The Cranford-based REIT's involvement in the 460,000-sf complex dates back to late 2003 when it provided a $16.3-million mezz loan secured by the buildings to One River Associates, a partnership headed by local builders William Schaffel and Ben Torcivia, Jr. The complex was originally built for Bellcore, which vacated it in 2002 as part of the telecom industry's wider cutbacks.

The mezz loan, which carried an 11% interest rate and a pay rate of 250 basis points over Libor, was part of the effort to reposition One River as a multi-tenant complex. As part of the transaction, Mack-Cali was hired as property manager and leasing agent. This past fall, Mack-Cali exercised an equity conversion option to acquire a 62.5% interest in the complex. The loan balance at the time was $13 million.

"The transaction allowed us to participate in this property with minimal risk during its lease-up, and to convert our loan position into an equity interest as the property became more stabilized," says Mitchell E. Hersh, president and CEO of Mack-Cali. "We were able to capitalize on an opportunity and create value for our shareholders."

Since the REIT got involved with the former Bellcore complex, its occupancy has been boosted from a little over 50% leased to its current 90%. As reported by GlobeSt.com, new tenants signed in that period have included High Point Safety and Insurance Management Corp., the former property and casualty business of Prudential Financial, which took 88,000 sf for 11 years this past spring; Jersey Central Power & Light and its parent company, FirstEnergy, which took a combined 82,500 sf; Maser Consulting, which grabbed up 30,000 sf; and Withum Smith & Brown, which took 22,500 sf.

One River Centre consists of two four-story, 120,000-sf buildings and one three-story, 220,000-sf building on a 35.2-acre site near Exit 109 of the Garden State Parkway in Monmouth County.

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Mack-Cali Acquires the Rest of One River Centre

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