A spokesman for the Florham Park-based Gale Co. declined to comment on or confirm the pending deal. A spokesman for the locally based Mack-Cali acknowledges that the firm is aware of market rumors, adding that the company would not comment on such reports.
The portfolio, consisting of 36 buildings totaling 4.7 million sf of office space, mostly in Northern and Central New Jersey, was acquired by Gale and SL Green in mid-2004 from Morgan Stanley Real Estate Funds and UBS. The holdings constituted most of the former Bellemead Development Corp. portfolio, which parent Chubb had sold off earlier.
As reported by GlobeSt.com last November, Gale and SL Green had hired New York City-based Eastdil Realty "to explore various alternatives" for recapitalizing the holdings. "The venture partners' objective is to realize the value created in the portfolio through the signing of more than 1.5 million sf of leases over the past 18 months," according to a prepared statement issued by the two firms at the time.
According to reports, a total of eight firms or partnerships entered the bidding for the properties, with Mack-Cali emerging as the frontrunner. The formal announcement is expected to come this week, although spokesmen for both Gale and Mack-Cali would not confirm the details.
It's also not clear how much of the Bellemead portfolio is involved in the transaction. The reported $550-million sale price matches what Gale and SL Green paid for the entire portfolio less than two years ago, but industry sources say the holdings might be worth as much as $200 million more than that today.
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