January 5, 2022
Commercial Observer

MAG Partners Rings in 2022 With New Hires, Including Rob Willis From Mack-Cali

MaryAnne Gilmartin’s MAG Partners rang in 2022 with the addition of construction industry veteran Rob Willis, Commercial Observer can first report. 

The hiring serves as a reunion for the two commercial real estate executives. Willis was most recently senior vice president of construction at Veris Residential (formerly Mack-Cali Realty Corporation), and first became acquainted with Gilmartin while working alongside her at Forest City Ratner Companies 19 years ago. The two also intersected briefly at Mack-Cali. 

Gilmartin tapped Willis for the head of construction role at MAG as the developer gears up to tackle large-scale multifamily and office properties throughout Manhattan.

“When MaryAnne gave me the call I thought about it for about one second,” said Willis, who was vice president at Forest City Ratner from 1998 to 2004 and became senior vice president of construction at Mack-Cali in September 2020. “I admire her so much as she is so talented and has so much experience, and the rest of the team is really good at what they do.”

Gilmartin rose through the ranks at Forest City Ratner Companies to become president and CEO, before forming L&L MAG in 2018 with L&L Holding Company’s David Levinson and Robert Lapidus. She founded MAG in July 2020 while simultaneously spending nine months as an interim CEO at Mack-Cali on the heels of a leadership shakeup at the real estate investment trust, where she had served on its board. 

During his time at Mack-Cali — which was rebranded as Veris Residential in late 2021 — Willis oversaw a construction department that was responsible for the $100 million repositioning of Harborside 1 in Jersey City, N.J., a 4.3 million-square-foot office campus. He previously led the design and construction team at HEI Hotels & Resorts and was managing director of the John Hardy Group’s New York City office.

At Forest City Ratner, Willis served as the day-to-day project manager on the 42nd Street Retail-Entertainment Complex and The New York Times building projects. After Forest City, he spent four years as vice president of design and construction at Starwood Hotels and Resorts, which included laying the groundwork for the building of the St. Regis Bal Harbour Resort in Miami Beach, Fla. 

“When we started the company we knew that we were going to have to grow and grow strategically and lean on the life cycle of a ground-up development company where the construction piece is back ended and it takes sometimes years to put buildings together,” Gilmartin said. “Now that we are several years in, we are building things and because of that we can get a great talent to help us deliver the construction part of our business.” 

A year and a half after completing the buyout of her L&L partners and launching MAG Partners, the firm is tackling four development projects in Manhattan including a 480-unit residential development at 241 West 28th Street slated for completion in late 2022. Another rental project with an affordable component that Willis will help spearhead is 335 Eighth Avenue, scheduled to break ground this spring, and a new boutique office development also slated to launch this year at 122 Varick Street. 

In addition to the hire of Willis, Gilmartin added Lizzy Zevallos as assistant vice president of development. Zevallos arrives at MAG after serving as vice president of portfolio management at Maverick Real Estate Partners, where she helped underwrite more than $3 billion of CRE loans. Zevallos, who is also a professional dancer and choreographer, also interned under Gilmartin at L&L MAG from January 2020 to June 2020. 

Gilmartin also hired Arion Alku as an accounting manager, bringing MAG’s staff up to 10. Alku previously worked as a senior accountant at Marx Realty, where he conducted audits and internal controls for some of the largest real estate owners in the New York City metropolitan area. 

MAG’s expanded 10-person team now consists of six women and four men. Boosting diversity has been a core focus of Gilmartin since launching MAG in addition to constructing projects that intersect well with their neighborhoods. 

“We’re building a different company where we’re creating a new model for development and we’re focusing on diversity,” Gilmartin said. “We want to bring the community into our process and do that while delivering the highest-quality buildings.” 



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November 24, 2021
Crain's New York Business

30. MaryAnne Gilmartin – CEO, MAG Partners

2017 RANK: 11

CORPORATE ASSETS Worth $800 million

IMPACT Gilmartin is chairwoman emeritus of the Downtown Brooklyn Partnership, an executive committee member of BAM, a board member of New York Public Radio and an executive committee and board member of the Real Estate Board of New York.

ONCE, TWICE, four times a CEO.

At 56, MaryAnne Gilmartin has already been at the helm of four high-profile development firms in the city. She bought out her partners at L+L MAG to start MAG Partners in 2019. The company now controls a pipeline of three residential ground-up developments, as well as one commercial, in New York City.

While working on the new company, she was tapped to serve as the interim chief executive of New Jersey–based real estate investment trust Mack-Cali after investment group Bow Street partners ousted its previous leader, Michael DeMarco. Gilmartin has since relinquished the role and is back at her firm.

When she served as chief executive of Forest City Ratner Cos., she was a driving force behind some of the city’s most important developments including the Barclays Center and Pacific Park, which transformed Brooklyn, as well as the New York Times Building.



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May 18, 2021
Commercial Observer

#50 MaryAnne Gilmartin

MaryAnne Gilmartin gives new meaning to the term “multitasking.”

In the space of nine months, the seasoned real estate developer entered and exited as Mack-Cali Realty Corporation’s interim CEO; launched her own firm, MAG Partners; got a development deal in Chelsea off the ground; and formed a strategic partnership targeting $3 billion in future deals.

Gilmartin earned her stripes at Forest City Ratner, climbing the ranks to CEO, a position she held for four years, and then formed L&L MAG with David Levinson and Robert Lapidus in 2018.

In July of last year, after a shakeup at Mack-Cali during which the CEO resigned, Gilmartin, who was on the board, took over as interim CEO. Gilmartin was confident she could turn things around at the company before handing it off.

“It’s not what I wanted to do when I grew up,” Gilmartin joked. “It’s not what I saw myself doing because of my partners, and my team, and [MAG Partners] being my first love.”

During her time as CEO, in her words, Gilmartin “upskilled the talent,” “pruned the organization,” and “revamped the leasing strategy” on Mack-Cali’s massive Jersey City waterfront project, bringing in a new leading head, and Mary Ann Tighe to consult on the project.

But lest we forget about MAG Partners, Gilmartin completed the buyout of her L&L partners in 2020, and made moves on her first standalone deal: a 479-unit multifamily development in West Chelsea, a site acquired and planned during the L&L days.

Gilmartin was actually close to closing on a construction loan for the site in early 2020, but the lender pulled back once COVID hit. Gilmartin decided to push ahead and find other sources of capital. She brought in foreign investors Atalaya Capital Management, Safanad and Qualitas as partners, and closed on a $173 construction loan in October. “It was pretty binary,” she said. “It was like, do you believe in New York City?”

That being said, Gilmartin is beginning to look to other cities where she can replicate some of her previous work in “placemaking” projects — large, mixed-use, urban development — such as Barclays Center and MetroTech in Brooklyn. “We like to say we’re placemakers, not developers,” Gilmartin said.—C.G.



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May 17, 2021
Commercial Observer

The Biggest Jumps of Power 100

MaryAnne Gilmartin is no stranger to Power 100. Not too long ago, she had been running Forest City Ratner Companies as CEO and president, where she developed The New York Times Building, the Frank Gehry-designed Spruce Street apartment tower, and Barclays Center, among other city gems. She left to start a development company with Rob Lapidus and David Levinson, and then decided that she could get all the funding that she needed on her own, so she bought out her partners.

Hence, MAG Partners.

It could have been very, very unfortunately timed, but Gilmartin wowed. Yes, at the beginning of 2020, one of her construction lenders pulled back from a loan, but she deftly managed to secure foreign investors. At the same time, Mack-Cali, where she was on the board, asked her to take over as interim CEO after the real estate investment trust pushed out the full-time one. 

She trimmed the REIT’s fat, revamped its leasing strategy, and brought in new people, restoring confidence at the New Jersey-based company.

That’s the kind of year that’s worth a major jump in the ranks, so Gilmartin slid up 22 spaces — our second-biggest jump of 2021. (The biggest was the leaders of Taconic, who went from 54 to 25, thanks to huge investments in life sciences.)

Unlike in previous years, there were very few shakeups. A lot of the Power 100s moved up or down a little (and a significant number were left off the list entirely).

As we do every year, a lot of attention is devoted to the smaller, but significant shifts.

JLL’s Peter Riguardi has always been one of the very best brokers in the city. … And we always felt that his ranking (last year, he was 22) indicated that. But, given the hustle and the 2.5 million square feet he leased during the pandemic, not to mention his work with clients in finding real estate around the country, it was worth moving him into the teens.

Tommy Craig was likewise a very respectable number 26 last year. But given that Hines, the New York-area operations of which Craig leads, had invested in One Vanderbilt and One Madison, was building luxury senior housing on the Upper East Side, and had taken on 5.5 million square feet of Ivanhoé Cambridge’s portfolio — which is not even mentioning their work in the Hudson Valley, and industrial development in Pennsylvania, and Hudson Square and … well, you get the idea. Craig broke into the top 10.

Last year, Rob Speyer was a highly respectable number 12. But given Tishman Speyer’s sudden hunger for SPACs (call it a “SPAC attack”?) and how much of the real estate world seems to be following suit, we felt that he should go even higher. How does number five feel, Mr. Speyer?



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December 9, 2020
ROI-NJ

How Mack-Cali CEO is making health, wellness into top amenity in its properties

Gilmartin: ‘There isn’t anything better you could give your employees than the comfort of knowing that they’re healthy and well, and doing it at no cost to them’

MaryAnne Gilmartin was named interim CEO at Mack-Cali Realty Corp. at the end of July — or, when New Jersey was between surges of the COVID-19 pandemic.

And, while Gilmartin says she has no desire to lose the interim tag (see story here), she has quickly jumped into the role — and has the company moving forward with a number of health and wellness initiatives in its buildings, including Harborside in Jersey City, perhaps the REIT’s biggest point of emphasis as it doubles down on urban office and multifamily.

Sure, there’s the extra cleaning that all landlords are doing. But Gilmartin is looking to offer that deep cleaning to tenants, to have wellness companies as key tenants in mixed-use buildings (perhaps at a discount) and to have facilities that could give COVID tests (and perform other health care needs, such as physicals) on site.

“There isn’t anything better you could give your employees then the comfort of knowing that they’re healthy and well, and doing it at no cost to them,” she said.

Gilmartin spoke earlier this week on a CBRE lunch-and-learn hosted by Vice Chairman Jeffrey Dunne and Executive Vice President Jeremy Neuer. It was moderated by Mary Ann Tighe, CBRE’s CEO for the tri-state area.

Here’s a look at some of her thoughts on health and wellness in Mack-Cali buildings. Her answers are condensed for clarity and space:

On offering (extra) cleaning services

We obviously have been hyperfocused on cleanliness and sanitary measures inside of our office and residential buildings. But what Ed (Guiltanan, senior vice president of leasing) and I have realized is that the tenants are looking for protocols and they’re looking to understand best practices.

So, we’re putting together manuals for our residential portfolio and our commercial portfolio so people can understand exactly what that means. We’re also thinking of leveraging the fact that, if we’re cleaning our lobbies, elevators, common bathrooms, we should be offering the same upgraded services to the tenants themselves, because a lot of our tenants are now having to clean their own spaces above and beyond conditions and specs previously seen. We, as a landlord, should be offering that.

It might be important to offer that to the commercial users inside of our buildings. I think we’re going to want to provide an offering that’s going to be both delivering services that maybe we didn’t offer the tenants (previously), and then a wellness program.

On bringing testing to properties

Right now, during the pandemic, we’ve been bringing testing on-site. You can have COVID testing right in our offices, because we have a partnership with Hackensack Meridian (Health). It’s enormously convenient for people to know that the doctor will come to your office space.

We’re going to make that available to our customer base. I think that’s something we’re going to continue to do in the future. If testing is a fixture of the near-term, workplace environment, we’re going to make sure we deliver on that amenity.

On wellness as an amenity

People want a higher level of service. They want wellness, they want both private and public outdoor space that’s attractive and allows them to work in ways that are much more flexible than just sitting behind a computer all day.

We want to make sure that we have ambulatory care and clinic facilities right there within the Harborside campus so that you can go to the doctor and get your annual checkup without going back to Manhattan and seeing your doctor. Day care, fitness and food is what makes us tick. And, if you can have all of that at your fingertips, I think you’ve got something really special.

On attracting wellness companies

Because we control the environment, if I think we’re not going to drive rents in the retail because it’s much more important that we drive the rents upstairs, I can offer food and beverage operators, fitness companies, day care centers unbelievable value in the real estate — knowing that I’m not looking for the highest rent, I’m looking for those that are the best providers, and then I’ll get paid back on that investment on my commercial space upstairs, if that makes sense.

On capacity, property tech in residential

The tracking is pretty simple through turnstiles. We’re not doing anything more sophisticated than that, but we’re besieged by proptech companies that are coming in and showing us all the gizmos. And a lot of them are really priced competitively, so it’s a no-brainer to do some of this stuff.

On the (residential) side, to do touchless experiences from the moment you walk in the building to your apartment is easy to do. So, I think that’s the way of the future. Why are you touching things if you don’t need to, if it can be done through a mobile app? I think a lot of it in the homes and for residents is going to happen really quickly.

On capacity, property tech in commercial, office

I don’t think that the densities are really a big issue at Harborside, because the space has been industrial space in nature — lots of light, lots of air. We have really nice proportions in terms of the amount of dedicated space per employee.

We don’t have a lot to undo, relative to what’s happened in Manhattan. I think a feature of the future is that space will be much more generous. The days of packing (people) in like sardines? I think those days are behind us. I feel really confident that Mack-Cali doesn’t have a major new term in that in that respect, because the spaces are not overly dense to begin with.



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December 7, 2020
ROI-NJ

Gilmartin confirms ‘interim’ CEO tag, says there will be new day-to-day leadership at Mack-Cali in 2021

Mack-Cali Realty Corp. interim CEO MaryAnne Gilmartin talked about the past, present and future of the real estate investment trust Monday during a webinar. And, while she said she will continue to have a major role in the company, Gilmartin made it clear that she does not intend to remove the “interim” tag from her title.

“I’m not 100% clear on the timeline, but in 2021 there will be new day-to-day leadership inside of Mack-Cali and I will go back to being chair of the board,” she said.

Gilmartin, who has stepped away from her job as founder and CEO of MAG Partners in New York City to run Mack-Cali, talked about where she saw the Jersey City-based REIT going during a lunch-and-learn webinar moderated by Mary Ann Tighe, CBRE’s CEO for the tri-state area. It was hosted by CBRE Vice Chairman Jeffrey Dunne and CBRE Executive Vice President Jeremy Neuer.

“My decision to serve as interim CEO was not something I anticipated doing,” Gilmartin said. “I was convinced of it when I was asked by the board to do it because it had a timeline associated with it.

“I knew that it was a bit of a rabbit hole and would require substantially all of my time, but that it wouldn’t be something like Hotel California — you can check in, but you can’t check out.”

Gilmartin said she remains committed to Mack-Cali — and that serving as interim CEO will allow her to do a better job as chair.

“My commitment to the company is solid,” she said. “I’m deeply loyal to the team. And I believe, as chair, I will be able to serve people and the shareholders effectively and mightily because I’ve been the interim CEO.

“The nice thing is, I’ve had the opportunity to do this. I will be able to stay with the story and see it out through its completion, and I also get to go home again to my team at MAG Partners, where we have a capital source, we’ve got a building on 28th Street that we’re coming out of the ground building in West Chelsea and we see lots of opportunity through the pandemic.”

Gilmartin said she sees similar opportunity at Mack-Cali.

“I guess the safest thing I can say is that changes are afoot and that we are not going to look the way we look today in three years, if we have anything to say about it,” she said.

And, while it’s no secret that the firm wants to sell off its suburban assets, Gilmartin said there will not be a fire sale — regardless of what public pressure the company may face to do so.

“Selling segments in the business or (joint venturing), or bringing in new capital, just for the sake of satisfying the rally call for change, is not wise,” she said. “You can’t run the company based on what the analysts are saying has to happen. You basically have to look at the company and say, ‘We definitely need to change it up a little bit.’

“Selling suburban is a strategy to make the balance sheet simpler and to produce proceeds so that we can shore up the balance sheet and increase liquidity and reduce debt — those things make a ton of sense. And I believe, all through 2021, we will sell a billion dollars of assets and that will make a meaningful difference on the company’s bottom line.”

That would make for a different company, too.

“You’re left with a residential business that is robust and has extraordinary value,” she said. “And we can keep doing that. We can supersize that portfolio and be a bigger, better version of ourselves. And/or we can be a commercial company that extracts the value that we know exists on the waterfront and we could JV with other commercial operators and owners and be a bigger, better version of ourselves as a commercial landlord. I think either of those two things are possible.

“Having two businesses — a residential business and a commercial business — is a really nice story of diversification, particularly if it’s mostly urban. So, I don’t see it impossible that the company is a commercial and residential landlord. But it has to have a healthier balance sheet, has to have better execution and it needs to have access to greater sources of capital.”

November 9, 2020
NJBiz

No. 9: MaryAnne Gilmartin; Commercial Real Estate Power 50

Gilmartin was appointed interim chief executive officer at Mack-Cali in July 2020 with the firm dealing with activist investor Bow Street Capital. The dissident investor had been trying to elect its own slate of directors to Mack-Cali’s board.

Since taking the helm, Gilmartin has made several strategic deals to help, one of the largest landlords in New Jersey, refocus on more valuable waterfront properties.

She has put together a new team to orchestrate a transformation at Harborside, its mixed-use office campus in Jersey City. The group of professionals, consisting of newly hired experts and internal leaders, will facilitate the repositioning, leasing and marketing of the 4.3 million-square-foot property along the Hudson River.

Gilmartin has become a champion for women in the industry and recently founded her own company, MAG Partners, which just announced plans for a new residential development in Manhattan.



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November 2, 2020
Commercial Observer

MaryAnne Gilmartin; Founder and interim CEO at MAG Partners and Mack-Cali Realty

How flexible are you with negotiating rents?
We are currently repositioning Mack-Cali’s Harborside campus in Jersey City, where we have great office space with million-dollar views available to companies looking to control their full environment post-COVID-19 [pandemic]. For those willing to come across the river, it is an amazing value proposition.

Has your “dead to me” list grown?
Yes.

Are you in the market for financing?
Yes.

What would be the signs that things are NOT going to improve in 2021?
I am watching what happens with schools very, very closely.

What do you think will NOT go back to normal?
Only eating indoors. The new outdoor perches for dining in New York City are amazing — thankfully, that silver lining that is here to stay.

I also think residential builders and operators will capitalize on the [work-from-home] phenomenon and innovate with more outdoor spaces and working-from-home services.

Who do you like for mayor in 2021?
That’s a tough one. I am still waiting for a true civic hero to step up. In the decency and humanity front, I do want to commend Corey Johnson for being so human and honest, something we don’t see enough in politics.

What do you think the city and/or state should do to help both real estate and the city?

The mayor needs to start speaking up and stepping up for long-term growth and development for our city. While budgets are tight today, we need to continue to work to increase the competitiveness of New York City with strategic thinking and planning.

How do you think the November election will affect real estate? How do you see a Trump win? How do you see a Biden win?
A Trump win would be another blow to great American cities — and the New York region is atop that list. Biden’s road will be long and hard, but it will recognize the importance a prosperous tri-state area holds for the country and the world.

 
LIGHTNING ROUND
Where’s your apocalypse bunker? 

My rooftop in Park Slope.

Did you gain or lose weight during quarantine? 

Held steady with a lot more effort!

Sourdough bread, banana bread, other? 

Sourdough

Which TV show have you binged? 

News-binging got in my way.

What restaurant did you go to when restaurants reopened? 

North Fork Table

Where did you quarantine? 

North Fork with my kids.

Biden, Trump or Kanye? 

Biden



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October 29, 2020
New York Business Journal

Women of Influence honoree: MaryAnne Gilmartin, MAG Partners LP and Mack-Cali Realty Corp.

Editor’s note: This profile is one of 10 spotlights we’re publishing this week featuring this year’s New York Business Journal Women of Influence honorees. We asked each of the 10 to complete a survey form through which we can share with you some of their background, their achievements and their industry insights. You can see all of the profiles that have been published to date, along with related coverage, here.

Name: MaryAnne Gilmartin

Companies: MAG Partners LP / Mack-Cali Realty Corp.

Titles: Founder and CEO / Interim CEO

Where born: Queens, New York

Education: Fordham University (B.A.S., Master’s)

In my job, I’m responsible for: The people, places and things that drive value. I have a deep affinity for the built environment and think of our role in the metro area as civic developer, owner and operator. Above everything, it takes great people to do great things, so my primary duty is to act tirelessly as chief talent officer. As a project manager by training, I work hard to resist the temptation to do and, instead, build the great people that will design, build and operate the great buildings. Running firms like Mack-Cali Realty Corp. and MAG Partners is all about nurturing and unleashing a culture of excellence and creating endless possibilities for the people around you.

The most challenging part of my job is: Finding enough time in the day to do everything I want to do. My mind is constantly churning; there’s always more to do no matter how much you delegate. I wouldn’t change it for anything, but I make sure to dedicate thinking time to work “on” the business and not just “in” the business.

I know I’ve done my job well when: The New York metro real estate industry looks like the people we serve. Our industry’s diversity (or lack thereof) still does not reflect our diverse and eclectic customer base, and that needs to change. When the real estate industry is defined by an inclusive, diverse and merit-based pool of professionals at every level, mission accomplished.

A tip I’ve learned that’s helped me with networking is: Place a great value on human connection and the power of your words and deeds. Reputation and integrity take time to build and an instant to destroy.

The best advice I’ve received for career development is: Stay curious and always be learning.

The attributes I look for in a candidate when hiring are: Passion, purpose and guts.

Do you serve as a mentor for someone? If so, how do you try and fill that role?: Because I feel like it’s my duty to give back, I have always mentored young professionals over the years. There is no magic elixir, but telling my story and sharing what I have learned along the way can empower the next generation of real estate minds.

Do you have a mentor yourself? If so, what do you look for from that individual?: Mentoring has played an outsized role in my professional evolution. The role of mentor or mentee is critical to the career development of the women in our field. My two most influential mentors have been Bruce Ratner and Mary Ann Tighe. With both of them in my corner, I hit the career lottery.

Knowing what you know now: What advice would you give yourself 10 years ago?: Invest in Zoom.

How would you describe what the year 2020 has been like?: Nothing typical. Challenges spinning out from L&L MAG to MAG Partners and assuming the role at Mack-Cali have kept me busy.

What’s been the biggest challenge of this pandemic-driven year for you?: Not being with my MAG Partners team. We have Zoomed three times a week, but nothing beats that personal connection you get from being in the office. Oh, and making sure the kitchen is always stocked for my three kids. I forgot how much they eat.  

What, if anything, has developed for you this year that could perhaps pay dividends in the years to come?: Does becoming interim CEO at Mack-Cali count as a developed skill? I’ve always been nimble but have continued to stretch myself this year, and that will always pay off in the long run.

Charities/foundations/causes I regularly support: I’m honored to be on the board of trustees for Brooklyn Academy of Music and New York Public Radio, two wonderful organizations that serve NYC with great news and culture.

Favorite vacation spot: Anywhere with a beach.

Book I’ve read recently that I’d recommend: One that I’ve actually gone back to a few times is “The Elegance of the Hedgehog.”

TV show, movie or program you would find me watching if I had several hours of viewing time available: I’m actually looking for a new show right now. Any suggestions?

Something about me that would surprise my fellow Women of Influence honorees: I am an introvert

Hashtag for my life: #idontdo#



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September 28, 2020
Commercial Observer

Big Mack Attack: How MaryAnne Gilmartin Is Working to Turn Around Mack-Cali

There’s nothing like an uprising from investors to oust a company’s chief executive to spice up a global pandemic.

After a proxy battle last year shook up the Mack-Cali Realty Corporation’s board of directors, one of New Jersey’s largest landlords faced another clash in mid-March when an activist investor called for the resignation of CEO Michael DeMarco.

The investors got their wish in July when DeMarco left his post after nearly five years as the pandemic waned on. In his wake, the company named real estate titan MaryAnne Gilmartin, who cut her teeth at Forest City Ratner, to serve as interim CEO for six months. (DeMarco couldn’t be reached for comment.)

“I think it’s an outstanding choice given her background both on the public and private side and her expertise in large, complex developments and working through complex structures,” Thomas Catherwood, an analyst at BTIG who covers Mack-Cali, said. “I think she’s uniquely suited for the task of taking over what is a complex company.”

CBRE’s Mary Ann Tighe said Gilmartin has a “persuasive ability” to get people to get on board with her plans — convincing the legendary Manhattan broker to help out on a Jersey City project, for instance — who has “outperformed” her entire career. Tighe first met Gilmartin when Forest City Ratner was pitching, and eventually won, the chance to build the New York Times Building at 620 Eighth Avenue.

“Nobody thought they were a serious contender for the job,” Tighe said. “Bruce Ratner did a great job, but I can tell you MaryAnne carried the day. All the New York developers were stunned and it was because she had a vision for The New York Times — as did Bruce clearly — and they were able to execute that.”

And it’s not just outsiders pleased with the choice. Ronald Dickerman, founder and president of Madison International Realty, which acquired a 5 percent stake in Mack-Cali last year, also heaped praise on Gilmartin.

“She’s very, very bright, very capable and I think that she will do well,” Dickerman said. “We certainly agree that the company needs to continue its evolution.”

Gilmartin, who is splitting her time with running her own firm, MAG Partners, said she’s “hit the ground running” in her nearly two months at the helm of Mack-Cali in order to bring about the change investors have been clamoring for at “warp speed.”

“I’ve done a couple of big moves in a little bit of time,” Gilmartin said. “This is an interim position, but we’re not going to wait to make strategic changes to move the company forward and to deliver better value to the shareholders.”

Banking on the ‘burbs
So far Gilmartin has quickened the pace of Mack-Cali’s strategy to sell off suburban office holdings to shore up its balance sheet and focus on multifamily and office properties in higher-density waterfront spots like Jersey City.

In July, Mack-Cali sold off its Madison, N.J., office property at 3 Giralda Farms for $7.8 million and in mid-September its Florham Park property at 325 Columbia Turnpike for an undisclosed amount, CoStar Group reported. On Sept. 17, Mack-Cali closed on a $160 million sale of a 10-building office portfolio in Morris County, N.J., to Onyx Equities, Taconic Capital Advisors, Axonic Capital and Machine Investment Group. Gilmartin said Mack-Cali expects to get rid of more in the next quarter.

“It gives us the opportunity to pay down corporate debt and also invest in the waterfront assets of Jersey City,” Gilmartin said.

Gilmartin has also shaken up Mack-Cali’s staff. She brought in new people to fill key roles at the company, including a new head of leasing she can’t announce yet as well as former Forest City Ratner and MAG Partners vets Rob Willis, Adam Greene and Ashley Cotton. And, in August, the company tapped Basis Investment Group CEO Tammy Jones to serve as lead independent director of its board.

The new hires haven’t come without some pain. In early September, Mack-Cali laid off about 20 people on its nearly 300-person staff. Gilmartin couldn’t give the details on the divisions targeted in the cuts but said some were related to the disposition of certain assets, while, for others, Mack-Cali outsourced the roles.

“Obviously, that’s always as a CEO one of the hardest things you’ll ever do, but as a public company, a bloated [general and administrative expense] is never a good thing, particularly in challenging times,” Gilmartin said.

Aside from staffing shakeups, Gilmartin has turned her focus strongly on the 4.5 million-square-foot Harborside office campus on Jersey City’s waterfront. The site has faced plenty of vacancies after the company started a $75 million renovation in 2018.

“I think it’s probably the most underrated piece of commercial real estate in the region,” Gilmartin said. “Repositioning Harborside as a campus on the Jersey City waterfront when we all go back to the office is a major, major priority of mine.”

To help those efforts, Gilmartin tapped CBRE’s Tighe to come across the Hudson River and help build a New Jersey-based team to lease up the property while pitching the property to Manhattan tenants.

“This isn’t one of these cases where you go and say ‘It needs everything,’” Tighe said. “You don’t have that reaction at all. You have the reaction that this is a very under-appreciated asset and MaryAnne has a very clear vision of what to do.”

Tighe will continue to market the property to the traditional tenants that filled it — financial institutions and law firms — but also wants to appeal to tech companies that might be attracted by the vibrant neighborhoods nearby.

“I think what New York City companies and brokers — because you’re always marketing to the brokers — haven’t seen is the evolution of Jersey City itself,” Tighe said. “Now you got this cool residential neighborhood that is all over.”

Plus, the area might save companies significant sums. CBRE marketing materials show tenants could pay nearly 32 percent less than the average rent in Downtown Manhattan and nearly 50 percent less than Midtown renting at Harborside.

Even with all the changes in a short time, there’s still a lot to overcome before Mack-Cali can shake off the past missteps and come out on the other side. The company has millions of square feet of its suburban portfolio to sell off and the pandemic likely cut the costs it could fetch for it.

“It’s probably going to be a little more challenging in the COVID environment,” Gilmartin said about the selloffs. “Everybody’s talking about the suburbs having a second coming. It’s hard for me to know if that’s true, but I can assure you we’re going to market into that story because there are definitely buyers out there who believe that.”

Mack-Cali’s stock price has dropped by nearly 9 percent since January; and, in July, before Gilmartin took the helm, Fitch Ratings downgraded the REIT to a negative outlook of BB-. Fitch cited the company’s “high leverage, weak liquidity coverage, active development program, limited unsecured debt and equity capital access and moderate complexity from joint venture (JV) investments” as reasons for the drop.

BTIG’s Catherwood said that while the company has some amazing land holdings in Jersey City and Weehawken, its huge debt load — it’s carrying a debt to equity ratio of 1.38 — makes it hard to capitalize on it.

“I don’t think they have the time horizon to fully build out their land bank in the company’s current structure,” Catherwood said. “Something is going to need to happen: whether it’s a different type of partnership, whether it’s some sort of recapitalization, whether it’s an outright sale. The problem it faces right now is it’s a company going through growing pains.”

The weight
A lot of Mack-Cali’s debt came from the company’s huge push into the multifamily market nearly a decade ago.

Mack-Cali started in 1969 as Cali Associates when John Cali built his first office property in Cranford, N.J., The New York Times reported. He kept going and developed office buildings all around New Jersey, including the International Financial Tower in Jersey City.

The company went public in 1994, and became Mack-Cali when it merged with fellow New Jersey firm the Mack Company in 1997, The Wall Street Journal reported. Things started to take a turn for the worse when former Mack Company head William Mack left in 1999, and Mitchell Hersh became CEO.

Hersh started a huge push into the multifamily market in 2011, which kicked into high gear in 2012 when Mack-Cali acquired residential developer Roseland Partners for $134.6 million, the Journal reported. Since then, the company has built huge luxury developments like Urby and the Soho Lofts, both in Jersey City.

However, Hersh faced criticism for his brash management style. The company, too, kept underperforming in the early 2010s while the rest of the real estate sector improved. Hersh left in 2015, with Mitchell Rudin taking over as CEO and DeMarco as president. DeMarco was later bumped to CEO and Rudin became a vice chairman. Rudin eventually left for Savills in 2018.

DeMarco and Rudin faced the task of dealing with Mack-Cali’s high vacancy rate throughout its nearly 25 million-square-foot suburban office portfolio while it carried one of the highest levels of debt for any office REIT, the Journal reported.

That high debt level sprang from the company’s controversial push into multifamily, but DeMarco had no other choice but to go all-in on the strategy, Catherwood said.

“The previous management was stuck with a very challenging situation,” Catherwood said. “Really, the only strategy left for them, short of selling the company, was to sell their suburban offices to use that capital to develop more residential assets.”

The company started to aggressively sell off its suburban portfolio to put the money into its waterfront holdings, with it dispossessing $528 million worth of properties in 2017 alone and nearly $400 million in 2018, as Commercial Observer previously reported. It was around this time that Ronald Dickerman saw potential in Mack-Cali, and Madison International bought 4.5 million shares in February 2019.

“It’s a listed property company trading at a large discount to [net asset value] which is executing a transition that, if successful, will leave them with a major concentration of Class A residential and office directly on the Jersey side of the Hudson River across from Hudson Yards, Manhattan West and Brookfield Place,” Dickerman said. “If the company continues executing on the plan, in our view the company will either be much more attractive to REIT shareholders or is likely to sell themselves.”

In DeMarco’s own words, there was no better person to lead the company’s change than himself. In a 2017 interview with NJ.com, DeMarco called himself a “turnaround expert” and a “stone-cold killer.” He had similarly high praise for himself in a 2018 interview with CO.

“I only have one speed; it’s just the way I am,” he said. “If I do something, I do it very well.”

After the battle 
But not everybody was as confident in DeMarco as he was in himself. Investment firm Bow Street, which owns a 4.5 percent stake in Mack-Cali, started a proxy battle in 2019 to install more members on the board after Mack-Cali turned down a $2.4 billion takeover bid that would’ve spun its office portfolio into a separate REIT, The Real Deal reported.

After a very public back-and-forth, Bow Street eventually succeeded and got four members added to Mack-Cali’s board, including Gilmartin. It was then that Gilmartin realized the problems with the company couldn’t be fixed with a simple board shakeup.

“It turned out to be a lot harder to make a difference just because of the way the board was structured,” Gilmartin said. “Once you’re inside, while you’re not under the hood inside the company, you start to appreciate how governance works, the board dynamic; the level of engagement on the part of the board members and all that, to me was, was deeply disappointing and there was lots of room for improvement.”

In March, Bow Street started a push to replace DeMarco, writing in an open letter that, “It is now clear that the rot at Mack-Cali goes far deeper than any of us knew and that more comprehensive action is required to protect shareholders’ investment.”

“Having lost two proxy battles in successive years, I haven’t come across that in any other REIT,” Catherwood said. “To completely overhaul the board, to completely overhaul the corporate governing structure and then the change in the C-suite is really indicative of a sea change at the company.”

Gilmartin took over either for six months or until the company finds a permanent CEO. Mack-Cali will in turn pay MAG Partners a monthly fee of $150,000, a sign-on bonus of $300,000 and a $200,000 completion bonus, according to Securities and Exchange Commission filings.

Gilmartin said she’s up for the task of changing the company while continuing to run MAG Partners — which she said is having its staff step up to help run it — and searching for a permanent CEO. She’s confident in Mack-Cali because she said it already has most of what it needs to turn around.

“It’s been really intense, but really, really great,” she said. “You need great assets and you need great people. Mack-Cali has both.”



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