BOSTON — Mack-Cali Realty Corp. (NYSE: CLI), an Edison, N.J.-based REIT, has acquired Alterra at Overlook Ridge IA for approximately $61.3 million and Alterra at Overlook Ridge IB for approximately $88.7 million. The two properties are luxury multifamily communities containing 722 units in the master-planned community of Overlook Ridge in Revere in metro Boston.
A subsidiary of Roseland, which Mack-Cali recently acquired, developed Alterra IA in 2004 and Alterra IB in 2008. The subsidiary has managed the properties since completion.
“The acquisition of Alterra perfectly complements our recent acquisition of the real estate development and management businesses of Roseland and its imminent development interests at Overlook Ridge,” says Mitchell Hersh, president and CEO of Mack-Cali. “We expect to place mortgage financing on the property that will provide a cash-on-cash yield in excess of 9 percent.”
A joint venture including Prudential Insurance Co. of America sold the two properties, which are 97.2 percent occupied. Mack-Cali expects the transaction to close in early April when the loan that encumbers the property opens for prepayment.
The two Class A communities feature heated outdoor pools, fitness centers, lounges, business centers, cinema screening rooms and direct-access parking garages. The communities are located five miles north of downtown Boston and residents have access to the MBTA bus service, as well as a private shuttle.
“We were attracted to this acquisition because these premier assets represent the finest in luxury, location, and amenities, and are consistent with the highest-quality properties in the marketplace, as well as the opportunity for a value-add component,” says Marshall Tycher, co-president of Roseland. “With a planned interior cosmetic modernization we are confident we can command today’s higher market rents.”
In addition to managing the Alterra communities, Roseland developed and managed the adjacent Quarrystone property. The company is also constructing the 371-unit Highlands at Overlook Ridge in a joint venture with UBS.
Mack-Cali provides management, leasing and development services for its real estate portfolio, which spans 271 office properties and seven multifamily communities in the Northeast.
Mack-Cali’s stock price closed Tuesday at $27.37 per share, down from $28.24 a year ago.
— John Nelson