 5,808 (5,668) (97.6) Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net (3,488) (4,440) 952 (21.4) Total discontinued operations (3,348) 1,368 (4,716) (344.7) Net (loss) income $ (30,135) $ 34,650 $ (64,785) 187.0 % 20172023, as compared to 20162022, divided into Same-Store Properties, Acquired and Developed Properties and Properties Sold in 20162022 and 2017 (dollars in thousands)2023 (excluding properties classified as discontinued operations):Base rents. Base rents(dollars in
thousands)Total
CompanySame-Store
PropertiesAcquired and Developed
Properties Properties
Sold in 2022 and 2023Dollar
Change Percent
ChangeDollar
Change Percent
ChangeDollar
ChangePercent
ChangeDollar
ChangePercent
ChangeRevenue from rental Revenue from leases $ 14,596 30.8 % $ 5,158 10.9 % $ 9,438 19.9 % $ — — % Parking income 623 14.9 373 8.9 279 6.7 (29) (0.7) Other income (50) (3.5) (50) (3.5) — — — — Total $ 15,169 28.7 % $ 5,481 10.4 % $ 9,717 18.4 % $ (29) (0.1) % Property expenses: Real estate taxes $ (51) (0.6) % $ (608) (7.7) % $ 561 7.1 % $ (4) (0.1) % Utilities 484 25.5 272 14.4 212 11.2 — — Operating services 944 7.2 (409) (3.1) 1,359 10.4 (6) — Total $ 1,377 6.0 % $ (745) (3.3) % $ 2,132 9.3 % $ (10) — % OTHER DATA: Number of Consolidated Properties 23 21 2 — 1,616 1,616 — — Multifamily portfolio (number of units) 5,535 4,545 990 — $0.1$5.2 million, or 0.110.9 percent, for 20172023 as compared to 2016,2022, due primarily to an $0.80 increase in average commercial office annual rents per square foot to $24.92 from $24.12 for 2017 as compared to 2016.Escalationsmarket rental rates and recoveries. Escalations and recoveries from tenants fora reduction in concessions of the Same-Store Properties increased $1.3 million, or 8.3 percent, for 2017 over 2016 due primarily to higher property expenses to recover in 2017.$1.6$0.4 million, or 47.68.9 percent, for 20172023 as compared to 2016,2022 due primarily to recordingincreased usage at the parking revenues, net of expenses,garages in 2016 and recording parking revenue, without netting expenses, in 2017, with such change in presentation resulting in minor period changes.decreased $1.1 million, or 62.4 percent, for 2017 as compared to 2016, due primarily to proceeds from a litigation settlement received in 2016. Other income for the Acquired Properties increased $2.8 million, due primarily to increased lease breakage fees recognized in 2017.onfor the Same-Store Properties increased $1.3decreased $0.6 million, or 6.27.7 percent, for 20172023 as compared to 2016,2022, due primarily to prior period tax appeal refunds received on several properties offset by increased rates.decreased $0.4increased $0.3 million, or 2.814.4 percent, for 20172023, as compared to 2016,2022, primarily due primarily to lower rates in 2017 as compared to 2016.Services.services. Operating services for the Same-Store Properties increased $0.1 million, or 0.4 percent, due primarily to recording parking revenue, net of expenses, in 2016 and recording parking revenue, without netting expenses, in 2017, with such charge in presentation resulting in minor period charges.decreased $0.9remained relatively unchanged.13.650.3 percent for 2017 as compareddue to 2016, due primarily to decreased third party development andincreased management activity in multi-family services in 2017 as compared to 2016.Real estate services expense. Real estate services expense decreased $0.2 million, or 2.4 percent, for 2017 as compared to 2016, due primarily to decreased compensation and related costs.$0.9$1.9 million, or 6.216.9 percent, in 2017for 2023 as compared to 2016,2022. This decrease was due primarily to a decrease in salarieshigher severance and related expensescosts in 2017 as compared to 2016.$4.3$2.7 million, or 8.8 percent, for 2017 over 2016.12.7 percent. This increase was primarily due primarily to depreciationan increase of $13.5 million in 2017 on the Acquired Properties, partially offset by lower depreciation of $6.2 million in 2017 as compared to 2016 for properties sold or removed from service and a decrease of $3.0$2.6 million for 2017 as compared to 2016Acquired and Developed Properties.the Same-Store Properties due to assets becoming fully amortized.$1.4$7.0 million, or 5.847.2 percent, for 20172023 as compared to 2016. This2022. The increase wasis primarily related to increases in LIBOR and SOFR rates as well as a reduction in capitalized interest in 2023 compared to 2022 due to Haus25 being placed in service during 2022.resultsecond quarter of higher average debt balances partially offset by lower average2023, the Company recognized $13.4 million in interest rates achieved on refinanced debt in late 2016.Interestcost of mandatorily redeemable noncontrolling interests related to Rockpoint's interests, including $7.6 million redemption value adjustment and other investment income.$5.8 million income attributed to noncontrolling interests.decreased $0.5(loss). Interest income increased $3.7 million, or 39.61,977.8 percent, for 2017 as2023 compared to 2016, due2022. The increase is primarily related to lower average notes receivable balancesinterest income for sales proceeds deposits in 2017. (loss) of unconsolidated joint ventures. Equity in earnings of unconsolidated joint ventures decreased $23.3increased $0.1 million or 107.0 percent, for 20172023 as compared to 2016. The decrease was2022, due primarily to 2016 equity earnings income of $21.7 million from refinancing proceeds received in 2016 from the Company’s South Pier at Harborside venture in excessimproved operating performance of its carrying value, with no similar activityunconsolidated joint ventures due to higher occupancy and rental rates.2017.RealizedJersey City, New Jersey.net. The Company had realized gains (unrealized losses) on disposition of rental propertyand impairments, net, of a net gain of $31.3$3.5 million in 2017, as compared to a net loss of $17.1and $4.4 million, in 2016.Gainrespectively, on sale of investment in unconsolidated joint venture. The Company recorded a $12 million gain on the sale in 2017 of its interests in certain joint ventures.these properties. See Note 3: Recent Transactions — Unconsolidated Joint Venture Activity —7: Discontinued Operations to the Financial Statements.Gain (loss) from early extinguishment of debt, net. In 2016, the Company recognized a $19.3 million loss on early extinguishment of debt from the repayment of certain Senior Unsecured Notes. See Note 9 to the Financial Statements: Mortgages, Loans Payable and Other Obligations.Net income (loss). Net income (loss) increased to net income of $44.7 million in 2017 from, a loss of $9.6 million in 2016. The increase of approximately $54.3 million was due to the factors discussed above.NineSeptemberJune 30, 20172023 Compared to NineSix Months Ended SeptemberJune 30, 2016(dollars in thousands) Six Months Ended June 30, Dollar
ChangePercent
Change2023 2022 Revenue from rental operations and other: Revenue from leases $ 121,747 $ 91,256 $ 30,491 33.4 % Parking income 9,129 7,760 1,369 17.6 Hotel income — — — — Other income 3,258 2,491 767 30.8 Total revenues from rental operations 134,134 101,507 32,627 32.1 Property expenses: Real estate taxes 18,980 16,201 2,779 17.2 Utilities 4,882 4,247 635 15.0 Operating services 26,307 25,964 343 1.3 Total property expenses 50,169 46,412 3,757 8.1 Non-property revenues: Real estate services 1,554 1,807 (253) (14.0) Total non-property revenues 1,554 1,807 (253) (14.0) Non-property expenses: Real estate services expenses 6,332 5,283 1,049 19.9 General and administrative 19,865 30,976 (11,111) (35.9) Transaction related costs 4,347 1,345 3,002 223.2 Depreciation and amortization 47,331 39,456 7,875 20.0 Property impairments — — — — Land and other impairments, net 3,396 6,832 (3,436) (50.3) Total non-property expenses 81,271 83,892 (2,621) (3.1) Operating loss 4,248 (26,990) 31,238 (115.7) Other (expense) income: Interest expense (43,706) (26,348) (17,358) 65.9 Interest cost of mandatorily redeemable noncontrolling interests (13,390) — (13,390) (100.0) Interest and other investment income 4,043 347 3,696 1065.1 Equity in earnings of unconsolidated joint ventures 2,633 2,151 482 22.4 Realized gains (losses) and unrealized gains (losses) on disposition of rental property, net — — — — Gain (loss) on disposition of developable land (22) 57,748 (57,770) (100.0) Gain (loss) on sale of unconsolidated joint venture interests — — — — Loss from extinguishment of debt, net (2,657) (129) (2,528) 1959.7 Other Income, net 2,851 — 2,851 100.0 Total other (expense) income (50,248) 33,769 (84,017) (248.8) (Loss) income from continuing operations (46,000) 6,779 (52,779) (778.6) Discontinued operations: Income from discontinued operations 2,344 25,948 (23,604) (91.0) Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net (2,709) (2,604) (105) 4.0 Total discontinued operations (365) 23,344 (23,709) (101.6) Net (loss) income $ (46,365) $ 30,123 $ (76,488) (253.9) % 20172023, as compared to 20162022, divided into Same-Store Properties, Acquired and Developed Properties and Properties Sold in 20162022 and 2017 (dollars in thousands)2023 (excluding properties classified as discontinued operations):Base rents. Base rents(dollars in
thousands)Total
CompanySame-Store
PropertiesAcquired and Developed
PropertiesProperties
Sold in 2022 and 2023Dollar
ChangePercent
ChangeDollar
ChangePercent
ChangeDollar
ChangePercent
ChangeDollar
ChangePercent
ChangeRevenue from rental Revenue from leases $ 30,491 33.4 % $ 10,778 11.8 % $ 19,713 21.3 % $ — — % Parking income 1,369 17.6 918 11.8 545 7.0 (94) (1.2) Hotel income — — — — — — — — Other income 767 30.8 679 27.3 88 3.5 — — Total $ 32,627 32.1 % $ 12,375 12.2 % $ 20,346 20.0 % $ (94) (0.1) % Property expenses: Real estate taxes $ 2,779 17.2 % $ 1,005 6.2 % $ 1,852 11.4 % $ (78) (0.5) % Utilities 635 15.0 40 0.9 595 14.0 — — Operating services 343 1.3 (3,285) (12.7) 3,668 14.1 (40) (0.2) Total $ 3,757 8.1 % $ (2,240) (4.8) % $ 6,115 13.2 % $ (118) 0.3 % OTHER DATA: Number of Consolidated Properties 23 21 2 — 1,616 1,616 — — Multifamily portfolio (number of units) 5,535 4,545 990 — $7.5$10.8 million, or 1.911.8% percent, for 20172023 as compared to 2016,2022, due primarily to a $1.11an increase in average commercial office annual rents per square foot to $24.79 from $23.68 for 2017 as compared to 2016; partially offset bymarket rental rates and a 90 basis point decreasereduction in the average same store percent leasedconcessions of the office portfolio to 89.1 percent from 90.0 percent.Escalations and recoveries. Escalations and recoveries from tenantsmultifamily rental properties.$3.7$0.9 million, or 8.111.8 percent, for 2017 over 20162023 as compared to 2022 due primarily to higher property expensesincreased usage at the parking garages in 2023 as compared to recover2022.2017.Parking income. Parking incomeJersey City, New Jersey offset by prior period tax appeal refunds received on several properties.32.912.7 percent, for 20172023 as compared to 2016, due primarily to recording parking revenues, net of expenses, in 2016 and recording parking revenue, without netting expenses, in 2017, with such change in presentation resulting in minor period changes.Other income. Other income for the Same-Store Properties decreased $1.1 million, or 26.4 percent, for 2017 as compared to 2016, due primarily to proceeds from a litigation settlement received in 2016. Other income for the Acquired Properties increased $6.1 million,lease breakage fees recognized in 2017.Real estate taxes. Real estate taxes on the Same-Store Properties increased $2.2 million, or 3.3 percent, for 2017 as compared to 2016, due primarily to increased rates.Utilities. Utilities for the Same-Store Properties decreased $0.6 million, or 1.5 percent, for 2017 as compared to 2016, due primarily to decreased electricity rates in 2017 as compared to 2016.Operating Services. Operating services for the Same-Store Properties increased $5.1 million, or 6.7 percent, due primarily to an increase inrepairs and maintenance and services costs of $2.2 million for 2017 as compared to 2016, an increase in salaries and related expenses of $1.1 million for 2017 as compared to 2016, as well as recording parking revenue, net of expenses, in 2016 and recording parking revenue, without netting expenses, in 2017, with such charge in presentation resulting in minor period charges.decreased $2.0remained relatively unchanged.9.819.9 percent for 2017 as compareddue to 2016, due primarily to decreased third party development andincreased management activity in multi-family services in 2017 as compared to 2016.Real estate services expense. Real estate services expense decreased $1.0 million, or 5.4 percent, for 2017 as compared to 2016, due primarily to decreased compensation and related costs.$1.8$11.1 million, in 2017or 35.9 percent, for 2023 as compared to 2016,2022. This decrease was due primarily to a decrease in salarieshigher severance and related expenses.Acquisition-related costs. The Company incurred transaction costs of $2.9 million in 2016 related to the Company’s property2022 and joint venture acquisitions, which were expensed for the period.$23.1$7.9 million, or 17.2 percent, for 2017 over 2016.20.0 percent. This increase was primarily due primarily to depreciation of $35.0 million in 2017 on the Acquired Properties, and an increase of $2.9$7.4 million for 2017Acquired and Developed Properties,2016 on the Same-Store Properties2022. The increase is primarily related to increases in LIBOR and SOFR rates as well as a reduction in capitalized interest in 2023 compared to 2022 due to accelerated depreciation on buildings planningHaus25 being placed in service during 2022.be removed from service, partially offset by lower depreciation of $14.8 million in 2017 as comparedRockpoint's interests, including $7.6m redemption value adjustment and $5.8m income attributed to 2016 for properties sold or removed from service.Interest expense. Interest expense decreased $1.3 million, or 1.7 percent, for 2017 as compared to 2016. This decrease was primarily the result of lower average interest rates achieved on refinanced debt in late 2016, partially offset by increased debt balances in 2017.Interest and other investment income.noncontrolling interests.$0.6$3.7 million, or 1,977.8 percent, for 2017 over 2016,2023 compared to 2022. The increase is primarily as a result of a valuation mark-to-market lossrelated to interest income for an interest rate swap recorded in 2016 with no similar loss in 2017.decreased $24.5increased $0.5 million or 124.9 percent, for 20172023 as compared to 2016. The decrease was2022, due primarily to a decrease in equity earnings income of $21.7 million from refinancing proceeds received in 2016 from the Company’s South Pier at Harborside venture in excessimproved operating performance of its carrying value, with no similar activity in 2017,unconsolidated joint ventures due to higher occupancy and an equity loss in 2017 of $5.2 million from the Company’s URL Harborside venture, which was placed in service in 2017 but is currently in the lease-up stage.changedisposition of control of interests.developable land. In 2016,2022, the Company recordedrecognized a gain of $57.7 million on changethe sale of controldevelopable land parcels located in Jersey City and West Windsor, New Jersey.$15.3$2.9 million.connection with2023 and $25.9 million in 2022. In 2023 and 2022, the acquisitions of the remaining interests of multifamily properties located in Malden and East Boston, Massachusetts.RealizedCompany recognized realized gains (losses) and unrealized losses on disposition of rental property net. The Company had realized gains (unrealized losses) on disposition of rental propertyand impairments, net, of a net lossgain of $2.1$2.7 million in 2017, as compared to $68.7and $2.6 million, in net gains from dispositions in 2016.Gainrespectively, on sale of investment in unconsolidated joint venture. The Company recorded a $23.1 million gain on the sale in 2017 of its interests in certain joint ventures. The Company also recorded a $5.7 million gain on the sale in 2016 of an unconsolidated joint venture property located in Weehawken, New Jersey.these properties. See Note 3: Recent Transactions — Unconsolidated Joint Venture Activity —7: Discontinued Operations to the Financial Statements.Gain (loss) from extinguishment of debt, net. In 2017, the Company recognized a loss from extinguishment of debt of $0.2 million due to the allocated costs as a result of the amendment of its revolving credit facility in 2017. In 2016, the Company recognized a $6.9 million loss on early extinguishment of debt due to costs of the early repayment of certain Senior Unsecured Notes. See Note 7 to the Financial Statements: Senior Unsecured Notes and Note 8 to the Financial Statements: Unsecured Revolving Credit Facility and Term Loans.Net income (loss). Net income (loss) decreased to net income of $28.3 million in 2017 from net income of $113.5 million in 2016. The decrease of approximately $85.2 million was due to the factors discussed above.:Historically, rentalhas beenis the Company’s principal source of funds to pay its material cash commitments consisting of operating expenses, debt service, capital expenditures and dividends, excluding non-recurring capital expenditures. To the extent that the Company’s cash flow from operating activities is insufficient to finance its non-recurring capital expenditures such as property acquisitions, development and construction costs and other capital expenditures, the Company has and expects to continue to finance such activities through borrowings under its unsecured revolving credit facility, other debt and equity financings, proceeds from the sale of properties and joint venture capital.officerental properties and land, and net cash provided by operating activitiesactivities.its unsecured revolving credit facility. TheCompany frequently examines potential property acquisitions and development projects and, at any given time, one or more of such acquisitions or development projects may be under consideration. Accordingly, the ability to fund property acquisitions and development projects is a major partRockpoint all of the Company’s financing requirements. The Company expects to meet its financing requirements through funds generated from operating activities, toPreferred Units that constituted the extent available, proceeds from property sales, joint venture capital, long-term and short-term borrowings (including draws on the Company’s unsecured revolving credit facility) and the issuancePut/Call Interests for an aggregate purchase price of additional debt and/or equity securities.Repositioning$520 million (the "Rockpoint Redemption"). See Part II, Item 5, for a discussion of the Company’s Portfolio:As described earlier relative to its current strategic initiative, the Company’s management has been reviewing its portfolioterms and identifying opportunities to divest of non-core office properties that no longer meet its long-term strategy, have reached their potential, are less efficient to operate, or when market conditions are favorable to be sold at attractive prices. The Company anticipates redeploying the proceeds from non-core rental property sales in the near-term to acquire office properties, enhance amenities and infrastructure at existing office properties, develop, redevelop and acquire multi-family rental properties, as well as reposition certain office properties into multi-family residential and/or mixed use properties, in its core Northeast sub-markets.Construction Projects:In 2015, the Company commenced development of a two-phase multi-family development of the CitySquare project in Worcester, Massachusetts. The first phase, with 237 units, is under construction with anticipated initial deliveries in the first quarter 2018. The second phase, with 128 units, started construction in the third quarter 2016 with anticipated initial deliveries in the third quarter 2018. Total development costs for both phases are estimated to be $92 million with development costspurchase of $70.6 million incurred through September 30, 2017. The Company has a construction loan with a maximum borrowing amount of $58 million (with $27.8 million outstanding as of September 30, 2017). The Company does not expect to fund additional costs for the completion of the project as future development costs will be funded by using the loan financings.In 2015, the Company entered into a 90-percent owned joint venture with XS Port Imperial Hotel, LLC to form XS Hotel Urban Renewal Associates LLC, which is developing a 372-key hotel in Weehawken, New Jersey. The project is expected to be ready for occupancy by second quarter 2018. The construction of the project is estimated to cost $139.4 million, with development costs of $87.6 million incurred by the venture through September 30, 2017. The venture has a $94 million construction loan (with $31 million outstanding as of September 30, 2017). The Company does not expect to fund additional costs for the completion of the project as future development costs will be funded by using the loan financing.In 2016, the Company commenced the repurposing of a former office property site in Morris Plains, New Jersey into a 197-unit multi-family development project. The project, which is estimated to cost $58.7 million of which development costs of $45 million have been incurred through September 30, 2017, is expected to be ready for occupancy by the first quarter of 2018. The project costs are expected to be funded primarilythese interests from a $42 million construction loan (with $22.7 million outstanding as of September 30, 2017).In 2016, the Company started construction of a 296-unit multi-family project in East Boston, Massachusetts. The project is expected to be ready for occupancy by first quarter 2018 and is estimated to cost $111.4 million of which development costs of $81 million have been incurred through September 30, 2017. The remaining project costs are expected to be funded primarily from a $73 million construction loan (with $32 million outstanding as of September 30, 2017).The Company is developing a 295-unit multi-family project in Weehawken, New Jersey, which began construction in first quarter 2016. The project, which is expected to be ready for occupancy by first quarter 2018, is estimated to cost $125 million (of which development costs of $72.8 million have been incurred through September 30, 2017). The project costs are expected to be funded primarily from a $78 million construction loan (with $37.8 million outstanding as of September 30, 2017). The Company expects to fund $47 million for the development of the project, of which the Company has funded $34.4 million as of September 30, 2017.The Company is developing a 310-unit multi-family project in Conshohocken, Pennsylvania, which began construction in third quarter 2016 with anticipated initial occupancy in first quarter 2020. The project is estimated to cost $89.4 million (of which development costs of $22.9 million have been incurred through September 30, 2017). The project costs are expected to be funded primarily through borrowings under the Company’s unsecured revolving credit facility.On August 11, 2017, the Company acquired an existing mortgage note receivable encumbering a vacant developable land parcel located in Jersey City, New Jersey (the “Land Property”) with a current principal balance of $44,695,187 (the “Land Note Receivable”). The Land Note Receivable matures in July 2019 and earns interest at an annual rate of 5.85 percent which accrues monthly and is payable at maturity. The Land Property is currently an unimproved land parcel which operates as a surface parking facility. Additionally, the Company entered into an agreement to acquire the Land Property, subject to the Company’s ability to obtain all necessary development rights and entitlements to develop an apartment building on the land, and other related conditions to ensure that the Company can develop the project. The purchase price is $73,000,000, subject to adjustment based on the level of development rights obtained for the construction of a multifamily apartment building.: Moreover, the General Partner intends to continue to make regular quarterly distributions to its common stockholders. Based upon the most recently paid common stock dividend rate of $0.20 per common share, in the aggregate, such distributions would equal approximately $71.9 million ($81.2 million, including units in the Operating Partnership, held by parties other than the General Partner) on an annualized basis. However, any such distributions, whether for federal income tax purposes or otherwise, would be paid out of available cash, including borrowings and other sources, after meeting operating requirements, preferred stock dividends and distributions, and scheduled debt service on the Company’s debt. If and to the extent the Company retains and does not distribute any net capital gains, the General Partner will be required to pay federal, state and local taxes on such net capital gains at the rate applicable to capital gains of a corporation.Property Lock-Ups:Through February 2016, the Company could not dispose of or distribute certain of its properties which were originally contributed by certain unrelated common unitholdersOperating Partnership, without the express written consent of such common unitholders, as applicable, except in a manner which did not result in recognition of any built-in-gain (which may result in an income tax liability) or which reimbursed the appropriate specific common unitholders for the tax consequencescompletion of the recognitionCompany’s transformation to a pure-play multifamily REIT, as well as the Company’s current estimates of such built-in-gains (collectively,taxable income, the “Property Lock-Ups”). The aforementioned restrictions did not apply in the event that the Company sold all of its properties or in connection with a sale transaction which the General Partner’s Board of Directors determined was reasonably necessary to satisfy a material monetary default on any unsecured debt, judgment or liability of the Company or to cure any material monetary default on any mortgage secured by a property. The Property Lock-Ups expired in February 2016. Upon the expiration of the Property Lock-Ups, the Company is generally required to use commercially reasonable efforts to prevent any sale, transfer or other disposition of the subject properties from resulting in the recognition of built-in gain to the specific common unitholders, which include members of the Mack Group (which includes William L. Mack, Chairman of the General Partner’sPartner (the "Board of Directors") has decided to reinstate a quarterly dividend beginning with the third quarter of 2023. The Company will reevaluate its dividend as the Company completes the sale of non-strategic asset sales.Directors; David S. Mack, director;Directors in light of conditions then existing, including the Company’s earnings, cash flows, financial condition, capital requirements, debt maturities, the availability of debt and Earle I. Mack,equity capital, applicable REIT and legal restrictions and the general overall economic conditions and other factors.former director), the Robert Martin Group (which includes Robert F. Weinberg, a former director and current member$0.05 dividend per common share to be payable on October 10, 2023 to shareholders of record as of the General Partner’s Advisory Board),close of business on September 30, 2023.the Cali Group (which includes John R. Cali, a former directordistributions payable at June 30, 2023 and current member of the General Partner’s Advisory Board). December 31, 2022 represent amounts payable on unvested LTIP units.SeptemberJune 30, 2017, 83 of the Company’s properties, with an aggregate carrying value of approximately $1.0 billion, have lapsed restrictions and are subject to these conditions.Unencumbered Properties:As of September 30, 2017,2023, the Company had 132three unencumbered propertiesproperty with a carrying value of $2.2 billion$173.1 million representing 88.713.0 percent of the Company’s total consolidated property count. and cash equivalents and restricted cash increased by $57.2$376.9 million to $88.8$424.6 million at SeptemberJune 30, 2017,2023, compared to $31.6$47.6 million at December 31, 2016.2022. This increase is comprised of the following net cash flow items: $162.6$24.4 million provided by operating activities. $504.7$451.6 million used inprovided by investing activities, consisting primarily of the following: $19.3$6.5 million used for investmentsreceived from proceeds from the sales of rental property; plus(b) $543.4used for rental property acquisitions and related intangibles; plus(c) $67.8received from repayment of notes receivable; minusimprovements;other costs; plus(d) $47 million used for investments in notes receivable; plus $201.5$5.6 million used for the development of rental property, other related costs and deposits; minus $8$3.2 million decrease in restricted cash; minus(g) $241.4 million from proceeds from the sales of rental property; minus(h) $9.6insurance settlement.received from repayments of notes receivables; minus(i) $107 million from proceeds from the sale of investmentused in unconsolidated joint venture; minus(j) $4.7 million received from distributions in excess of cumulative earnings from unconsolidated joint ventures; minus(k) $3.6 million received from proceeds from investment receivable.(3) $399.2 million provided by financing activities, consisting primarily of the following: $428 million from borrowings under the revolving credit facility; plus(b) $325 million from borrowings from the unsecured term loan; plus(c) $395.9 million from proceeds received from mortgages and loans payable; plus(d) $139 million from issuance of redeemable noncontrolling interests; minus(e) $714facility; minus(f) $108.5facility and term loan; plusminus(g) $55.1pluspayments of dividends and distributions; minus(h) $9.1distribution to redeemable noncontrolling interests; plusfinance cost;financing costs; minus(i) $2used for acquisition of noncontrolling interests.Debt:SeptemberJune 30, 2017:Weighted Average
Maturity in YearsFixed Rate & Hedged Secured (a) $ 1,827,230 100.00 % 4.32 % 3.22 Totals/Weighted Average: $ 1,827,230 100.00 % 4.32 % 3.22 Unamortized deferred financing costs (6,249) Total Debt, Net $ 1,820,981 The actual weighted average LIBORIncludes debt with interest rate for the Company’scaps outstanding variable rate debt was 1.23 percent aswith a notional amount of September 30, 2017, plus the applicable spread.(b) Excludes amortized deferred financing costs primarily pertaining to the Company’s unsecured revolving credit facility which amounted to $0.8 million and $2.6 million for the three and nine months ended September 30, 2017.:SeptemberJune 30, 20172023 are as follows:Period Weighted Avg.
Effective Interest Rate of
Future Repayments (a)2023 $ 1,790 $ 58,998 $ 60,788 3.58 % 2024 5,037 605,324 610,361 5.02 % 2025 8,384 — 8,384 3.39 % 2026 8,780 483,000 491,780 4.23 % 2027 8,158 305,319 313,477 3.66 % Thereafter 7,418 335,022 342,440 3.98 % Sub-total 39,567 1,787,663 1,827,230 4.32 % Unamortized deferred financing costs (6,249) — (6,249) Totals/Weighted Average $ 33,318 $ 1,787,663 $ 1,820,981 4.32 % LIBOR rateof floating rates (SOFR) for the Company’s outstanding variable rate debt was 1.235.14 percent as of SeptemberJune 30, 2017,2023, plus the applicable spread.(b) Excludes amortized deferred financing costs primarily pertaining to the Company’s unsecured revolving credit facility which amounted to $0.8 million and $2.6 million for the three and nine months ended September 30, 2017.Senior Unsecured Notes:The terms of the Company’s senior unsecured notes (which totaled approximately $825.0 million as of September 30, 2017) include certain restrictions and covenants which require compliance with financial ratios relating to the maximum amount of debt leverage, the maximum amount of secured indebtedness, the minimum amount of debt service coverage and the maximum amount of unsecured debt as a percent of unsecured assets.Unsecured :January 25, 2017,May 6, 2021, the Company entered into an amendeda revolving credit facility and new term loan agreement (“20172021 Credit Agreement”) with a group of 13 lenders. Pursuant to the 2017 Credit Agreement, the Company refinanced its existing $600seven lenders that provides for a $250 million unsecuredsenior secured revolving credit facility (“2017(the “2021 Credit Facility”) and a $150 million senior secured term loan facility (the “2021 Term Loan”), and terminated the 2017 credit agreement on May 13, 2021.new $325revolving credit and term loan agreement (“2023 Credit Agreement”) with a group of two lenders that provides for a $60 million unsecured, delayed-drawsenior secured revolving credit facility (the “2023 Revolving Credit Facility”) and a $115 million senior secured term loan facility (“2017(the “2023 Term Loan”).20172023 Revolving Credit Facility include: (1) a four-yearone-year term ending in January 2021, with twoJuly 2024, subject to one six-month extension options;option; (2) revolving credit loans may be made to the Company in an aggregate principal amount of up to $600 million (subject to increase$60 million; (3) a first priority lien in unencumber property known as discussed below), withThe James, a sublimit under the 2017 Credit Facility for the issuance of letters of credit in an amount not to exceed $60 million (subject to increase as discussed below); (3) an interest rate based on the Operating Partnership’s unsecured debt ratings from Moody’s or S&P, currently the London Inter-Bank Offered Rate (“LIBOR”) plus 120 basis points, or,240 unit multi-family residential property located at the Operating Partnership’s option, if it no longer maintains a debt rating from Moody’s or S&P or such debt ratings fall below Baa3 and BBB-, based on a defined leverage ratio;87 Madison Avenue, Park Ridge, New Jersey (the “Collateral Pool Property”); and (4) a facilitycommitment fee payable quarterly basedequal to 35 basis points per annum on the Operating Partnership’s unsecured debt ratings from Moody’s or S&P, currently 25 basis points, or, atdaily unused amount of the Operating Partnership’s option, if it no longer maintains a debt rating from Moody’s or S&P or such debt ratings fall below Baa3 and BBB-, based on a defined leverage ratio.The interest rates on outstanding borrowings, alternate base rate loans and the facility fee on the current borrowing capacity payable quarterly in arrears on the 20172023 Revolving Credit Facility are based upon the Operating Partnership’s unsecured debt ratings, as follows:If the Company elected to use the defined leverage ratio, the interest rate under the 2017 Credit Facility would be based on the following total leverage ratio grid:20172023 Term Loan include:included: (1) a three-yearone-year term ending in January 2020, with two one-yearJuly 2024, subject to one six-month extension options;option; (2) multiple drawsa single draw of the term loan commitments may be made within 12 months of the effective date of the 2017 Credit Agreement up to an aggregate principal amount of $325 million (subject to increase as discussed below), with no requirement to be drawn$115 million; and (3) a first priority lien in full; provided, that, if the Company does not borrow at least 50 percent of the initial term commitment from the term lenders (i.e. 50 percent of $325 million)Collateral Pool Property. or before July 25, 2017, the amount of unused term loan commitments shall be reduced on such date so that, after giving effect to such reduction, the amount of unused term loan commitments is not greater than the outstanding term loans on such date; (3) an interest rate based on the Operating Partnership’s unsecured debt ratings from Moody’s or S&P, currently the LIBOR plus 140 basis points, or, at the Operating Partnership’s option if it no longer maintains a debt rating from Moody’s or S&P or such debt ratings fall below Baa3 and BBB-, based on a defined leverage ratio; and (4) a term commitment fee on any unused term loan commitment during the first 12 months after the effective date of the 2017 Credit Agreement at a rate of 0.25 percent per annum on the sum of the average daily unused portion of the aggregate term loan commitments.On March 22, 2017, the Company drew the full $325 million available under the 2017 Term Loan. On March 29, 2017, the Company executed interest rate swap arrangements to fix LIBOR with an aggregate average rate of 1.6473% for the swaps and a current aggregate fixed rate of 3.0473% for borrowings under the 2017 Term Loan.The interest rate on the 20172023 Revolving Credit Facility and 2023 Term Loan is based upon Operating Partnership’s unsecured debt ratings, as follows:If the Company elected to use the defined leverage ratio, the interest rate under the 2017 Term Loan wouldshall be based on applicable interest rate (the “Interest Rate”) plus a margin ranging from 250 basis points to 350 basis points (the “Applicable Margin”) depending on the following total leverage ratio grid:On upInterest Rate elected, currently 3.5%. With respect to four occasions at any time after the effective date of the 2017 Credit Agreement, the Company may elect to request (1) an increase to the existing revolving credit commitments (any such increase, the “New Revolving Credit Commitments”) and/or (2) the establishment of one or more new term loan commitments (the “New Term Commitments”, together with the 2017 Credit Commitments, the “Incremental Commitments”), by up to an aggregate amount not to exceed $350 million for all Incremental Commitments. The Company may also request that the sublimit for letters of credit available under the 2017 Credit Facility be increased to $100 million (without arranging any New Revolving Credit Commitments). No lender or letter of credit issued has any obligation to accept any Incremental Commitment or any increase to the letter of credit subfacility. There is no premium or penalty associated with full or partial prepayment of borrowings under the 2017 Credit Agreement.The 2017 Credit Agreement, which applies to both the 20172023 Revolving Credit Facility and 2017the 2023 Term Loan, the Interest Rate shall be either (A) the Alternative Base Rate plus the Applicable Margin and/or (B) the Adjusted Term SOFR Rate plus the Applicable Margin or, with respect to the 2023 Revolving Credit(to the extent that: (i) such property dispositions cause the Company to default on any of the financial ratios of the 2017 Credit Agreement (described below), or (ii) the property dispositions are completed while the Company is under an event of default under the 2017 Credit Agreement, unless, under certain circumstances, such disposition is being carried out to cure such default), and which require compliance with financial ratios relating to (a) the maximum total leverage ratio (60(65 percent), (b) the minimum debt service coverage ratio (1.25 times), (c) the minimum tangible net worth ratio (80% of tangible net worth as of July 25, 2023 plus 80% of net cash proceeds of equity issuances by the General Partner or the Operating Partnership), and (d) the maximum amountunhedged variable rate debt ratio (30%). Subject to certain exceptions, the net proceeds from any property sales are to be used to mandatorily repay the 2023 Term Loan until it is retired. In addition, the 2023 Credit Agreement includes a mandatory cash sweep provision that provides that any cash, cash equivalents or marketable securities of secured indebtedness (40 percent), the minimum amountGeneral Partner or Operating Partnership in excess of fixed charge coverage (1.5 times),$25 million as of the maximum amountend of unsecured indebtedness (60 percent), the minimum amountlast business day of unencumbered property interest coverage (2.0 times)any calendar week shall be applied to repayment of any outstanding borrowings under the 2023 Credit Agreement.certain investment limitations (generally 15 percentrequire the immediate repayment of total capitalization).all outstanding borrowings under the 2023 Revolving Credit Facility. These change of control provisions, which have been an event of default under the agreements governing the Operating Partnership’s revolving credit facilities since June 2000, are triggered if, among other things, a majority of the seats on the Board of Directors (other than vacant seats) become occupied by directors who were neither nominated by the Board of Directors, nor appointed by the Board of Directors. If these change of control provisions were triggered, the Operating Partnership could seek a forbearance, waiver or amendment of the change of control provisions from the lenders, however there can be no assurance that the Operating Partnership would be able to obtain such forbearance, waiver or amendment on acceptable terms or at all. If an event of default has occurred and is continuing, the entire outstanding balance under the 20172023 Credit Agreement may (or, in the case of any bankruptcy event of default, shall) become immediately due and payable, and the CompanyOperating Partnership will not make any excess distributions except to enable the General Partner to continue to qualify as a REIT under the IRS Code.Before it amendedrestated its unsecured revolving credit facilityborrowed $52 million from the 2023 Revolving Credit Facility which proceeds, together with available cash, were used to fund the purchase price under the Rockpoint Purchase Agreement in January 2017,Part II, Item 5. On July 26, 2023, the Company hadpaid down a $600total of $27 million unsecured revolving credit facility with a group of 17 lenders that was scheduled to mature in July 2017. The interest rate on outstanding borrowings (not electing the Company’s competitive bid feature) and the facility fee on the current borrowing capacity payable quarterly in arrears was based upon the Operating Partnership’s unsecured debt ratings at the time, as follows:In January 2016, the Company obtained a $350 million unsecured term loan (“2016 Term Loan”), which matures in January 2019 with two one-year extension options. The interest rate for the term loan is currently 140 basis points over LIBOR, subject to adjustment on a sliding scale based on the Operating Partnership’s unsecured debt ratings, or, at the Company’s option, a defined leverage ratio. The Company entered into interest rate swap arrangements to fix LIBOR for the duration of the term loan. Including costs, the current all-in fixed rate is 3.13 percent. The proceeds from the loan were used primarily to repay outstanding borrowings on the Company’s then existing unsecured revolving credit facility and to repay $200 million senior unsecured notes that matured on January 15, 2016.The interest rate on the 2016 Term Loan is based upon the Operating Partnership’s unsecured debt ratings, as follows:Operating Partnership’sInterest Rate -Unsecured Debt Ratings:Applicable Basis PointsHigher of S&P or Moody’sAbove LIBORNo ratings or less than BBB-/Baa3185.0BBB- or Baa3 (current interest rate based on Company’s election)140.0BBB or Baa2115.0BBB+ or Baa1100.0A- or A3 or higher90.0If the Company elected to use the defined leverage ratio, the interest rate under the 2016 Term Loan would be based on the following total leverage ratio grid:Interest Rate -Applicable BasisTotal Leverage RatioPoints above LIBOR<45%145.0>45% and <50% (current ratio)155.0>50% and <55%165.0>55%195.0The terms of the 2016 Term Loan include certain restrictions and covenants which limit, among other things the incurrence of additional indebtedness, the incurrence of liens and the disposition of real estate properties (to the extent that: (i) such property dispositions cause the Company to default on any of the financial ratios of the term loan described below, or (ii) the property dispositions are completed while the Company is under an event of default under the term loan, unless, under certain circumstances, such disposition is being carried out to cure such default), and which require compliance with financial ratios relating to the maximum leverage ratio (60 percent), the maximum amount of secured indebtedness (40 percent), the minimum amount of fixed charge coverage (1.5 times), the maximum amount of unsecured indebtedness (60 percent), the minimum amount of unencumbered property interest coverage (2.0 times) and certain investment limitations (generally 15 percent of total capitalization). If an event of default has occurred and is continuing, the Company will not make any excess distributions except to enable the General Partner to continue to qualify as a REIT under the IRS Code.::does not intendintends to reserve funds to retire the Company’s senior unsecured notes, outstanding borrowings under its unsecured revolving credit facility, its unsecured term loans, or its mortgages, loans payableutilize a combination of corporate and other obligations upon maturity. Instead, theproperty level indebtedness. The Company will seek to refinance suchor retire its debt obligations at maturity with either available proceeds received from the Company’s planned non-strategic asset sales, as well as with new corporate or retire such debt through the issuance of additional equity or debt securitiesproperty level indebtedness on or before the applicable maturity dates. If it cannot raise sufficient proceeds to retire the maturing debt, the Company may drawuse cash on its revolving credit facilityhand to retirerepay the maturing indebtedness, which would reduce the future availability of funds under such facility. As of November 3, 2017, the Company had no outstanding borrowings under its unsecured revolving credit facility.debt. The Company is reviewing variouscontinually evaluating its financing and refinancing options, including the redemption or purchase of the Operating Partnership’s senior unsecured notes in public tender offers or privately-negotiated transactions, the issuance of additional, or exchange of current, unsecured debt of the Operating Partnership or common and preferred stock, of the General Partner, and/or obtaining additional mortgage debt of the Operating Partnership, some or all of which may be completed in 2017.2023. The Company currently anticipates that its available cash and cash equivalents, cash flows from operating activities and proceeds from the sale of office properties,real estate assetsmulti-familymultifamily rental sector arise, the Company’s ability to make the expected distributions discussed in “REIT Restrictions” above may be adversely affected.Common Equity:The following table presents the changes in the General Partner’s issued and outstanding shares of common stock and the Operating Partnership’s common units for the nine months ended September 30, 2017:Share/Unit Repurchase Program:The General Partner has a share repurchase program which was renewed and authorized by its Board of Directors in September 2012 to purchase up to $150 million of the General Partner’s outstanding common stock (“Repurchase Program”), which it may repurchase from time to time in open market transactions at prevailing prices or through privately negotiated transactions. As of September 30, 2017, the General Partner has a remaining authorization under the Repurchase Program of $139 million. There were no common stock repurchases in 2016 and through November 3, 2017.:5.55.4 million shares of the General Partner’s common stock have been reserved for future issuance. The DRIP provides for automatic reinvestment of all or a portion of a participant’s dividends from the General Partner’s shares of common stock. The DRIP also permits participants to make optional cash investments up to $5,000 a month without restriction and, if the Company waives this limit, for additional amounts subject to certain restrictions and other conditions set forth in the DRIP prospectus filed as part of the Company’s effective registration statement on Form S-3 filed with the Securities and Exchange Commission (“SEC”) for the approximately 5.55.4 million shares of the General Partner’s common stock reserved for issuance under the DRIP.:November 3, 2017.November 3, 2017.:provideprovides for recourse to the Company for customary matters such as intentional misuse of funds, environmental conditions and material misrepresentations. The Company has agreed to guarantee repayment of a portion of the debt of its unconsolidated joint ventures. Such debt has a total facility amount of $206 million of which the Company has agreed to guarantee up to $24.8 million. As of SeptemberJune 30, 2017,2023, the outstanding balance of such debt totaled $194.2$18.2 million of which $23.3$2 million was guaranteed by the Company.Contractual ObligationsThe following table outlines the timing of payment requirements related to the Company’s debt (principal and interest), PILOT agreements, ground lease agreements and other obligations, as of September 30, 2017:(a) Interest payments assume LIBOR rate of 1.23 percent, which is the weighted average rate on this outstanding variable rate debt at September 30, 2017, plus the applicable spread.(b) Interest payments assume LIBOR rate of 1.23 percent, which is the weighted average rate on its outstanding variable rate mortgage debt at September 30, 2017, plus the applicable spread.of unitholders,in Operating Partnership, computed in accordance with GAAP, excluding gains or losses from depreciable rental property transactions (including both acquisitions and dispositions), and impairments related to depreciable rental property, plus real estate-related depreciation and amortization. The Company believes that FFO is helpful to investors as one of several measures of the performance of an equity REIT. The Company further believes that as FFO excludes the effect of depreciation, gains (or losses) from sales of propertiesproperty transactions and impairments related to depreciable rental property (all of which are based on historical costs which may be of limited relevance in evaluating current performance), FFO can facilitate comparison of operating performance between equity REITs.ninesix months ended SeptemberJune 30, 20172023 and 20162022 (in thousands):Three Months Ended
June 30,Six Months Ended
June 30,2023 2022 2023 2022 Net (loss) income available to common shareholders $ (27,434) $ 26,373 $ (47,407) $ 17,281 Add (deduct): Noncontrolling interests in Operating Partnership (2,384) 2,568 (4,696) (305) Noncontrolling interests in discontinued operations (298) 127 (22) 2,102 Real estate-related depreciation and amortization on continuing operations (a) 26,064 23,413 52,053 44,352 Real estate-related depreciation and amortization on discontinued operations 275 6,863 5,231 14,784 Discontinued operations: Realized (gains) losses and unrealized (gains) losses on disposition of rental property, net 3,488 4,440 2,709 2,604 Funds from operations available to common stock and Operating Partnership unitholders (b) $ (289) $ 63,784 $ 7,868 $ 80,818 interest,interests, of $5,362 and $4,559$2.6 million for the three months ended SeptemberJune 30, 20172023 and 2016, respectively,2022 and $15,607 and $13,948$5.2 million for the ninesix months ended SeptemberJune 30, 20172023 and 2016, respectively.2022. Excludes non-real estate-related depreciation and amortization of $505$0.2 million and $305$0.3 million for the three months ended SeptemberJune 30, 20172023 and 2016,2022, respectively and $1,231$0.6 million and $717$0.7 million for the ninesix months ended SeptemberJune 30, 20172023 and 2016,2022, respectively.InflationThe Company’s leases with the majority of its commercial tenants provide for recoveries and escalation charges based upon the tenant’s proportionate share of, and/or increases in, real estate taxes and certain operating costs, which reduce the Company’s exposureincreases in operating costs resulting from inflation. The Company believes that inflation did not materially impact the Company’s results of operations and financial conditioncommon shareholders for the periods presented.·············2016.2022. We assume no obligation to update and supplement forward-looking statements that become untrue because of subsequent events, new information or otherwise.is the exposure tofrom its indebtedness primarily from loss resulting from changes in interest rates, foreign currency exchange rates, commodity prices and equity prices. In pursuing its business plan, the primary market risk to which the Company is exposed is interest rate risk. Changes in the general level of interest rates prevailing in the financial markets may affect the spread between the Company’s yield on invested assets and cost of funds and, in turn, its ability to make distributions or payments to its investors.$2.6$1.8 billion of the Company’s long-term debt as of SeptemberJune 30, 20172023 bears interest at fixed rates and therefore the fair value of these instruments is affected by changes in market interest rates. The following table presents principal cash flows (in thousands) based upon maturity dates of the debt obligations and the related weighted-average interest rates by expected maturity dates for the fixed rate debt. Theeffective interest rates on the Company’s variable rate debt as of SeptemberJune 30, 20172023 ranged from LIBORLIBOR/SOFR plus 187141 basis points to LIBORLIBOR/SOFR plus 950275 basis points. Assuming interest-rate swaps and caps are not in effect as of June 30, 2023, if market rates of interest on the Company’s variable rate debt increased or decreased by 100 basis points, then the increase or decrease in interest costs on the Company’s variable rate debt would be approximately $2.2$5.5 million annuallyannually. As of June 30, 2023, the Company's indebtedness with an aggregate principal balance of $1.8 billion had an estimated aggregate fair value of $1.7 billion and the increaseif market rates of interest increased or decrease indecreased by 100 basis points, the fair value of the Company’s fixed rate debt as of September 30, 2017March 31, 2022 would be approximately $90.0 million.
The following table presents principal cash flows (in thousands) based upon maturity dates of the debt obligations and the related weighted-average interest rates by expected maturity dates for the fixed rate debt.7/1/23 -
12/31/20232024 2025 2026 2027 Sub-total Other (a) Fixed Rate $ 60,788 $ 610,361 $ 8,384 $ 491,780 $ 313,477 $ 342,440 $ 1,827,230 $ (6,249) $ 1,820,981 $ 1,709,839 Weighted Average Interest Rate 3.58 % 5.02 % 3.39 % 4.23 % 3.66 % 3.98 % 4.32 % SeptemberJune 30, 2017..Reporting. Reporting. There have not been any changes in the General Partner’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the General Partner’s internal control over financial reporting.Mack-Cali Realty,reporting.MACK-CALI REALTY CORPORATIONMACK-CALI REALTY,reporting20162022 of the General Partner and the Operating Partnership. None.COMMON STOCK(b)hereto.MACK-CALI REALTY CORPORATIONMACK-CALI REALTY,hereto.ExhibitNumberExhibit Title4.34.44.54.64.74.84.94.104.114.124.134.144.154.164.174.18ExhibitNumberExhibit Title10.110.210.310.410.510.610.710.810.910.1010.1110.1210.1310.1410.1510.1610.1710.1810.19ExhibitNumberExhibit Title10.3210.3310.3410.3510.3610.3710.3810.3910.4010.4110.42ExhibitNumberExhibit Title10.4310.4410.4510.4610.4710.4810.4910.5010.5110.5210.5310.5410.5510.56ExhibitNumberExhibit Title10.5710.5810.5910.6010.6110.6210.6310.6410.6510.6610.6710.6810.69ExhibitNumberExhibit Title10.8310.8410.8510.8610.8710.8810.8910.9010.9110.9210.9310.9410.9510.96ExhibitNumberExhibit Title10.9710.9810.9910.10010.10110.10210.10310.10410.10510.10610.10710.10810.10910.11010.11110.112ExhibitNumberExhibit Title10.11310.11410.11510.11610.11710.11810.11910.12010.12110.12210.12310.12410.125ExhibitNumberExhibit Title10.12610.12710.12810.12910.13010.13110.13210.13310.13410.13510.13610.13710.13831.1*ExhibitNumberExhibit Title32.1* 32.1*Mack-Cali Realty CorporationVeris Residential, Inc. and Mack-Cali Realty,Veris Residential, L.P. from their combined Report on Form 10-Q for the quarter ended SeptemberJune 30, 20172023 formatted in Inline XBRL: (i) Consolidated Balance Sheets (unaudited), (ii) Consolidated Statements of Operations (unaudited), (iii) Consolidated Statements of Comprehensive Income (Loss) (unaudited), (iv) Consolidated Statements of Changes in Equity (unaudited), (iv)(v) Consolidated Statements of Cash Flows (unaudited) and (v)(vi) Notes to Consolidated Financial Statements (unaudited).104.1* The cover page from this Quarterly Report on Form 10-Q, formatted in Inline XBRL. MACK-CALI REALTY CORPORATIONMACK-CALI REALTY,Mack-Cali Realty Corporation(Registrant)Veris Residential, Inc. (Registrant) Date: November 7, 2017By:/s/ Michael J. DeMarcoDate: July 26, 2023 Michael J. DeMarco/s/ Mahbod Nia Mahbod Nia Chief Executive Officer (principal executive officer) November 7, 2017By:/s/ Anthony KrugAmanda LombardAnthony KrugAmanda Lombard Chief Financial Officer (principal financial officer and principal accounting officer) Mack-Cali Realty,Veris Residential, L.P. (Registrant) By:Mack-Cali Realty Corporation November 7, 2017July 26, 2023 /s/ Michael J. DeMarcoMahbod NiaBy:Michael J. DeMarcoMahbod Nia Chief Executive Officer (principal executive officer) November 7, 2017By:/s/ Anthony KrugAmanda LombardAnthony KrugAmanda Lombard Chief Financial Officer (principal financial officer and principal accounting officer)