The Cranford, NJ-based REIT has quickly bounced back with a vengeance in the form of its plan to build two class A office towers at its Harborside Financial Center on the Hudson River waterfront. The buildings include a 33-story, 915,000-sf tower, Harborside Plaza 5, which already has "tenant commitments for 25% of the space," according to Mitchell Hersh, Mack-Cali CEO. The other tower is the 19-story, 575,000-sf Plaza 10, and discount brokerage Charles Schwab has already inked a deal to lease 300,000 sf of the building, according to Hersh. Schwab will move into the new space in the first half of 2002.

The two buildings will cost Mack-Cali about $400 million, but with about 35% of the 1.5 million sf already gone before ground-breaking, the project appears to be worth the price of admission. Indeed, the market picture could be the big story. When the two towers are done, Harborside alone will amount to 3.6 million sf of class A space. The site can to handle as much as 4.5 million of additional office space.

Altogether, the Jersey City waterfront, not including the latest announced projects, totals 11.7 million sf of office space, most of which didn't exist a decade ago. According to Insignia/ESG, who leases Mack-Cali's waterfront projects, the vacancy rate in the submarket is a scant 0.2%, and it has absorbed more than 4.5 million feet in the last 18 months. By any yardstick, that adds up to arguably the strongest office submarket in the country.

Other recent Mack-Cali projects here include a 185,000-sf build-out for TD Waterhouse, a joint venture with Hyatt Hotels for a 350-room Hyatt Regency and 300 luxury condos in a joint venture with Lincoln Property Co.