Mack-Cali Realty Corporation (CLI) a real estate investment trust recently signed a 21-year lease with General Reinsurance Corporation at 125 Broad Street in Downtown Manhattan totaling 56,106 square feet.

General Reinsurance is one of the biggest reinsurers in the US operating more than 45 offices in 26 countries. This lease shows Mack-Cali’s interest to expand its presence in Manhattan. With the continued strong leasing activities, Mack-Cali anticipates a gradual recovery of the overall capital market and the housing sector in general. The Class A property of 125 Broad street is one the best properties with excellent location and facilities.

Mack-Cali is one of the largest office REITs in the U.S. with approximately 2,000 tenants from diverse industries. Furthermore, the company has a strong presence in high barrier-to-entry markets in the Northeast and Mid-Atlantic regions. This provides a strong upside potential for the company.

During the first quarter 2011 Mack-Cali reported FFO (fund from operations) of $67.3 million or 70 cents per share, compared to $66.5 million or 72 cents per share in the year-earlier quarter. Fund from operations, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income. FFO for the quarter was in line with the Zacks Consensus Estimate.

Mack-Cali is primarily engaged in leasing, managing and developing Class A office and industrial/flex properties.  At current levels, Mack-Cali owns or has interests in 277 office and flex properties located in the Northeast, spanning approximately 32.2 million square feet.

Mack- Cali currently retains a Zacks #4 Rank, which translates into a short-term Sell rating. We are also maintaining our long-term Neutral recommendation on the stock. One of its competitors, Boston Properties Inc. (BXP) currently retains a Zacks #3 Rank, which translates into a short-term Hold rating.

 
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