Can Capital Redeployment Drive Mack-Cali's (CLI) Growth?
Zacks Investment Research | Dec 26, 2019 07:25AM ET
Mack-Cali Realty Corporation (NYSE:CLI) has been redeploying non-core asset sale proceeds into office and multi-family properties acquisitions as well as debt reduction. Such capital recycling efforts are encouraging. However, the dilutive impact on earnings from such huge asset sales cannot be bypassed in the near term.
Recently, the company’s board of directors decided to dispose its entire 6.6 million square-foot suburban office portfolio. It plans to complete the sale of this entire portfolio in 2020, after which, the company’s entire holdings will consist of its waterfront Class-A office portfolio, spanning 5 million square feet of space and the multi-family residential real estate operations through its subsidiary Roseland Residential Trust. Moreover, Mack-Cali intends to use asset sales proceeds to repay outstanding corporate-level, unsecured debt. This will strengthen the company’s balance sheet. (Read more: Zacks Investment Research
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