Griffin Capital REIT Buys Mack-Cali Parsippany Class A

PARSIPPANY, NJ—A non-traded REIT sponsored by California-based Griffin Capital Corporation has acquired Mack-Cali Realty Corporation's 14 Sylvan Way, a 203,506-square-foot, class A trophy office building in Parsippany, NJ, for $81.4 million.

"This was an excellent opportunity to monetize the value of this class A corporate headquarters,” says Mitchell E. Rudin, chief executive officer of Mack-Cali. “The proceeds will be reinvested into more strategic growth opportunities."

Holliday Fenoglio Fowler represented Mack-Cali in the sale.  In addition to the sales price, Griffin Capital Essential Asset REIT II is assuming responsibility for $2 million in additional tenant improvement allowance obligations, Mack-Cali says. 

14 Sylvan Way was completed in 2013 as a build-to-suit for the corporate headquarters of Wyndham Worldwide Operations, a subsidiary of Wyndham Worldwide Corporation, which leases the entire facility.  The three-story property has received LEED Gold designation in commercial interiors.  Griffin says Wyndham has a remaining lease term of more than 14 years with annual base rental rate increases of 1.75% and no termination or contraction options.

"Given the tenant's 20+ year history in the Mack-Cali Business Campus, the recent construction of the property and the tenant's capital investment into the property, we believe Wyndham will continue to find the property attractive as its headquarters for the foreseeable future," says Robert Corry, Griffin Capital's managing director of acquisitions.

The common areas were designed to match those of a five-star Wyndham resort and tenants have access to amenities including a cafe, training center, employee lounge and a resort-style courtyard.  14 Sylvan Way is situated on a 23.15-acre site within the Mack-Cali Business Campus adjacent to 22 Sylvan Way, which is the second half of the tenant's headquarters campus purchased by another non-traded REIT sponsored by Griffin Capital in 2014.  This location provides easy access to Interstate 287 and Route 10 in northern New Jersey.

The HFF investment sales team representing Mack-Cali was led by senior managing director José Cruz, managing director Kevin O'Hearn, senior analyst Marc Duval and supported by senior managing director Andrew Scandalios and associate director Stephen Simonelli.

“The property is an absolute class A and was highly sought after in a competitive process,” says Cruz. “With GCEAR II buying the building, Griffin Capital-sponsored REITs now own two of the best buildings in Parsippany - 22 and 14 Sylvan.”