Mack-Cali Realty Corporation (CLI) Q2 2020 Results Conference Call August 3, 2020 8:00 AM ET Company Participants Deidre Crockett - Executive Vice President and Chief Administrative Officer MaryAnne Gilmartin - Chair and Interim Chief Executive Officer Marshall Tycher - Chairman of Multifamily Platform Roseland Nicholas Hilton - Executive Vice President of Leasing David Smetana - Chief Financial Officer Conference Call Participants Manny Korchman - Citi Derek Johnson - Deutsche Bank Stephen Sakwa - Evercore ...

Explanatory Note [Explanatory Note](index=2&type=section&id=Explanatory%20Note) This combined report for Mack-Cali Realty Corporation and its Operating Partnership streamlines disclosure for a holistic business view - This is a combined Form 10-Q for Mack-Cali Realty Corporation (General Partner) and Mack-Cali Realty, L.P. (Operating Partnership)[9](index=9&type=chunk) - The General Partner is a REIT and serves as the sole general partner of the Operating Partnership, which conducts all business operations[10](index=10&type=chunk) - As of June 30, 2020, the General Partner owned approximately **90.4%** of the common unit interest in the Operating Partnership, with the remaining **9.6%** held by limited partners[11](index=11&type=chunk) - The main differences in the financial statements between the two entities lie in the presentation of shareholders' equity, partners' capital, and noncontrolling interests[16](index=16&type=chunk) Part I – Financial Information [Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements for the three and six months ended June 30, 2020 and 2019 [Mack-Cali Realty Corporation Financial Statements](index=6&type=section&id=Mack-Cali%20Realty%20Corporation%20Financial%20Statements) Mack-Cali Realty Corporation - Key Balance Sheet Data (in thousands) | Account | June 30, 2020 | December 31, 2019 | | :--- | :--- | :--- | | Total Assets | $5,360,012 | $5,292,798 | | Total Liabilities | $3,257,561 | $3,089,941 | | Total Equity | $1,593,496 | $1,699,475 | Mack-Cali Realty Corporation - Key Operational Results (in thousands, except per share amounts) | Metric | Three Months Ended June 30, 2020 | Three Months Ended June 30, 2019 | Six Months Ended June 30, 2020 | Six Months Ended June 30, 2019 | | :--- | :--- | :--- | :--- | :--- | | Total Revenues | $72,650 | $86,605 | $154,707 | $176,871 | | Net Income (Loss) | $(32,934) | $(20,329) | $(70,778) | $255,265 | | Net Income (Loss) available to common shareholders | $(34,887) | $(22,054) | $(74,811) | $222,441 | | Diluted EPS | $(0.41) | $(0.43) | $(0.88) | $2.24 | [Mack-Cali Realty, L.P. Financial Statements](index=12&type=section&id=Mack-Cali%20Realty%2C%20L.P.%20Financial%20Statements) Mack-Cali Realty, L.P. - Key Balance Sheet Data (in thousands) | Account | June 30, 2020 | December 31, 2019 | | :--- | :--- | :--- | | Total Assets | $5,360,012 | $5,292,798 | | Total Liabilities | $3,257,561 | $3,089,941 | | Total Equity | $1,593,496 | $1,699,475 | Mack-Cali Realty, L.P. - Key Operational Results (in thousands, except per unit amounts) | Metric | Three Months Ended June 30, 2020 | Three Months Ended June 30, 2019 | Six Months Ended June 30, 2020 | Six Months Ended June 30, 2019 | | :--- | :--- | :--- | :--- | :--- | | Total Revenues | $72,650 | $86,605 | $154,707 | $176,871 | | Net Income (Loss) | $(32,934) | $(20,329) | $(70,778) | $255,265 | | Net Income (Loss) available to common unitholders | $(38,576) | $(24,488) | $(82,715) | $247,687 | | Diluted EPU | $(0.41) | $(0.43) | $(0.88) | $2.24 | [Notes to Consolidated Financial Statements](index=18&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) - As of June 30, 2020, the Company's portfolio consisted of **71 properties**, including 41 office buildings (10.5 million sq ft), 22 multi-family properties (6,850 units), four parking/retail properties, and three hotels[51](index=51&type=chunk) - On December 19, 2019, the Company's Board decided to sell the entire suburban New Jersey office portfolio (6.6 million sq ft), now classified as **discontinued operations**[52](index=52&type=chunk)[110](index=110&type=chunk) - During Q2 2020, the Company recognized an unrealized loss allowance of **$11.9 million** and land impairments of **$16.8 million**, partly due to COVID-19 market conditions[114](index=114&type=chunk) - On July 24, 2020, CEO Michael J. DeMarco was terminated without cause, and Board Chair MaryAnne Gilmartin was appointed as interim CEO[197](index=197&type=chunk)[198](index=198&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=63&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses its strategic shift, operational results, liquidity, and the significant impact of the COVID-19 pandemic [Executive Overview and Strategic Direction](index=63&type=section&id=Executive%20Overview%20and%20Strategic%20Direction) - The company is executing a strategic transformation to concentrate on New Jersey Hudson River waterfront office properties and luxury multi-family rentals[296](index=296&type=chunk) - A key part of this strategy is the sale of the entire suburban New Jersey office portfolio (6.6 million sq ft), with proceeds intended to pay down corporate-level unsecured debt[298](index=298&type=chunk)[300](index=300&type=chunk) - The **COVID-19 pandemic** is identified as a key risk factor, potentially impairing tenants' ability to pay rent and reducing property demand[303](index=303&type=chunk) - The stabilized core commercial portfolio was **80.3% leased** at June 30, 2020, down from 81.1% at March 31, 2020, but up from 79.8% at June 30, 2019[304](index=304&type=chunk) [Results of Operations](index=71&type=section&id=Results%20of%20Operations) Comparison of Results: Three Months Ended June 30 (in thousands) | Line Item | 2020 | 2019 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Total Revenues | $72,650 | $86,605 | $(13,955) | (16.1)% | | Total Expenses | $93,833 | $88,417 | $5,416 | 6.1% | | Income (loss) from continuing operations | $(42,734) | $(22,479) | $(20,255) | (90.1)% | | Net Income (Loss) | $(32,934) | $(20,329) | $(12,605) | (62.0)% | - For Q2 2020 vs Q2 2019, same-store parking income decreased by **$2.4 million (44.4%)** and hotel income decreased by **$1.3 million (64.0%)**, primarily due to the COVID-19 pandemic[346](index=346&type=chunk) - General and administrative expenses increased by **$0.3 million (1.7%)** in Q2 2020, mainly due to higher costs ($5.0 million vs $4.1 million) related to contested elections for the Board of Directors[351](index=351&type=chunk) - Land and other impairments were **$16.8 million** in Q2 2020 compared to $2.5 million in Q2 2019[354](index=354&type=chunk) [Liquidity and Capital Resources](index=77&type=section&id=Liquidity%20and%20Capital%20Resources) - The company expects to meet short-term liquidity needs through working capital, proceeds from property sales (including $305.4 million of suburban office properties under contract), operating cash flow, and its unsecured revolving credit facility[385](index=385&type=chunk) - As of June 30, 2020, the company has three multi-family projects under construction with total estimated costs of **$711.8 million**, of which **$373.2 million** has been incurred[390](index=390&type=chunk)[391](index=391&type=chunk)[392](index=392&type=chunk) Debt Summary as of June 30, 2020 (in thousands) | Debt Type | Balance | % of Total | Weighted Avg. Interest Rate | | :--- | :--- | :--- | :--- | | Fixed Rate Unsecured | $575,000 | 19.11% | 4.09% | | Fixed Rate Secured | $1,769,695 | 58.81% | 3.79% | | Variable Rate Secured | $335,612 | 11.15% | 3.19% | | Variable Rate Unsecured | $329,000 | 10.93% | 1.48% | | **Total** | **$3,009,307** | **100.00%** | **3.53%** | [Funds from Operations (FFO)](index=87&type=section&id=Funds%20from%20Operations%20(FFO)) FFO Reconciliation (in thousands) | Metric | Three Months Ended June 30, 2020 | Three Months Ended June 30, 2019 | Six Months Ended June 30, 2020 | Six Months Ended June 30, 2019 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) available to common shareholders | $(34,887) | $(22,054) | $(74,811) | $222,441 | | **FFO available to common stock and OP unitholders** | **$5,004** | **$32,924** | **$34,675** | **$72,465** | [Quantitative and Qualitative Disclosures About Market Risk](index=90&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk on its variable-rate debt - The company's primary market risk exposure is to changes in interest rates[449](index=449&type=chunk) - A **100 basis point** change in interest rates would impact annual interest costs on variable-rate debt by approximately **$105.5 million**[450](index=450&type=chunk) [Controls and Procedures](index=90&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective following the implementation of a new accounting system - The CEO and CFO concluded that disclosure controls and procedures were **effective** for both the General Partner and the Operating Partnership as of June 30, 2020[453](index=453&type=chunk)[455](index=455&type=chunk) - In January 2020, the company implemented a new accounting and reporting software system, which necessitated updates to internal controls over financial reporting[454](index=454&type=chunk)[456](index=456&type=chunk) Part II – Other Information [Legal Proceedings](index=92&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no material pending legal proceedings outside of ordinary routine litigation - There are no material pending legal proceedings, other than ordinary routine litigation incidental to the business[459](index=459&type=chunk) [Risk Factors](index=92&type=section&id=Item%201A.%20Risk%20Factors) This section updates risk factors, focusing on the material uncertainty and risks presented by the COVID-19 pandemic - The **COVID-19 pandemic** presents material uncertainty and risk to the company's business, financial condition, and cash flows[461](index=461&type=chunk) - Specific risks highlighted include deterioration of tenant financial health, potential negative impact on planned asset dispositions, reduced demand for office and residential space, and difficulty accessing capital markets[462](index=462&type=chunk) [Other Information (Items 2-6)](index=93&type=section&id=Item%202-6.%20Other%20Information) This section notes that Items 2 through 5 are not applicable and refers to the Exhibit Index for Item 6 - Items 2, 3, 4, and 5 are reported as not applicable[464](index=464&type=chunk)[466](index=466&type=chunk) - Item 6 refers to the Exhibit Index for a list of filed exhibits[465](index=465&type=chunk)

[Part I - Financial Information](index=5&type=section&id=Part%20I%20Financial%20Information) This section presents the unaudited consolidated financial statements, management's analysis, market risk, and controls for Q1 2020 [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) Unaudited consolidated financial statements for Mack-Cali Realty Corporation and its operating partnership are presented, with detailed notes [Mack-Cali Realty Corporation Financial Statements](index=6&type=section&id=Mack-Cali%20Realty%20Corporation%20Financial%20Statements) Mack-Cali Realty Corporation reported a $39.9 million net loss for Q1 2020, reversing prior-year income due to property losses | Financial Metric | Three Months Ended March 31, 2020 (in thousands, except EPS) | Three Months Ended March 31, 2019 (in thousands, except EPS) | | :--- | :--- | :--- | | **Total Revenues** | $82,057 | $90,266 | | **Income (loss) from continuing operations** | $(32,091) | $267,366 | | **Net income (loss)** | $(37,844) | $275,594 | | **Net income (loss) available to common shareholders** | $(39,924) | $244,495 | | **Diluted EPS** | $(0.47) | $2.66 | | Balance Sheet Item | March 31, 2020 (in thousands) | December 31, 2019 (in thousands) | | :--- | :--- | :--- | | **Total Assets** | $5,285,532 | $5,292,798 | | **Total Liabilities** | $3,146,890 | $3,089,941 | | **Total Equity** | $1,632,160 | $1,699,475 | | Cash Flow Activity | Three Months Ended March 31, 2020 (in thousands) | Three Months Ended March 31, 2019 (in thousands) | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $43,663 | $46,037 | | **Net cash (used in) provided by investing activities** | $(83,098) | $28,888 | | **Net cash provided by (used in) financing activities** | $39,394 | $(91,857) | [Mack-Cali Realty, L.P. Financial Statements](index=11&type=section&id=Mack-Cali%20Realty%2C%20L.P.%20Financial%20Statements) Mack-Cali Realty, L.P. reported a $44.1 million net loss for Q1 2020, mirroring the Corporation's performance and balance sheet | Financial Metric (L.P.) | Three Months Ended March 31, 2020 (in thousands, except EPU) | Three Months Ended March 31, 2019 (in thousands, except EPU) | | :--- | :--- | :--- | | **Total Revenues** | $82,057 | $90,266 | | **Net income (loss)** | $(37,844) | $275,594 | | **Net income (loss) available to common unitholders** | $(44,139) | $272,175 | | **Diluted EPU** | $(0.47) | $2.66 | [Notes to Consolidated Financial Statements](index=16&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Detailed notes cover accounting policies, the strategic suburban office portfolio sale, debt structure, and segment reporting - The company's Board decided to sell the entire suburban New Jersey office portfolio, totaling approximately **6.6 million square feet**, classifying its results as discontinued operations[48](index=48&type=chunk)[105](index=105&type=chunk)[139](index=139&type=chunk) - In Q1 2020, the company recognized an unrealized loss allowance of **$53.0 million** on properties held for sale and land impairments of **$5.3 million**, citing recent sales contract amendments and COVID-19 economic challenges[108](index=108&type=chunk)[180](index=180&type=chunk) - The company is actively developing three large multi-family projects with total estimated costs of approximately **$711.8 million**, expected to complete between Q4 2020 and Q1 2022[198](index=198&type=chunk)[199](index=199&type=chunk)[200](index=200&type=chunk) - The estimated future redemption value of the Rockpoint Preferred Units, classified as redeemable noncontrolling interests, was approximately **$488 million** as of March 31, 2020[217](index=217&type=chunk) - Subsequent to quarter-end, on April 24, 2020, the company signed an agreement to sell its 111 River Street office property in Hoboken, New Jersey, for **$244.5 million**[291](index=291&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=58&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, strategic direction, and liquidity, focusing on the suburban office sale and COVID-19 [Executive Overview & Strategic Direction](index=58&type=section&id=Executive%20Overview%20%26%20Strategic%20Direction) The company is transforming to focus on waterfront office and multi-family assets, divesting its suburban office portfolio - The company's primary strategic initiative is the sale of its entire **suburban New Jersey office portfolio** to pay down corporate-level, unsecured indebtedness and focus on its waterfront office and multi-family rental portfolio[301](index=301&type=chunk)[303](index=303&type=chunk) - As of March 31, 2020, **17 properties** from the suburban portfolio, totaling **2.5 million square feet**, were under contract for sale for aggregate gross proceeds of **$335.5 million**[302](index=302&type=chunk) - The stabilized core operating commercial portfolio was **81.1% leased** at March 31, 2020, compared to **80.7%** at December 31, 2019, with rental rates on renewed leases increasing by an average of **19.7%** in Q1 2020[309](index=309&type=chunk) [Results of Operations](index=66&type=section&id=Results%20of%20Operations) The company reported a $37.8 million net loss in Q1 2020, a significant decline from Q1 2019 net income | Metric | Q1 2020 (in thousands) | Q1 2019 (in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | **Total Revenues** | $82,057 | $90,266 | (8.5)% | | **Net Income (Loss)** | $(37,844) | $275,594 | (113.7)% | | **Realized/Unrealized (Losses) Gains on Rental Property** | $(7,915) | $268,109 | (103.0)% | | **General & Administrative** | $15,818 | $13,319 | 18.8% | - Same-Store Properties revenue increased by **$1.0 million (1.3%)** while property expenses decreased by **$1.9 million (5.4%)** year-over-year[350](index=350&type=chunk) [Liquidity and Capital Resources](index=69&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity relies on operating cash flow, credit facilities, and asset sales, with $2.9 billion total debt | Debt Summary | As of March 31, 2020 (in thousands, except interest rate) | | :--- | :--- | | **Total Debt, Net** | $2,877,121 | | **Fixed Rate Debt** | $2,331,612 | | **Variable Rate Debt** | $545,509 | | **Weighted Average Interest Rate** | 3.70% | - The company plans to use the estimated net sales proceeds of approximately **$1.1 billion** from its Suburban Office Portfolio sale to pay down corporate-level, unsecured indebtedness[373](index=373&type=chunk) - As of May 6, 2020, the company had outstanding borrowings of **$326 million** under its unsecured revolving credit facility[408](index=408&type=chunk) [Funds from Operations (FFO)](index=78&type=section&id=Funds%20from%20Operations) FFO available to common stock and unit holders was $29.7 million in Q1 2020, a decrease from Q1 2019 | Metric | Three Months Ended March 31, 2020 (in thousands) | Three Months Ended March 31, 2019 (in thousands) | | :--- | :--- | :--- | | **Net income (loss) available to common shareholders** | $(39,924) | $244,495 | | **Funds from operations (FFO)** | $29,671 | $39,541 | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=81&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk, with significant fixed and variable rate debt exposure - A 100 basis point increase or decrease in market interest rates would change the company's annual interest costs on its variable rate debt by approximately **$5.5 million**[436](index=436&type=chunk) - As of March 31, 2020, the company's debt consisted of approximately **$2.3 billion** at fixed rates and **$552 million** at variable rates[436](index=436&type=chunk)[437](index=437&type=chunk) [Item 4. Controls and Procedures](index=81&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of March 31, 2020, following new accounting system implementation - Management concluded that disclosure controls and procedures were effective for both the General Partner and the Operating Partnership as of the end of the reporting period[439](index=439&type=chunk)[441](index=441&type=chunk) - In January 2020, the company implemented a new accounting and reporting software system and updated its internal controls over financial reporting to accommodate the change[440](index=440&type=chunk)[442](index=442&type=chunk) [Part II - Other Information](index=83&type=section&id=Part%20II%20Other%20Information) This section covers legal proceedings, updated risk factors (COVID-19), and a bylaw amendment for virtual stockholder meetings [Item 1. Legal Proceedings](index=83&type=section&id=Item%201.%20Legal%20Proceedings) The company is not a party to any material pending legal proceedings beyond routine litigation incidental to its business - There are no material pending legal proceedings, other than ordinary routine litigation incidental to the business[445](index=445&type=chunk) [Item 1A. Risk Factors](index=83&type=section&id=Item%201A.%20Risk%20Factors) This section updates risk factors to address material uncertainties and adverse effects of the COVID-19 pandemic - The COVID-19 pandemic is identified as a new material risk factor, presenting uncertainty that could have a material adverse effect on the company's business, operations, and financial condition[447](index=447&type=chunk) - Specific pandemic-related risks include deterioration in tenant financial health, reduced demand for office and multi-family space, difficulty accessing capital, and construction delays[448](index=448&type=chunk) [Item 5. Other Information](index=84&type=section&id=Item%205.%20Other%20Information) The company amended its bylaws on May 5, 2020, to permit annual stockholder meetings via remote communication - On May 5, 2020, the company amended its bylaws to permit the conduct of its annual meeting of stockholders solely by means of remote communication[451](index=451&type=chunk)

Financial Data and Key Metrics Changes - The company reported core FFO per share for Q1 2020 of $0.33, down from $0.40 in the prior year, primarily due to the disposition program [28] - The total portfolio had same-store NOI growth of 11.9% and revenue growth of 4.6% in Q1 2020 [29] - The net debt-to-EBITDA metric was 11.5x at quarter end, an increase from 9.7x in Q4 due to pandemic-related disruptions [43] Business Line Data and Key Metrics Changes - Residential same-store NOI increased by 9.8% in Q1 2020, driven by a 6% increase in revenues [17][30] - Office cash same-store NOI increased by 13.1% in Q1 2020, benefiting from major lease agreements [29] - The hotel segment, which contributed 4% of revenues, was significantly impacted, with an estimated EBITDA loss of $687,000 in Q1 [35] Market Data and Key Metrics Changes - Residential collections exceeded 96% for April 2020, with a retention rate of 63% for tenants seeking extensions [18] - The company has a strong credit portfolio with delinquencies less than 5% in the office segment [12] - The parking operations produced $21.4 million in revenue in 2019, with expectations for a similar amount in 2020 despite disruptions [36] Company Strategy and Development Direction - The company is focusing on longer-term residential leases and reducing corporate tenancy in response to market changes [20] - Development projects are ongoing, with $31 million remaining in capital obligations to complete the current portfolio [44] - The company is actively marketing suburban office portfolios while managing a light rollover in Waterfront properties [45] Management's Comments on Operating Environment and Future Outlook - Management noted that the hotel segment remains a significant concern, with uncertain recovery timelines [54] - The company is adapting to the changing environment by implementing virtual tours and focusing on tenant needs [52] - Management expressed confidence in the resilience of the multifamily asset class and the potential for recovery in parking and retail segments [54] Other Important Information - The company has contributed $2 million to local small business funds and provided support to medical personnel during the pandemic [7] - The company is in various stages of LOI and contract negotiations for 784,000 square feet of assets, with expected closings in late Q3 to Q4 [41] Q&A Session Summary Question: How are conversations with buyers going amid the pandemic? - Management noted that buyers are looking to lock in stable cash flows and advantageous financing, with ongoing discussions about pricing and timelines [60] Question: Will suburban demand increase due to deurbanization trends? - Management indicated that they will proceed with planned sales of suburban assets, while acknowledging potential shifts in demand [62] Question: What trends are being observed in apartment move-ins and renewals? - Management reported an increase in tenant retention rates and a shift towards longer lease extensions as tenants reconsider moving [74] Question: What renewal increases are being offered to tenants? - Management stated that renewal increases vary, with some tenants receiving modest increases while others may see no increase due to current economic conditions [76]

Citi 2020 Global Property CEO Conference March 2020 This Operating and Financial Data should be read in connection with our Annual Report on Form 10-K for the year ended December 31, 2019. Statements made in this presentation may be forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements can be identified by the use of words such as "may," "will," "plan," "potential," "projected," "should," "expect," "anticipate," "estimate, ...

Mack-Cali Realty Corporation (CLI) Q4 2019 Earnings Conference Call February 27, 2020 8:00 AM ET Company Participants Michael DeMarco - CEO Nicholas Hilton - EVP, Leasing Marshall Tycher - Chairman, Roseland Residential Trust David Smetana - Chief Financial Officer Conference Call Participants Derek Johnston - Deutsche Bank North America James Feldman - Bank of America Merrill Lynch Emmanuel Korchman - Citigroup John Guinee - Stifel, Nicolaus & Company, Inc. Daniel Ismail - Green Street Advisors Steve Sakwa ...

Company Performance Highlights - Achieved Core FFO of $44.1 million, or $0.44 per share in 4Q 2019[18, 21] - Produced AFFO of $26.2 million in 4Q 2019[18, 21] - Office portfolio finished 4Q at 80.7% leased (excluding Non-Core)[18, 21] - Residential operating portfolio finished 4Q at 95.0% leased[18, 21] Transaction Activities in 4Q 2019 - Disposed of 3600 Route 66 for a gross price of $26.1 million[22] - Disposed of Alterra & The Chase at Overlook Ridge for a gross price of $411.5 million[22] - Closed a $300.0 million construction loan on The Charlotte[22] - Disposed of 5 Wood Hollow Road for a gross price of $29.3 million[22] Net Asset Value (NAV) - Total Mack-Cali NAV was $3.425 billion, or approximately $34.16 per share[27] - Office portfolio NAV range was between $2.042 billion and $2.608 billion[27] - Residential portfolio NAV range was between $2.043 billion and $2.450 billion[27] Debt Profile - Total consolidated debt, net was $2.808518 billion[24, 87] - Weighted average interest rate on total debt was 3.81%[87] - Fixed rate debt accounted for 81.75% of the total debt[87]

PART I [Business](index=5&type=section&id=Item%201.%20Business) Mack-Cali Realty Corporation is a REIT focused on Class A office and multi-family properties, strategically divesting suburban office assets to concentrate on waterfront and luxury multi-family portfolios - The Company is a fully-integrated, self-administered REIT focused on **Class A office and multi-family rental properties** primarily in the **Northeast**[17](index=17&type=chunk)[19](index=19&type=chunk) Portfolio Overview as of December 31, 2019 | Property Type | Count | Size/Units | | :--- | :--- | :--- | | Office Properties | 42 | ~10.7 million sq. ft. | | Multi-family Rental Properties | 21 | 6,524 residential units | | Parking/Retail Properties | 4 | ~108,000 sq. ft. | | Hotels | 3 | 723 rooms | - A key strategic decision was made in December 2019 to **sell the entire suburban New Jersey office portfolio**, totaling approximately **6.6 million sq. ft** The results of this portfolio are now classified as discontinued operations[24](index=24&type=chunk) - The company plans to use proceeds from the suburban office portfolio sale to **pay down corporate-level, unsecured indebtedness**, shifting its focus to **waterfront class A office and multi-family rental portfolios**[27](index=27&type=chunk) 2019 Transaction Summary | Transaction Type | Value/Proceeds ($) | Details | | :--- | :--- | :--- | | Acquisitions | ~$804.1 million | Acquired one office property, two multi-family properties, and three land parcels | | Dispositions | ~$1.1 billion (net proceeds) | Sold 64 office properties, four multi-family properties, and four land parcels, realizing net gains of ~$390 million | - The company is actively developing **four major multi-family projects** in New Jersey and Massachusetts, with total estimated costs exceeding **$800 million** and expected completion dates between 2020 and 2022[57](index=57&type=chunk)[59](index=59&type=chunk)[60](index=60&type=chunk) [Risk Factors](index=12&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks from adverse economic conditions, real estate industry challenges, and financial risks related to debt and REIT qualification, exacerbated by its strategic repositioning - The company's business is highly susceptible to **adverse economic conditions**, particularly in the **Northeast**, which could negatively impact rental rates, property values, and access to capital[73](index=73&type=chunk) - A significant portion of revenue is derived from tenants in the **financial, credit, and insurance industries (24.9%, 12.3%, and 11.5% respectively)**, making the company vulnerable to downturns in these sectors[82](index=82&type=chunk) - The **strategic shift to multi-family rental properties** introduces new risks, including **shorter-term leases, increased competition** from other housing sources, and dependency on financing from entities like Fannie Mae or Freddie Mac[88](index=88&type=chunk)[89](index=89&type=chunk) - The company is subject to risks associated with its **debt financing**, including **restrictive financial covenants** in its credit facilities and indentures As of December 31, 2019, total outstanding indebtedness was **$2.8 billion**[101](index=101&type=chunk)[104](index=104&type=chunk) - **Failure to maintain REIT qualification** under the IRS Code would subject the company to **federal income tax at regular corporate rates**, significantly impacting financial results and the ability to pay dividends[124](index=124&type=chunk)[128](index=128&type=chunk) [Unresolved Staff Comments](index=22&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the Securities and Exchange Commission - None[135](index=135&type=chunk) [Properties](index=23&type=section&id=Item%202.%20Properties) As of December 31, 2019, the company's portfolio included 43 commercial properties (10.5 million sq. ft.) and 14 multi-family properties, with commercial properties 80.7% leased and a concentration in New Jersey and financial sector tenants Consolidated Property Portfolio Summary (as of Dec 31, 2019) | Property Type | Count | Size / Units | | :--- | :--- | :--- | | Commercial Properties | 43 | ~10.5 million sq. ft. | | Multi-Family Properties | 14 | 3,913 units | | Hotels | 2 | 372 rooms | - The percentage of leased commercial square feet in stabilized operating consolidated properties has **declined** over the past five years, from **86.2%** at year-end 2015 to **80.7%** at year-end 2019[143](index=143&type=chunk) Top 5 Commercial Tenants by Annualized Base Rent (Consolidated Properties) | Tenant | Annualized Base Rental Revenue ($) | % of Total | | :--- | :--- | :--- | | Merrill Lynch Pierce Fenner | 10,898,022 | 4.0% | | John Wiley & Sons, Inc. | 10,888,237 | 4.0% | | MUFG Bank Ltd. | 10,189,469 | 3.8% | | Dun & Bradstreet Corporation | 7,516,240 | 2.8% | | Daiichi Sankyo, Inc. | 6,909,661 | 2.6% | Lease Expiration Schedule (Consolidated Commercial Properties) | Year of Expiration | Net Rentable Area (Sq. Ft.) | % of Total Leased Sq. Ft. | | :--- | :--- | :--- | | 2020 | 470,324 | 5.8% | | 2021 | 798,400 | 9.8% | | 2022 | 618,005 | 7.6% | | 2023 | 1,467,018 | 18.0% | | 2024 | 809,606 | 10.0% | - The tenant base is **heavily concentrated in the financial services sector**, with **Securities, Commodity Contracts & Other Financial (24.9%), Credit Intermediation (12.3%), and Insurance (11.5%)** representing the top three industries by annualized base rent[160](index=160&type=chunk) [Legal Proceedings](index=34&type=section&id=Item%203.%20Legal%20Proceedings) The company reports no material pending legal proceedings beyond routine litigation incidental to its business - There are **no material pending legal proceedings**, other than ordinary routine litigation incidental to the Company's business[168](index=168&type=chunk) [Mine Safety Disclosures](index=34&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[169](index=169&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=34&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on the NYSE under 'CLI', with its five-year cumulative total return underperforming both the S&P 500 and NAREIT Equity REIT Index - The General Partner's common stock is traded on the **NYSE** under the symbol "**CLI**"[171](index=171&type=chunk) 2019 Quarterly Common Stock Price Range ($) | Quarter | High | Low | Close | | :--- | :--- | :--- | :--- | | First | 22.55 | 18.74 | 22.20 | | Second | 24.88 | 21.68 | 23.29 | | Third | 24.09 | 19.97 | 21.66 | | Fourth | 23.40 | 19.96 | 23.13 | - The company's five-year cumulative total return performance graph shows its stock **underperforming both the S&P 500 Index and the NAREIT Equity REIT Index**[177](index=177&type=chunk)[178](index=178&type=chunk) [Selected Financial Data](index=36&type=section&id=Item%206.%20Selected%20Financial%20Data) The company presents five years of selected financial data, showing 2019 total revenues of $350.9 million, net income of $111.9 million, total assets of $5.3 billion, and total debt of $2.8 billion Selected Financial Data - General Partner (in thousands, except per share data) | Metric | 2019 | 2018 | 2017 | | :--- | :--- | :--- | :--- | | Total revenues | $350,935 | $365,714 | $459,030 | | Income from continuing operations | $252,554 | $80,267 | $10,840 | | Net income available to common shareholders | $111,861 | $84,111 | $23,185 | | Net income per share – diluted | $0.95 | $0.80 | $0.06 | | Dividends declared per common share | $0.80 | $0.80 | $0.75 | | Total assets | $5,292,798 | $5,060,644 | $4,957,885 | | Total debt | $2,808,518 | $2,792,651 | $2,809,568 | Selected Financial Data - Operating Partnership (in thousands, except per unit data) | Metric | 2019 | 2018 | 2017 | | :--- | :--- | :--- | :--- | | Total revenues | $350,935 | $365,714 | $459,030 | | Income from continuing operations | $252,554 | $80,267 | $10,840 | | Net income available to common unitholders | $125,125 | $93,638 | $25,896 | | Net income per unit – diluted | $0.95 | $0.80 | $0.06 | | Distributions declared per common unit | $0.80 | $0.80 | $0.75 | | Total assets | $5,292,798 | $5,060,644 | $4,957,885 | | Total debt | $2,808,518 | $2,792,651 | $2,809,568 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=37&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the strategic shift to waterfront and multi-family assets, noting decreased same-store revenue, increased net income from property dispositions, and a liquidity strategy relying on cash flow, sales, and credit facility for its $2.8 billion debt - The company's strategic shift involves **selling its entire suburban New Jersey office portfolio (6.6 million sq. ft.)** to focus on **waterfront office and multi-family properties**, with proceeds intended to **reduce unsecured debt**[192](index=192&type=chunk)[195](index=195&type=chunk) - Same-store revenue from leases **decreased by $6.3 million (2.0%)** in 2019 compared to 2018, primarily due to a **610 basis point drop** in average office portfolio occupancy from **82.2% to 76.1%**[258](index=258&type=chunk) - General and administrative expenses **increased by $3.7 million (6.8%)** in 2019, driven by **$4.6 million** in strategic planning costs and **$4.1 million** related to the contested 2019 board election[265](index=265&type=chunk) - The company recognized a **net gain of $345.9 million** on the disposition of rental property in 2019, a **significant increase** from the **$99.4 million** gain in 2018[271](index=271&type=chunk) Debt Summary as of December 31, 2019 | Debt Type | Balance ($000s) | % of Total | Weighted Avg. Interest Rate | | :--- | :--- | :--- | :--- | | Fixed Rate Unsecured | 575,000 | 20.3% | 4.09% | | Fixed Rate Secured | 1,737,785 | 61.4% | 3.80% | | Variable Rate Secured | 187,252 | 6.6% | 4.02% | | Variable Rate Unsecured | 329,000 | 11.6% | 3.09% | | **Total** | **2,829,037** | **100.0%** | **3.81%** | - **Funds from Operations (FFO)** available to common stock and unitholders was **$116.1 million** in 2019, a **decrease from $170.4 million** in 2018, primarily due to lower gains and higher impairment charges recognized in FFO calculation[351](index=351&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=64&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk, with $2.3 billion of debt at fixed rates and a 100 basis point rate change impacting variable-rate debt by $5.1 million annually - The company's primary market risk exposure is to changes in **interest rates**[358](index=358&type=chunk) - As of December 31, 2019, approximately **$2.3 billion** of the company's long-term debt is at **fixed rates**, while approximately **$516 million** is at **variable rates**[360](index=360&type=chunk)[361](index=361&type=chunk) - A hypothetical **100 basis point (1%)** increase or decrease in interest rates would change annual interest costs on variable-rate debt by approximately **$5.1 million**[360](index=360&type=chunk) [Financial Statements and Supplementary Data](index=65&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section includes consolidated financial statements and PricewaterhouseCoopers LLP's unqualified audit opinion on financial statements and internal controls, highlighting critical audit matters related to real estate valuation - The independent auditor, PricewaterhouseCoopers LLP, issued an **unqualified opinion** on the consolidated financial statements and the **effectiveness of internal control over financial reporting** as of December 31, 2019[392](index=392&type=chunk)[412](index=412&type=chunk) - **Critical Audit Matters** identified by the auditor include the **estimation of net sales price for real estate held for sale** without an executed sales agreement, and the **valuation of the Roseland real estate portfolio** to determine the estimated future redemption value of a non-controlling interest[398](index=398&type=chunk)[403](index=403&type=chunk) Consolidated Balance Sheet Summary (in thousands) | Account | Dec 31, 2019 | Dec 31, 2018 | | :--- | :--- | :--- | | Net investment in rental property | $4,664,561 | $4,316,997 | | Total Assets | $5,292,798 | $5,060,644 | | Total Liabilities | $3,089,941 | $3,033,004 | | Total Equity | $1,699,475 | $1,697,181 | Consolidated Statement of Operations Summary (in thousands) | Account | 2019 | 2018 | 2017 | | :--- | :--- | :--- | :--- | | Total Revenues | $350,935 | $365,714 | $459,030 | | Income from continuing operations | $252,554 | $80,267 | $10,840 | | Net Income | $143,836 | $106,401 | $33,718 | | Net income available to common shareholders | $111,861 | $84,111 | $23,185 | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=65&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None[364](index=364&type=chunk) [Controls and Procedures](index=65&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2019, with no material changes reported - The CEO and CFO concluded that the disclosure controls and procedures for both the General Partner and the Operating Partnership were **effective** as of December 31, 2019[365](index=365&type=chunk)[371](index=371&type=chunk) - Management concluded that internal control over financial reporting was **effective** as of December 31, 2019, based on the COSO framework This assessment was **audited by PricewaterhouseCoopers LLP**[367](index=367&type=chunk)[369](index=369&type=chunk)[373](index=373&type=chunk) - There were **no changes in internal control over financial reporting** during the fourth quarter of 2019 that materially affected, or are reasonably likely to materially affect, the company's internal controls[370](index=370&type=chunk)[377](index=377&type=chunk) [Other Information](index=67&type=section&id=Item%209B.%20Other%20Information) This item is not applicable - Not Applicable[378](index=378&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=67&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information regarding directors, executive officers, and corporate governance is incorporated by reference from the 2020 proxy statement - Information is **incorporated by reference** from the definitive proxy statement for the annual meeting of shareholders expected to be held on June 10, 2020[380](index=380&type=chunk) [Executive Compensation](index=67&type=section&id=Item%2011.%20Executive%20Compensation) Information regarding executive compensation is incorporated by reference from the 2020 proxy statement - Information is **incorporated by reference** from the definitive proxy statement for the annual meeting of shareholders expected to be held on June 10, 2020[381](index=381&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=67&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information regarding security ownership and related stockholder matters is incorporated by reference from the 2020 proxy statement - Information is **incorporated by reference** from the definitive proxy statement for the annual meeting of shareholders expected to be held on June 10, 2020[382](index=382&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=67&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information regarding related party transactions and director independence is incorporated by reference from the 2020 proxy statement - Information is **incorporated by reference** from the definitive proxy statement for the annual meeting of shareholders expected to be held on June 10, 2020[383](index=383&type=chunk) [Principal Accounting Fees and Services](index=67&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Information regarding principal accounting fees and services is incorporated by reference from the 2020 proxy statement - Information is **incorporated by reference** from the definitive proxy statement for the annual meeting of shareholders expected to be held on June 10, 2020[384](index=384&type=chunk) PART IV [Exhibits and Financial Statement Schedules](index=68&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists all financial statements, schedules, and exhibits filed as part of the Form 10-K, including key real estate and mortgage loan schedules, and an extensive exhibit index - This section includes **all financial statements**, the **Report of Independent Registered Public Accounting Firm**, and **financial statement schedules**[386](index=386&type=chunk) - Key financial statement schedules provided are **Schedule III – Real Estate Investments and Accumulated Depreciation**, and **Schedule IV – Mortgage Loans on Real Estate**[387](index=387&type=chunk) - An **extensive list of exhibits** is provided, including corporate charters, bylaws, debt indentures, material contracts, employment agreements, and Sarbanes-Oxley certifications[388](index=388&type=chunk)[764](index=764&type=chunk) [Form 10-K Summary](index=68&type=section&id=Item%2016.%20Form%2010-K%20Summary) This item is not applicable - Not Applicable[389](index=389&type=chunk)

Mack-Cali NAREIT Presentation November 2019 This Operating and Financial Data should be read in connection with our Quarterly Report on Form 10-Q for the quarter ended September 30, 2019. Statements made in this presentation may be forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements can be identified by the use of words such as "may," "will," "plan," "potential," "projected," "should," "expect," "anticipate," "estimate," ...

Mack-Cali Realty Corporation (CLI) Q3 2019 Earnings Conference Call October 31, 2019 8:00 AM ET Company Participants Michael DeMarco - Chief Executive Officer Nicholas Hilton - Executive Vice President, Leasing Marshall Tycher - Chairman, Roseland Residential Trust David Smetana - Chief Financial Officer Conference Call Participants Derek Johnston - Deutsche Bank North America James Feldman - Bank of America Merrill Lynch Michael Bilerman - Citigroup Emmanuel Korchman - Citigroup John Guinee - Stifel, Nicol ...