2022
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Veris Residential, Inc.
Mack-Cali Realty Corporation
Mack-Cali Realty,
Maryland | 22-3305147 | |||||||
Delaware | 22-3315804 | |||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
Harborside 3, 210 Hudson St., Ste. 400, Jersey City, New Jersey | 07311 | |||||||
(Address of principal executive offices) | (Zip Code) | |||||||
Not Applicable EXPLANATORY NOTE Operating Partnership generates all remaining capital required by the Company’s business. These sources include working capital, net cash provided by operating activities, borrowings under the Company’s revolving credit facility, Page 2021. CONSOLIDATED BALANCE SHEETS (in thousands, except per share amounts) (unaudited) September 30, December 31, ASSETS 2021 2020 Rental property Land and leasehold interests $ 571,672 $ 639,636 Buildings and improvements 3,424,804 3,743,831 Tenant improvements 105,531 171,623 Furniture, fixtures and equipment 96,968 83,553 4,198,975 4,638,643 Less – accumulated depreciation and amortization (561,240) (656,331) 3,637,735 3,982,312 Real estate held for sale, net 497,832 656,963 Net investment in rental property 4,135,567 4,639,275 Cash and cash equivalents 23,308 38,096 Restricted cash 19,809 14,207 Investments in unconsolidated joint ventures 148,507 162,382 Unbilled rents receivable, net 72,951 84,907 Deferred charges, goodwill and other assets, net 163,183 199,541 Accounts receivable 3,842 9,378 Total assets $ 4,567,167 $ 5,147,786 LIABILITIES AND EQUITY Senior unsecured notes, net $ - $ 572,653 Revolving credit facility and term loans 174,000 25,000 Mortgages, loans payable and other obligations, net 2,200,947 2,204,144 Dividends and distributions payable 385 1,493 Accounts payable, accrued expenses and other liabilities 160,397 194,717 Rents received in advance and security deposits 27,938 34,101 Accrued interest payable 5,739 10,001 Total liabilities 2,569,406 3,042,109 Commitments and contingencies Redeemable noncontrolling interests 518,689 513,297 Equity: Mack-Cali Realty Corporation stockholders’ equity: Common stock, $0.01 par value, 190,000,000 shares authorized, 90,947,387 and 90,712,417 shares outstanding 909 907 Additional paid-in capital 2,530,163 2,528,187 Dividends in excess of net earnings (1,223,047) (1,130,277) Total Mack-Cali Realty Corporation stockholders’ equity 1,308,025 1,398,817 Noncontrolling interests in subsidiaries: Operating Partnership 129,748 148,791 Consolidated joint ventures 41,299 44,772 Total noncontrolling interests in subsidiaries 171,047 193,563 Total equity 1,479,072 1,592,380 Total liabilities and equity $ 4,567,167 $ 5,147,786 CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) (unaudited) Three Months Ended Nine Months Ended September 30, September 30, REVENUES 2021 2020 2021 2020 Revenue from leases $ 72,243 $ 67,396 $ 206,950 $ 205,732 Real estate services 2,628 2,876 7,748 8,624 Parking income 3,950 4,033 10,520 12,332 Hotel income 3,018 893 6,785 3,290 Other income 1,905 3,999 9,081 7,021 Total revenues 83,744 79,197 241,084 236,999 EXPENSES Real estate taxes 11,905 11,004 35,958 32,920 Utilities 3,573 3,598 10,816 10,564 Operating services 17,291 19,116 51,831 51,179 Real estate services expenses 3,307 3,299 9,838 10,107 General and administrative 11,292 26,361 43,347 59,423 Dead deal and transaction-related costs 3,671 2,583 6,416 2,583 Depreciation and amortization 29,344 31,769 86,410 93,104 Property impairments - 36,582 6,041 36,582 Land and other impairments, net 3,401 1,292 11,333 23,401 Total expenses 83,784 135,604 261,990 319,863 OTHER (EXPENSE) INCOME Interest expense (15,200) (20,265) (49,364) (61,794) Interest and other investment income (loss) (4,731) 3 (4,620) 42 Equity in earnings (loss) of unconsolidated joint ventures (1,724) 1,373 (2,831) (281) Realized gains (losses) and unrealized gains (losses) on disposition of rental property, net (3,000) - 521 (7,915) Gain on disposition of developable land - - 111 4,813 Gain (loss) on sale of unconsolidated joint venture interests (1,886) - (1,886) - Loss from extinguishment of debt, net - - (46,735) - Total other income (expense) (26,541) (18,889) (104,804) (65,135) Loss from continuing operations (26,581) (75,296) (125,710) (147,999) Discontinued operations: Income from discontinued operations 180 18,403 13,939 60,004 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net 609 15,775 25,469 (23,901) Total discontinued operations, net 789 34,178 39,408 36,103 Net loss (25,792) (41,118) (86,302) (111,896) Noncontrolling interests in consolidated joint ventures 1,137 895 3,670 1,900 Noncontrolling interests in Operating Partnership of income from continuing operations 2,884 7,769 12,858 15,859 Noncontrolling interests in Operating Partnership in discontinued operations (72) (3,283) (3,583) (3,469) Redeemable noncontrolling interests (6,471) (6,471) (19,413) (19,413) Net loss available to common shareholders $ (28,314) $ (42,208) $ (92,770) $ (117,019) Basic earnings per common share: Loss from continuing operations $ (0.34) $ (0.83) $ (1.47) $ (1.73) Discontinued operations 0.01 0.34 0.39 0.36 Net loss available to common shareholders $ (0.33) $ (0.49) $ (1.08) $ (1.37) Diluted earnings per common share: Loss from continuing operations $ (0.34) $ (0.83) $ (1.47) $ (1.73) Discontinued operations 0.01 0.34 0.39 0.36 Net loss available to common shareholders $ (0.33) $ (0.49) $ (1.08) $ (1.37) Basic weighted average shares outstanding 90,941 90,671 90,803 90,639 Diluted weighted average shares outstanding 99,975 100,307 99,870 100,235 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Net loss $ (25,792) $ (41,118) $ (86,302) $ (111,896) Other comprehensive income (loss): Net unrealized gain (loss) on derivative instruments for interest rate swaps - - - (16) Comprehensive loss $ (25,792) $ (41,118) $ (86,302) $ (111,912) Comprehensive (income) loss attributable to noncontrolling interests in consolidated joint ventures 1,137 895 3,670 1,900 Comprehensive (income) loss attributable to redeemable noncontrolling interests (6,471) (6,471) (19,413) (19,413) Comprehensive (income) loss attributable to noncontrolling interests in Operating Partnership 2,812 4,486 9,275 12,424 Comprehensive loss attributable to common shareholders $ (28,314) $ (42,208) $ (92,770) $ (117,001) Accumulated Additional Dividends in Other Noncontrolling Common Stock Paid-In Excess of Comprehensive Interests For the Three Months Ended September 30, 2021 Shares Par Value Capital Net Earnings Income (Loss) in Subsidiaries Total Equity Balance at July 1, 2021 90,947 $ 909 $ 2,529,050 $ (1,194,733) $ - $ 175,107 $ 1,510,333 Net income (loss) - - - (28,314) - 2,522 (25,792) Common stock dividends - - - - - - - Common unit distributions - - - - - - - Redeemable noncontrolling interests - - (1,562) - - (6,626) (8,188) Change in noncontrolling interests in consolidated joint ventures - - - - - 12 12 Redemption of common units - - - - - (295) (295) Shares issued under Dividend Reinvestment and Stock Purchase Plan - - 4 - - - 4 Directors' deferred compensation plan - - 91 - - - 91 Stock compensation - - 1,632 - - 1,275 2,907 Rebalancing of ownership percentage between parent and subsidiaries - - 948 - - (948) - Balance at September 30, 2021 90,947 $ 909 $ 2,530,163 $ (1,223,047) $ - $ 171,047 $ 1,479,072 Accumulated Additional Dividends in Other Noncontrolling Common Stock Paid-In Excess of Comprehensive Interests For the Three Months Ended September 30, 2020 Shares Par Value Capital Net Earnings Income (Loss) in Subsidiaries Total Equity Balance at July 1, 2020 90,597 $ 906 $ 2,533,686 $ (1,135,559) $ - $ 194,463 $ 1,593,496 Net income (loss) - - - (42,208) - 1,090 (41,118) Common stock dividends - - - (18,142) - - (18,142) Common unit distributions - - - - - (2,029) (2,029) Redeemable noncontrolling interests - - (2,167) - - (6,701) (8,868) Change in noncontrolling interests in consolidated joint ventures - - - - - - - Redemption of common units - - - - - (29) (29) Shares issued under Dividend Reinvestment and Stock Purchase Plan 1 - 9 - - - 9 Directors' deferred compensation plan 61 1 75 - - - 76 Stock compensation 53 - 394 - - 329 723 Rebalancing of ownership percentage between parent and subsidiaries - - (875) - - 875 - Balance at September 30, 2020 90,712 $ 907 $ 2,531,122 $ (1,195,909) $ - $ 187,998 $ 1,524,118 Accumulated Additional Dividends in Other Noncontrolling Common Stock Paid-In Excess of Comprehensive Interests For the Nine Months Ended September 30, 2021 Shares Par Value Capital Net Earnings Income (Loss) in Subsidiaries Total Equity Balance at January 1, 2021 90,712 $ 907 $ 2,528,187 $ (1,130,277) $ - $ 193,563 $ 1,592,380 Net income (loss) - - - (92,770) - 6,468 (86,302) Common stock dividends - - - - - - - Common unit distributions - - - - - 643 643 Redeemable noncontrolling interests - - (4,903) - - (19,902) (24,805) Change in noncontrolling interest in consolidated joint ventures - - - - - 197 197 Redemption of common units for common stock 175 2 2,714 - - (2,716) - Redemption of common units - - - - - (11,164) (11,164) Shares issued under Dividend Reinvestment and Stock Purchase Plan 2 - 33 - - - 33 Directors' deferred compensation plan - - 229 - - - 229 Stock compensation 58 - 3,517 - - 4,462 7,979 Cancellation of restricted shares - - (118) - - - (118) Cancellation of unvested LTIP units - - - - - - - Other comprehensive income - - - - - - - Rebalancing of ownership percentage between parent and subsidiaries - - 504 - - (504) - Balance at September 30, 2021 90,947 $ 909 $ 2,530,163 $ (1,223,047) $ - $ 171,047 $ 1,479,072 Accumulated Additional Dividends in Other Noncontrolling Common Stock Paid-In Excess of Comprehensive Interests For the Nine Months Ended September 30, 2020 Shares Par Value Capital Net Earnings Income (Loss) in Subsidiaries Total Equity Balance at January 1, 2020 90,595 $ 906 $ 2,535,440 $ (1,042,629) $ (18) $ 205,776 $ 1,699,475 Net income (loss) - - - (117,019) - 5,123 (111,896) Common stock dividends - - - (36,261) - - (36,261) Common unit distributions - - - - - (3,509) (3,509) Redeemable noncontrolling interests - - (7,207) - - (20,176) (27,383) Change in noncontrolling interests in consolidated joint ventures - - - - - 133 133 Redemption of common units for common stock - - - - - - - Redemption of common units - - - - - (2,170) (2,170) Shares issued under Dividend Reinvestment and Stock Purchase Plan 3 - 39 - - - 39 Directors' deferred compensation plan 61 1 214 - - - 215 Stock compensation 53 - 1,158 - - 4,534 5,692 Cancellatin of restricted shares - - - - - - - Cancellation of unvested LTIP units - - - (201) (201) Other comprehensive income (loss) - - - - 18 (34) (16) Rebalancing of ownership percentage between parent and subsidiaries - - 1,478 - - (1,478) - Balance at September 30, 2020 90,712 $ 907 $ 2,531,122 $ (1,195,909) $ - $ 187,998 $ 1,524,118 CONSOLIDATED STATEMENTS OF CASH FLOWS Nine Months Ended September 30, CASH FLOWS FROM OPERATING ACTIVITIES 2021 2020 Net loss $ (86,302) $ (111,896) Net loss from discontinued operations (39,408) (36,103) Net loss from continuing operations (125,710) (147,999) Adjustments to reconcile net income (loss) to net cash provided by Operating activities: Depreciation and amortization, including related intangible assets 84,173 90,494 Amortization of directors deferred compensation stock units 229 215 Amortization of stock compensation 7,979 5,692 Amortization of deferred financing costs 3,369 3,158 Amortization of debt discount and mark-to-market 232 (711) Equity in (earnings) loss of unconsolidated joint ventures 2,831 281 Distributions of cumulative earnings from unconsolidated joint ventures 759 4,734 Write-off transaction-related costs 3,091 - Realized (gains) losses and unrealized (gains) losses on disposition of rental property, net (521) 7,915 Gain on disposition of developable land (111) (4,813) Land and other impairments, net 11,333 23,401 Property impairments 6,041 36,582 Loss from sale of investment in unconsolidated joint venture 1,886 - Loss from extinguishment of debt 46,735 - Loan loss allowance charge 5,152 - Changes in operating assets and liabilities: (Increase) decrease in unbilled rents receivable, net (7,056) 866 Increase in deferred charges, goodwill and other assets (5,163) (4,384) Decrease (increase) in accounts receivable, net 4,213 (5,752) Increase (decrease) in accounts payable, accrued expenses and other liabilities (5,054) (2,928) (Decrease) Increase in rents received in advance and security deposits 1,449 (1,441) Increase in accrued interest payable 237 5,471 Net cash flows provided by operating activities - continuing operations 36,094 10,781 Net cash flows provided by operating activities - discontinued operations 5,081 65,807 Net cash provided by operating activities $ 41,175 $ 76,588 CASH FLOWS FROM INVESTING ACTIVITIES Rental property acquisitions and related intangibles $ - $ (16,214) Rental property additions and improvements (49,129) (123,797) Development of rental property and other related costs (165,715) (227,509) Proceeds from the sales of rental property 42,702 16,455 Proceeds from the sale of unconsolidated joint venture interests 3,865 - Repayment of notes receivable 494 333 Investment in unconsolidated joint ventures (629) (1,664) Distributions in excess of cumulative earnings from unconsolidated joint ventures 5,656 11,960 Net cash used in investing activities - continuing operations (162,756) (340,436) Net cash provided by investing activities - discontinued operations 620,772 257,474 Net cash provided by (used in) investing activities $ 458,016 $ (82,962) CASH FLOW FROM FINANCING ACTIVITIES Borrowings from revolving credit facility $ 186,000 $ 191,000 Repayment of revolving credit facility (37,000) (364,000) Borrowings from term loans 150,000 - Repayments of term loans (150,000) - Repayments of senior unsecured notes (573,727) - Proceeds from mortgages and loans payable 123,707 258,483 Repayment of mortgages, loans payable and other obligations (129,907) (298) Payment of early debt extinguishment costs (49,874) - Common unit redemptions (550) (2,170) Payment of financing costs (7,339) (668) Contributions from noncontrolling interests 197 133 Distributions to redeemable noncontrolling interests (19,413) (19,412) Payment of common dividends and distributions (469) (60,483) Net cash (used in) provided by financing activities $ (508,375) $ 2,585 Net decrease in cash and cash equivalents $ (9,184) $ (3,789) Cash, cash equivalents and restricted cash, beginning of period (1) 52,302 41,168 Cash, cash equivalents and restricted cash, end of period (2) $ 43,118 $ 37,379 CONSOLIDATED BALANCE SHEETS (in thousands, except per unit amounts) (unaudited) September 30, December 31, ASSETS 2021 2020 Rental property Land and leasehold interests $ 571,672 $ 639,636 Buildings and improvements 3,424,804 3,743,831 Tenant improvements 105,531 171,623 Furniture, fixtures and equipment 96,968 83,553 4,198,975 4,638,643 Less – accumulated depreciation and amortization (561,240) (656,331) 3,637,735 3,982,312 Real estate held for sale, net 497,832 656,963 Net investment in rental property 4,135,567 4,639,275 Cash and cash equivalents 23,308 38,096 Restricted cash 19,809 14,207 Investments in unconsolidated joint ventures 148,507 162,382 Unbilled rents receivable, net 72,951 84,907 Deferred charges, goodwill and other assets, net 163,183 199,541 Accounts receivable 3,842 9,378 Total assets $ 4,567,167 $ 5,147,786 LIABILITIES AND EQUITY Senior unsecured notes, net $ - $ 572,653 Revolving credit facility and term loans 174,000 25,000 Mortgages, loans payable and other obligations, net 2,200,947 2,204,144 Distributions payable 385 1,493 Accounts payable, accrued expenses and other liabilities 160,397 194,717 Rents received in advance and security deposits 27,938 34,101 Accrued interest payable 5,739 10,001 Total liabilities 2,569,406 3,042,109 Commitments and contingencies Redeemable noncontrolling interests 518,689 513,297 Partners’ Capital: General Partner, 90,947,387 and 90,712,417 common units outstanding 1,238,752 1,330,048 Limited partners, 9,021,400 and 9,649,031 common units/LTIPs outstanding 199,021 217,560 Total Mack-Cali Realty, L.P. partners’ capital 1,437,773 1,547,608 Noncontrolling interests in consolidated joint ventures 41,299 44,772 Total equity 1,479,072 1,592,380 Total liabilities and equity $ 4,567,167 $ 5,147,786 (in thousands, except per share amounts) (unaudited) CONSOLIDATED STATEMENTS OF Three Months Ended Nine Months Ended September 30, September 30, REVENUES 2021 2020 2021 2020 Revenue from leases $ 72,243 $ 67,396 $ 206,950 $ 205,732 Real estate services 2,628 2,876 7,748 8,624 Parking income 3,950 4,033 10,520 12,332 Hotel income 3,018 893 6,785 3,290 Other income 1,905 3,999 9,081 7,021 Total revenues 83,744 79,197 241,084 236,999 EXPENSES Real estate taxes 11,905 11,004 35,958 32,920 Utilities 3,573 3,598 10,816 10,564 Operating services 17,291 19,116 51,831 51,179 Real estate services expenses 3,307 3,299 9,838 10,107 General and administrative 11,292 26,361 43,347 59,423 Dead deal and transaction-related costs 3,671 2,583 6,416 2,583 Depreciation and amortization 29,344 31,769 86,410 93,104 Property impairments - 36,582 6,041 36,582 Land and other impairments, net 3,401 1,292 11,333 23,401 Total expenses 83,784 135,604 261,990 319,863 OTHER (EXPENSE) INCOME Interest expense (15,200) (20,265) (49,364) (61,794) Interest and other investment income (loss) (4,731) 3 (4,620) 42 Equity in earnings (loss) of unconsolidated joint ventures (1,724) 1,373 (2,831) (281) Realized gains (losses) and unrealized gains (losses) on disposition of rental property, net (3,000) - 521 (7,915) Gain on disposition of developable land - - 111 4,813 Gain (loss) on sale of unconsolidated joint venture interests (1,886) - (1,886) - Loss from extinguishment of debt, net - - (46,735) - Total other income (expense) (26,541) (18,889) (104,804) (65,135) Loss from continuing operations (26,581) (75,296) (125,710) (147,999) Discontinued operations: Income from discontinued operations 180 18,403 13,939 60,004 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net 609 15,775 25,469 (23,901) Total discontinued operations, net 789 34,178 39,408 36,103 Net loss (25,792) (41,118) (86,302) (111,896) Noncontrolling interests in consolidated joint ventures 1,137 895 3,670 1,900 Redeemable noncontrolling interests (6,471) (6,471) (19,413) (19,413) Net loss available to common unitholders $ (31,126) $ (46,694) $ (102,045) $ (129,409) Basic earnings per common unit: Loss from continuing operations $ (0.34) $ (0.83) $ (1.47) $ (1.73) Discontinued operations 0.01 0.34 0.39 0.36 Net loss available to common unitholders $ (0.33) $ (0.49) $ (1.08) $ (1.37) Diluted earnings per common unit: Loss from continuing operations $ (0.34) $ (0.83) $ (1.47) $ (1.73) Discontinued operations 0.01 0.34 0.39 0.36 Net loss available to common unitholders $ (0.33) $ (0.49) $ (1.08) $ (1.37) Basic weighted average units outstanding 99,975 100,307 99,870 100,235 Diluted weighted average units outstanding 99,975 100,307 99,870 100,235 CONSOLIDATED STATEMENTS OF Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Net loss $ (25,792) $ (41,118) $ (86,302) $ (111,896) Other comprehensive income (loss): Net unrealized gain (loss) on derivative instruments for interest rate swaps - - - (16) Comprehensive loss $ (25,792) $ (41,118) $ (86,302) $ (111,912) Comprehensive (income) loss attributable to noncontrolling interests in consolidated joint ventures 1,137 895 3,670 1,900 Comprehensive (income) loss attributable to redeemable noncontrolling interests (6,471) (6,471) (19,413) (19,413) Comprehensive loss attributable to common unitholders $ (31,126) $ (46,694) $ (102,045) $ (129,425) CONSOLIDATED STATEMENTS OF Accumulated Noncontrolling Limited Partner General Partner Limited Partner Other Interest General Partner Common Units/ Common Common Comprehensive in Consolidated For the Three Months Ended September 30, 2021 Common Units Vested LTIP Units Unitholders Unitholders Income (Loss) Joint Ventures Total Equity Balance at July 1, 2021 90,947 9,038 $ 1,266,901 $ 201,008 $ - $ 42,424 $ 1,510,333 Net income (loss) - - (28,314) (2,812) - 5,334 (25,792) Distributions to unitholders - - - - - - - Redeemable noncontrolling interests - - (1,562) (155) - (6,471) (8,188) Change in noncontrolling interests in consolidated joint ventures - - - - - 12 12 Vested LTIP units - - - - - - - Redemption of limited partner common units - (17) - (295) - - (295) Shares issued under Dividend Reinvestment and Stock Purchase Plan - - 4 - - - 4 Directors' deferred compensation plan - - 91 - - - 91 Stock compensation - - 1,632 1,275 - - 2,907 Balance at September 30, 2021 90,947 9,021 $ 1,238,752 $ 199,021 $ - $ 41,299 $ 1,479,072 Accumulated Noncontrolling Limited Partner General Partner Limited Partner Other Interest General Partner Common Units/ Common Common Comprehensive in Consolidated For the Three Months Ended September 30, 2020 Common Units Vested LTIP Units Unitholders Unitholders Income (Loss) Joint Ventures Total Equity Balance at July 1, 2020 90,597 9,586 $ 1,330,531 $ 216,541 $ - $ 46,424 $ 1,593,496 Net income (loss) - - (42,208) (4,486) - 5,576 (41,118) Distributions to unitholders - - (18,142) (2,029) - - (20,171) Redeemable noncontrolling interests - - (2,167) (230) - (6,471) (8,868) Change in noncontrolling interests in consolidated joint ventures - - - - - - - Vested LTIP units - 88 - - - - - Redemption of limited partners common units - (2) - (29) - - (29) Shares issued under Dividend Reinvestment and Stock Purchase Plan 1 - 9 - - - 9 Directors' deferred compensation plan 61 - 76 - - - 76 Stock compensation 53 - 394 329 - - 723 Balance at September 30, 2020 90,712 9,672 $ 1,268,493 $ 210,096 $ - $ 45,529 $ 1,524,118 The accompanying notes are an integral part of these consolidated financial statements. Accumulated Noncontrolling Limited Partner General Partner Limited Partner Other Interest General Partner Common Units/ Common Common Comprehensive in Consolidated For the Nine Months Ended September 30, 2021 Common Units Vested LTIP Units Unitholders Unitholders Income (Loss) Joint Ventures Total Equity Balance at January 1, 2021 90,712 9,649 $ 1,330,048 $ 217,560 $ - $ 44,772 $ 1,592,380 Net income (loss) - - (92,770) (9,275) - 15,743 (86,302) Distributions to unitholders - - - 643 - - 643 Redeemable noncontrolling interests - - (4,903) (489) - (19,413) (24,805) Change in noncontrolling interests in consolidated joint ventures - - - - - 197 197 Redemption of limited partner common units for shares of general partner common units 175 (175) 2,716 (2,716) - - - Vested LTIP units - 267 - - - - - Redemption of limited partner common units - (720) - (11,164) - - (11,164) Shares issued under Dividend Reinvestment and Stock Purchase Plan 2 - 33 - - - 33 Directors' deferred compensation plan - - 229 - - - 229 Other comprehensive income - - - - - - - Stock compensation 58 - 3,517 4,462 - - 7,979 Cancellation of restricted shares - - (118) - - - (118) Cancellation of unvested LTIP units - - - - - - - Balance at September 30, 2021 90,947 9,021 $ 1,238,752 $ 199,021 $ - $ 41,299 $ 1,479,072 Accumulated Noncontrolling Limited Partner General Partner Limited Partner Other Interest General Partner Common Units/ Common Common Comprehensive in Consolidated For the Nine Months Ended September 30, 2020 Common Units Vested LTIP Units Unitholders Unitholders Income (Loss) Joint Ventures Total Equity Balance at January 1, 2020 90,595 9,612 $ 1,427,568 $ 224,629 $ (18) $ 47,296 $ 1,699,475 Net income (loss) - - (117,019) (12,390) - 17,513 (111,896) Distributions to unitholders - - (36,261) (3,509) - - (39,770) Redeemable noncontrolling interests - - (7,207) (763) - (19,413) (27,383) Change in noncontrolling interest in consolidated joint ventures - - - - - 133 133 Redemption of limited partner common units for shares of general partner common units - - - - - - - Vested LTIP units - 160 - - - - - Redemption of limited partner common units - (100) - (2,170) - - (2,170) Shares issued under Dividend Reinvestment and Stock Purchase Plan 3 - 39 - - - 39 Directors' deferred compensation plan 61 - 215 - - - 215 Other comprehensive income (loss) - - - (34) 18 - (16) Stock compensation 53 - 1,158 4,534 - - 5,692 Cancellation of restricted shares - - - - - - - Cancellation of unvested LTIP units - - - (201) - - (201) Balance at September 30, 2020 90,712 9,672 $ 1,268,493 $ 210,096 $ - $ 45,529 $ 1,524,118 Nine Months Ended September 30, CASH FLOWS FROM OPERATING ACTIVITIES 2021 2020 Net loss $ (86,302) $ (111,896) Net loss from discontinued operations (39,408) (36,103) Net loss from continuing operations (125,710) (147,999) Adjustments to reconcile net income (loss) to net cash provided by Operating activities: Depreciation and amortization, including related intangible assets 84,173 90,494 Amortization of directors deferred compensation stock units 229 215 Amortization of stock compensation 7,979 5,692 Amortization of deferred financing costs 3,369 3,158 Amortization of debt discount and mark-to-market 232 (711) Equity in (earnings) loss of unconsolidated joint ventures 2,831 281 Distributions of cumulative earnings from unconsolidated joint ventures 759 4,734 Write-off transaction-related costs 3,091 - Realized (gains) losses and unrealized (gains) losses on disposition of rental property, net (521) 7,915 Gain on disposition of developable land (111) (4,813) Land and other impairments, net 11,333 23,401 Property impairments 6,041 36,582 Loss from sale of investment in unconsolidated joint venture 1,886 - Loss from extinguishment of debt 46,735 - Loan loss allowance charge 5,152 - Changes in operating assets and liabilities: (Increase) decrease in unbilled rents receivable, net (7,056) 866 Increase in deferred charges, goodwill and other assets (5,163) (4,384) Decrease (increase) in accounts receivable, net 4,213 (5,752) Increase (decrease) in accounts payable, accrued expenses and other liabilities (5,054) (2,928) (Decrease) Increase in rents received in advance and security deposits 1,449 (1,441) Increase in accrued interest payable 237 5,471 Net cash flows provided by operating activities - continuing operations 36,094 10,781 Net cash flows provided by operating activities - discontinued operations 5,081 65,807 Net cash provided by operating activities $ 41,175 $ 76,588 CASH FLOWS FROM INVESTING ACTIVITIES Rental property acquisitions and related intangibles $ - $ (16,214) Rental property additions and improvements (49,129) (123,797) Development of rental property and other related costs (165,715) (227,509) Proceeds from the sales of rental property 42,702 16,455 Proceeds from the sale of unconsolidated joint venture interests 3,865 - Repayment of notes receivable 494 333 Investment in unconsolidated joint ventures (629) (1,664) Distributions in excess of cumulative earnings from unconsolidated joint ventures 5,656 11,960 Net cash used in investing activities - continuing operations (162,756) (340,436) Net cash provided by investing activities - discontinued operations 620,772 257,474 Net cash provided by (used in) investing activities $ 458,016 $ (82,962) CASH FLOW FROM FINANCING ACTIVITIES Borrowings from revolving credit facility $ 186,000 $ 191,000 Repayment of revolving credit facility (37,000) (364,000) Borrowings from term loans 150,000 - Repayments of term loans (150,000) - Repayment of unsecured term loan (573,727) - Proceeds from mortgages and loans payable 123,707 258,483 Repayment of mortgages, loans payable and other obligations (129,907) (298) Payment of early debt extinguishment costs (49,874) - Common unit redemptions (550) (2,170) Payment of financing costs (7,339) (668) Contributions from noncontrolling interests 197 133 Distributions to redeemable noncontrolling interests (19,413) (19,412) Payment of distributions (469) (60,483) Net cash (used in) provided by financing activities $ (508,375) $ 2,585 Net decrease in cash and cash equivalents $ (9,184) $ (3,789) Cash, cash equivalents and restricted cash, beginning of period (1) 52,302 41,168 Cash, cash equivalents and restricted cash, end of period (2) $ 43,118 $ 37,379 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(unaudited) under the voting interest model. Under the revised guidance, the Operating September 30, December 31, 2021 2020 Land held for development (including pre-development costs, if any) (a)(c) $ 354,993 $ 364,946 Development and construction in progress, including land (b) 731,143 733,560 Total $ 1,086,136 $ 1,098,506 for as a separate project. The Company allocates costs incurred between the portions under construction and the portions substantially completed and held available for occupancy, primarily based on a percentage of the relative commercial square footage or The Company anticipates its regular quarterly common dividend to remain suspended in 2022 while it seeks to conclude its transition into a pureplay multifamily REIT. Total In Service Property # of Development Date Property Location Type Apartment Units Costs Incurred 03/01/21 The Upton (a) Short Hills, NJ Multi-Family 193 $ 100,726 07/01/21 Riverhouse 9 (b) Weekawken, NJ Multi-Family 313 161,787 Totals 506 $ 262,513 currently available for occupancy. a strategic shift in the Company’s operations net of expected selling costs but before the extinguishment of $250 million of mortgages encumbering an office property and related costs, are expected to be approximately $516.2 million. Suburban Other Office Assets Portfolio (a) Held for Sale Total Land $ 8,452 $ 94,999 $ 103,451 Building & Other 44,450 564,080 608,530 Less: Accumulated depreciation (20,052) (167,529) (187,581) Less: Cumulative unrealized losses on property held for sale (9,762) (16,806) (26,568) Real estate held for sale, net $ 23,088 $ 474,744 $ 497,832 Suburban Other Office Assets Other assets and liabilities Portfolio (a) Held for Sale Total Unbilled rents receivable, net (b) $ 427 $ 30,083 $ 30,510 Deferred charges, net (b) 839 16,988 17,827 Total intangibles, net (b) - 31,155 31,155 Total deferred charges & other assets, net (c) 1,727 67,964 69,691 Mortgages & loans payable, net (b) - 397,867 397,867 Total below market liability (b) - 24,627 24,627 Accounts payable, accrued exp & other liability (d) 5,532 50,547 56,079 Unearned rents/deferred rental income (b) 809 6,926 7,735 The Company disposed of the following rental Discontinued Operations: Realized Realized Gains Gains Rentable Net Net (Losses)/ (losses)/ Disposition # of Square Property Sales Carrying Unrealized Unrealized Date Property/Address Location Bldgs. Feet Type Proceeds Value Losses, net Losses, net 01/13/21 100 Overlook Center Princeton, New Jersey 1 149,600 Office $ 34,724 (a) $ 26,488 $ 8,236 03/25/21 Metropark portfolio (b) Edison and Iselin, New Jersey 4 926,656 Office 247,351 233,826 13,525 04/20/21 Short Hills portfolio (c) Short Hills, New Jersey 4 828,413 Office 248,664 245,800 2,864 06/11/21 Red Bank portfolio Red Bank, New Jersey 5 659,490 Office 80,730 78,364 2,366 06/30/21 Retail land leases Hanover and Parsippany, New Jersey - - Land Lease 41,957 37,951 $ 4,006 - 07/26/21 7 Giralda Farms Madison, New Jersey 1 236,674 Office 28,182 30,143 (1,961) Sub-total 15 2,800,833 681,608 652,572 4,006 25,030 Unrealized gains(losses) on real estate held for sale (3,485) 439 Totals 15 2,800,833 $ 681,608 $ 652,572 $ 521 $ 25,469 2022. See Note 5: Deferred Charges and Other Assets, Net. operation. Property Debt Number of Company's Carrying Value As of September 30, 2021 Apartment Units Effective September 30, December 31, Maturity Interest Entity / Property Name or Rentable SF Ownership % (a) 2021 2020 Balance Date Rate Multi-family Metropolitan and Lofts at 189 units 25.00 % $ 2,688 $ 3,347 $ 60,767 (d) (d) RiverTrace at Port Imperial 316 units 22.50 % 6,139 6,667 82,000 11/10/26 3.21 % PI North - Riverwalk C (e) 360 units 40.00 % 36,709 36,992 103,954 12/06/21 L+ 2.75 % Riverpark at Harrison (k) 141 units 45.00 % (521) 681 30,192 07/01/35 3.19 % Station House 378 units 50.00 % 33,542 34,026 93,789 07/01/33 4.82 % Urby at Harborside (f) 762 units 85.00 % 67,588 72,752 191,805 08/01/29 5.197 % PI North - Land (b) (g) 771 potential units 20.00 % 1,678 1,678 - - - Liberty Landing 850 potential units 50.00 % 337 337 - - - Office 12 Vreeland Road (h) 139,750 sf 50.00 % - 1,811 - - - Offices at Crystal Lake (i) 106,345 sf 31.25 % - 3,744 - - - Other Hyatt Regency Hotel Jersey City 351 rooms 50.00 % - - 100,000 10/01/26 3.668 % Other (j) 347 347 - - - Totals: $ 148,507 $ 162,382 $ 662,507 are related to its core operations. These ventures are not expected to significantly impact the Company's operations in the near term. Three Months Ended Nine Months Ended September 30, September 30, Entity / Property Name 2021 2020 2021 2020 Multi-family Metropolitan and Lofts at 40 Park $ (163) $ (276) $ (659) $ (611) RiverTrace at Port Imperial (4) (3) (14) 130 Crystal House (c) - (257) - (598) PI North - Riverwalk C (d) 171 (102) (287) (340) Riverpark at Harrison (e) (1,008) (62) (1,135) (186) Station House (291) (677) (1,109) (1,816) Urby at Harborside (1,026) 1,924 (90) 1,915 PI North - Land (38) - (156) - Liberty Landing (3) - (3) - Office 12 Vreeland Road - 92 2 350 Offices at Crystal Lake (f) 22 72 (113) 147 Other Riverwalk Retail (b) - - - (11) Hyatt Regency Hotel Jersey City - 412 - 363 Other 616 250 733 376 Company's equity in earnings (loss) of unconsolidated joint ventures (a) $ (1,724) $ 1,373 $ (2,831) $ (281) September 30, December 31, (dollars in thousands) 2021 2020 Deferred leasing costs $ 89,249 $ 112,421 Deferred financing costs - revolving credit facility (a) 6,684 5,559 95,933 117,980 Accumulated amortization (39,218) (52,428) Deferred charges, net 56,715 65,552 Notes receivable (b) 5,871 1,167 In-place lease values, related intangibles and other assets, net 42,346 71,608 Goodwill (c) 2,945 2,945 Right of use assets (d) 22,298 22,298 Prepaid expenses and other assets, net 33,008 35,971 Total deferred charges, goodwill and other assets, net (e) $ 163,183 $ 199,541 (b) on the contract in exchange for an up-front premium. (dollars in thousands) : Derivatives in Cash Flow Hedging Relationships Amount of Gain or (Loss) Recognized in OCI on Derivative Location of Gain or (Loss) Reclassified from Accumulated OCI into Income Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income Location of Gain or (Loss) Recognized in Income on Derivative Amount of Gain or (Loss) Recognized in Income on Derivative and Reclassification for Forecasted Transactions No Longer Probable of Occurring) Total Amount of Interest Expense presented in the consolidated statements 2021 2020 2021 2020 2021 2020 2021 2020 Three months ended September 30, Interest rate swaps $ - $ - Interest expense $ - $ - Interest and other investment income (loss) $ - $ - $ (15,200) $ (20,265) Nine months ended September 30, Interest rate swaps $ - $ - Interest expense $ - $ 16 $ - $ - $ (49,364) $ (61,794) interest rate derivatives in a net liability position. 6. RESTRICTED CASH September 30, December 31, 2021 2020 Security deposits $ 6,863 $ 5,289 Escrow and other reserve funds 12,946 8,918 Total restricted cash $ 19,809 $ 14,207 presented. allowance of $4.4 million. Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Total revenues $ 1,018 $ 34,989 $ 28,501 $ 112,563 Operating and other expenses (785) (13,998) (12,027) (44,651) Depreciation and amortization (53) (1,267) (965) (3,974) Interest expense - (1,321) (1,570) (3,934) Income from discontinued operations 180 18,403 13,939 60,004 Unrealized gains (losses) on disposition of rental property (a) 500 15,775 569 (56,998) Realized gains (losses) on disposition of rental property (b) 109 - 24,900 33,097 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net 609 15,775 25,469 (23,901) Total discontinued operations, net $ 789 $ 34,178 $ 39,408 $ 36,103 8. September 30, December 31, Effective 2021 2020 Rate 4.500% Senior Unsecured Notes, due April 18, 2022 (1) $ - $ 300,000 - % 3.150% Senior Unsecured Notes, due May 15, 2023 (1) - 275,000 - % Principal balance outstanding - 575,000 Adjustment for unamortized debt discount - (1,504) Unamortized deferred financing costs - (843) Total senior unsecured notes, net $ - $ 572,653 Interest Rate - Applicable Interest Rate - Basis Points Applicable Above LIBOR for Basis Points Alternate Base Facility Fee Total Leverage Ratio Above LIBOR Rate Loans Basis Points <45% 125.0 25.0 20.0 ≥45% and <50% 130.0 30.0 25.0 ≥50% and <55% (ratio through May 6, 2021) 135.0 35.0 30.0 ≥55% 160.0 60.0 35.0 The Company was in compliance with its debt covenants under its revolving credit facility as of respectively. 2022, except as otherwise disclosed. A summary of the Company’s mortgages, loans payable and other obligations as of Effective September 30, December 31, Property/Project Name Lender Rate (a) 2021 2020 Maturity Port Imperial South 4/5 Retail (m) American General Life & A/G PC 4.56 % $ 3,813 $ 3,866 12/01/21 Port Imperial South 9 (c) Bank of New York Mellon LIBOR+ 2.13 % 79,609 46,357 12/19/22 Portside 7 CBRE Capital Markets/FreddieMac 3.57 % 58,998 58,998 08/01/23 Upton-Short Hills (d) People's United Bank LIBOR+ 2.15 % 57,171 42,459 03/26/23 Port Imperial 4/5 Hotel (b) Fifth Third Bank LIBOR+ 3.40 % 89,000 94,000 04/01/23 250 Johnson Nationwide Life Insurance Company 3.74 % 43,000 43,000 08/01/24 Liberty Towers (e) American General Life Insurance Company 3.37 % 265,000 265,000 10/01/24 Haus 25 (f) QuadReal Finance LIBOR+ 2.70 % 237,288 161,544 12/01/24 Portside 5/6 (g) New York Life Insurance Company 4.56 % 97,000 97,000 03/10/26 BLVD 425 New York Life Insurance Company 4.17 % 131,000 131,000 08/10/26 BLVD 401 New York Life Insurance Company 4.29 % 117,000 117,000 08/10/26 101 Hudson Wells Fargo CMBS 3.20 % 250,000 250,000 10/11/26 Worcester MUFG Union Bank LIBOR+ 1.84 % 63,000 63,000 12/10/26 RXR - Short Hills (h) Wells Fargo CMBS 4.15 % - 124,500 04/01/27 150 Main St. Natixis Real Estate Capital LLC 4.48 % 41,000 41,000 08/05/27 BLVD 475 N/S (i) The Northwestern Mutual Life Insurance Co. 2.91 % 165,000 165,000 11/10/27 Port Imperial South 11 The Northwestern Mutual Life Insurance Co. 4.52 % 100,000 100,000 01/10/29 Soho Lofts (j) New York Community Bank 3.77 % 160,000 160,000 07/01/29 111 River St. Athene Annuity and Life Company 3.90 % 150,000 150,000 09/01/29 Port Imperial South 4/5 Garage (k) American General Life & A/G PC 4.85 % 32,784 33,138 12/01/29 Emery at Overlook Ridge (l) New York Community Bank 3.21 % 72,000 72,000 01/01/31 Principal balance outstanding 2,212,663 2,218,862 Unamortized deferred financing costs (11,716) (14,718) Total mortgages, loans payable and other obligations, net $ 2,200,947 $ 2,204,144 2021. Level 3 valuations within the fair value hierarchy, as there are significant unobservable assumptions. Assumptions that were utilized in the fair value calculations include, but are not limited to, discount rates, market capitalization rates, expected lease rental rates, room rental and food and beverage revenue rates, Description Primary Valuation Unobservable Location Range of Land holdings held for sale and held and used on which the Company recognized impairment losses Developable area and units and market rate per square foot or sale prices per purchase and sale agreements Market rate per residential unit Waterfront $ 2022. The The Company is a defendant in litigation arising in the normal course of its business activities. Management does not believe that the ultimate resolution of these matters will have a materially adverse effect upon the Company’s financial condition taken as whole. As of September 30, 2021 Year Amount October 1 through December 31, 2021 $ 424 2022 1,695 2023 1,702 2024 1,721 2025 1,728 2026 through 2101 152,980 Total lease payments 160,250 Less: imputed interest (136,576) Total $ 23,674 As of December 31, 2020 Year Amount 2021 $ 1,750 2022 1,750 2023 1,756 2024 1,776 2025 1,742 2026 through 2101 152,980 Total lease payments 161,754 Less: imputed interest (138,152) Total $ 23,602 Ground lease expense incurred by the Company amounted to succeed each officer, respectively. During the three and six months ended As of September 30, 2021 Year Amount October 1 through December 31, 2021 $ 28,827 2022 116,055 2023 114,353 2024 98,148 2025 93,719 2026 and thereafter 506,554 Total $ 957,656 As of December 31, 2020 Year Amount 2021 $ 117,228 2022 114,101 2023 108,406 2024 92,605 2025 88,309 2026 and thereafter 462,920 Total $ 983,569 Preferred Units to the full balance of In addition, as was the case under the Original Investment Agreement, VRLP. respective property including capital expenditures, management’s views of market and economic conditions, and considers items such as current and future rental rates, occupancies and market transactions for comparable properties. The estimated future redemption value of the Preferred Units is approximately During the six months ended June 30, 2022, 12,000 Series A Units were redeemed for cash at the stated value. Series A and Total A-1 Preferred Rockpoint Redeemable Units Interests Noncontrolling In MCRLP in RRT Interests Balance at July 1, 2021 $ 52,324 $ 464,648 $ 516,972 Redeemable Noncontrolling Interests Issued - - - Net 52,324 464,648 516,972 Income Attributed to Noncontrolling Interests 455 6,016 6,471 Distributions (455) (6,016) (6,471) Redemption Value Adjustment - 1,717 1,717 Balance at September 30, 2021 $ 52,324 $ 466,365 $ 518,689 Series A and Total A-1 Preferred Rockpoint Redeemable Units Interests Noncontrolling In MCRLP in RRT Interests Balance at July 1, 2020 $ 52,324 $ 456,631 $ 508,955 Redeemable Noncontrolling Interests Issued - - - Net 52,324 456,631 508,955 Income Attributed to Noncontrolling Interests 455 6,016 6,471 Distributions (455) (6,016) (6,471) Redemption Value Adjustment - 2,397 2,397 Balance at September 30, 2020 $ 52,324 $ 459,028 $ 511,352 Series A and Total A-1 Preferred Rockpoint Redeemable Units Interests Noncontrolling In MCRLP in RRT Interests Balance January 1, 2021 $ 52,324 $ 460,973 $ 513,297 Redeemable Noncontrolling Interests Issued - - - Net 52,324 460,973 513,297 Income Attributed to Noncontrolling Interests 1,365 18,048 19,413 Distributions (1,365) (18,048) (19,413) Redemption Value Adjustment - 5,392 5,392 Redeemable noncontrolling interests as of September 30, 2021 $ 52,324 $ 466,365 $ 518,689 Series A and Total A-1 Preferred Rockpoint Redeemable Units Interests Noncontrolling In MCRLP in RRT Interests Balance January 1, 2020 $ 52,324 $ 451,058 $ 503,382 Redeemable Noncontrolling Interests Issued - - - Net 52,324 451,058 503,382 Income Attributed to Noncontrolling Interests 1,365 18,048 19,413 Distributions (1,365) (18,048) (19,413) Redemption Value Adjustment - 7,970 7,970 Redeemable noncontrolling interests as of September 30, 2020 $ 52,324 $ 459,028 $ 511,352 The following table reflects the activity of the General Partner capital for the Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Opening Balance $ 1,335,226 $ 1,399,033 $ 1,398,817 $ 1,493,699 Net loss available to common shareholders (28,314) (42,208) (92,770) (117,019) Common stock distributions - (18,142) - (36,261) Redeemable noncontrolling interests (1,562) (2,167) (4,903) (7,207) Redemption of common units for common stock - - 2,716 - Shares issued under Dividend Reinvestment and Stock Purchase Plan 4 9 33 39 Directors' deferred compensation plan 91 76 229 215 Stock Compensation 1,632 394 3,517 1,158 Cancellation of common stock - - (118) - Other comprehensive income (loss) - - - 18 Rebalancing of ownership percent between parent and subsidiaries 948 (875) 504 1,478 Balance at September 30 $ 1,308,025 $ 1,336,120 $ 1,308,025 $ 1,336,120 Any transactions resulting in the issuance of additional common and preferred stock of the General Partner result in a corresponding issuance by the Operating Partnership of an equivalent amount of common and preferred units to the General Partner. PLAN the Chief Investment Officer as an employment “inducement award” that is intended to comply with New York Stock Exchange Rule 303A.08. Unit, on a per unit basis. June 30, 2021. The Company has issued restricted stock units and common stock (“Restricted Stock Awards”) to officers, certain other employees and non-employee members of the Board of Directors of the General Partner, which allow the holders to each receive a certain amount of shares of the General Partner’s common stock generally over a one-year to three-year vesting period. On June The 2021 RSU LTIP Awards are designed to align the interests of senior management to relative and absolute performance of the Company over a three year performance period. units are convertible into an equal number of shares of common stock upon the directors’ termination of service from the Board of Directors or a change in control of the Company, as defined in the plan. Three Months Ended Nine Months Ended September 30, September 30, Computation of Basic EPS 2021 2020 2021 2020 Loss from continuing operations $ (26,581) $ (75,296) $ (125,710) $ (147,999) Add (deduct): Noncontrolling interests in consolidated joint ventures 1,137 895 3,670 1,900 Add (deduct): Noncontrolling interests in Operating Partnership 2,884 7,769 12,858 15,859 Add (deduct): Redeemable noncontrolling interests (6,471) (6,471) (19,413) (19,413) Add (deduct): Redemption value adjustment of redeemable noncontrolling interests attributable to common shareholders (1,562) (2,167) (4,903) (7,207) Loss from continuing operations available to common shareholders (30,593) (75,270) (133,498) (156,860) Income (loss) from discontinued operations available to common shareholders 717 30,895 35,825 32,634 Net loss available to common shareholders for basic earnings per share $ (29,876) $ (44,375) $ (97,673) $ (124,226) Weighted average common shares 90,941 90,671 90,803 90,639 Basic EPS: Loss from continuing operations available to common shareholders $ (0.34) $ (0.83) $ (1.47) $ (1.73) Income (loss) from discontinued operations available to common shareholders 0.01 0.34 0.39 0.36 Net loss available to common shareholders $ (0.33) $ (0.49) $ (1.08) $ (1.37) Three Months Ended Nine Months Ended September 30, September 30, Computation of Diluted EPS 2021 2020 2021 2020 Net loss from continuing operations available to common shareholders $ (30,593) $ (75,270) $ (133,498) $ (156,860) Add (deduct): Noncontrolling interests in Operating Partnership (2,884) (7,769) (12,858) (15,859) Add (deduct): Redemption value adjustment of redeemable noncontrolling interests attributable to the Operating Partnership unitholders (155) (230) (489) (763) Loss from continuing operations for diluted earnings per share (33,632) (83,269) (146,845) (173,482) Income (loss) from discontinued operations for diluted earnings per share 789 34,178 39,408 36,103 Net loss available for diluted earnings per share $ (32,843) $ (49,091) $ (107,437) $ (137,379) Weighted average common shares 99,975 100,307 99,870 100,235 Diluted EPS: Loss from continuing operations available to common shareholders $ (0.34) $ (0.83) $ (1.47) $ (1.73) Income (loss) from discontinued operations available to common shareholders 0.01 0.34 0.39 0.36 Net loss available to common shareholders $ (0.33) $ (0.49) $ (1.08) $ (1.37) The following schedule reconciles the weighted average shares used in the basic EPS calculation to the shares used in the diluted EPS calculation (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Basic EPS shares 90,941 90,671 90,803 90,639 Add: Operating Partnership – common and vested LTIP units 9,034 9,636 9,067 9,596 Diluted EPS Shares 99,975 100,307 99,870 100,235 2021. Three Months Ended Nine Months Ended September 30, September 30, Computation of Basic EPU 2021 2020 2021 2020 Loss from continuing operations $ (26,581) $ (75,296) $ (125,710) $ (147,999) Add (deduct): Noncontrolling interests in consolidated joint ventures 1,137 895 3,670 1,900 Add (deduct): Redeemable noncontrolling interests (6,471) (6,471) (19,413) (19,413) Add (deduct): Redemption value adjustment of redeemable noncontrolling interests (1,717) (2,397) (5,392) (7,970) Loss from continuing operations available to unitholders (33,632) (83,269) (146,845) (173,482) Income (loss) from discontinued operations available to unitholders 789 34,178 39,408 36,103 Net loss available to common unitholders for basic earnings per unit $ (32,843) $ (49,091) $ (107,437) $ (137,379) Weighted average common units 99,975 100,307 99,870 100,235 Basic EPU: Loss from continuing operations available to unitholders $ (0.34) $ (0.83) $ (1.47) $ (1.73) Income (loss) from discontinued operations available to unitholders 0.01 0.34 0.39 0.36 Net loss available to common unitholders for basic earnings per unit $ (0.33) $ (0.49) $ (1.08) $ (1.37) Three Months Ended Nine Months Ended September 30, September 30, Computation of Diluted EPU 2021 2020 2021 2020 Net loss from continuing operations available to common unitholders $ (33,632) $ (83,269) $ (146,845) $ (173,482) Income (loss) from discontinued operations for diluted earnings per unit 789 34,178 39,408 36,103 Net loss available to common unitholders for diluted earnings per unit $ (32,843) $ (49,091) $ (107,437) $ (137,379) Weighted average common unit 99,975 100,307 99,870 100,235 Diluted EPU: Loss from continuing operations available to common unitholders $ (0.34) $ (0.83) $ (1.47) $ (1.73) Income (loss) from discontinued operations available to common unitholders 0.01 0.34 0.39 0.36 Net loss available to common unitholders $ (0.33) $ (0.49) $ (1.08) $ (1.37) The following schedule reconciles the weighted average units used in the basic EPU calculation to the units used in the diluted EPU calculation (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2020 2020 Basic EPU units 99,975 100,307 99,870 100,235 Diluted EPU Units 99,975 100,307 99,870 100,235 2021. September 30, September 30, 2021 2020 2021 2020 Opening Balance $ 175,107 $ 194,463 $ 193,563 $ 205,776 Net (loss) income 2,522 1,090 6,468 5,123 Unit distributions - (2,029) 643 (3,509) Redeemable noncontrolling interests (6,626) (6,701) (19,902) (20,176) Change in noncontrolling interests in consolidated joint ventures 12 - 197 133 Redemption of common units for common stock - - (2,716) - Redemption of common units (295) (29) (11,164) (2,170) Stock compensation 1,275 329 4,462 4,534 Cancellation of unvested LTIP units - - - (201) Other comprehensive income (loss) - - - (34) Rebalancing of ownership percentage between parent and subsidiaries (948) 875 (504) (1,478) Balance at September 30 $ 171,047 $ 187,998 $ 171,047 $ 187,998 Pursuant to ASC 810, Consolidation, on the accounting and reporting for noncontrolling interests and changes in ownership interests of a subsidiary, tax rules applicable to profits interests have allowed them to become equivalent in value to common units, LTIP Units may be converted on a one-for-one basis into common units. Common units in turn have a one-for-one relationship in value with shares of the General Partner’s common stock, and are redeemable on a one-for-one basis for cash or, at the election of the Company, shares of the General Partner’s common stock. Selected results of operations for the Commercial Multi-family Corporate Total & Other Real Estate Real Estate & Services (d) & Other (e) Company Total revenues: Three months ended: September 30, 2021 $ 38,978 $ 45,182 $ (416) $ 83,744 September 30, 2020 39,835 37,658 1,704 79,197 Nine months ended: September 30, 2021 119,690 122,778 (1,384) 241,084 September 30, 2020 117,239 118,739 1,021 236,999 Total operating and interest expenses (a): Three months ended: September 30, 2021 $ 15,252 $ 27,770 $ 27,948 $ 70,970 September 30, 2020 16,922 26,772 42,529 86,223 Nine months ended: September 30, 2021 47,679 80,835 83,676 212,190 September 30, 2020 55,171 71,689 101,668 228,528 Equity in earnings (loss) of unconsolidated joint ventures: Three months ended: September 30, 2021 $ 22 $ (1,746) $ - $ (1,724) September 30, 2020 493 880 - 1,373 Nine months ended: September 30, 2021 (111) (2,720) - (2,831) September 30, 2020 (1) (280) - (281) Net operating income (loss) (b): Three months ended: September 30, 2021 $ 23,748 $ 15,666 $ (28,364) $ 11,050 September 30, 2020 23,406 11,766 (40,825) (5,653) Nine months ended: September 30, 2021 71,900 39,223 (85,060) 26,063 September 30, 2020 62,067 46,770 (100,647) 8,190 Total assets: September 30, 2021 $ 1,237,667 $ 3,317,079 3,317,079 $ 12,421 $ 4,567,167 December 31, 2020 1,881,161 3,249,516 17,109 5,147,786 Total long-lived assets (c): September 30, 2021 $ 1,101,074 $ 3,112,054 $ (1,665) $ 4,211,463 December 31, 2020 1,693,054 3,035,485 (1,411) 4,727,128 Total investments in unconsolidated joint ventures: September 30, 2021 $ - $ 148,507 $ - $ 148,507 December 31, 2020 5,555 156,827 - 162,382 the Company’s consolidated hotel operations. Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Net operating income $ 11,050 $ (5,653) $ 26,063 $ 8,190 Add (deduct): Depreciation and amortization (29,344) (31,769) (86,410) (93,104) Land and other impairments, net (3,401) (1,292) (11,333) (23,401) Property impairments - (36,582) (6,041) (36,582) Realized gains (losses) and unrealized losses on disposition of rental property, net (3,000) - 521 (7,915) Gain on disposition of developable land - - 111 4,813 Gain on sale from unconsolidated joint ventures (1,886) - (1,886) - Loss from extinguishment of debt, net - - (46,735) - Loss from continuing operations (26,581) (75,296) (125,710) (147,999) Discontinued operations Income from discontinued operations 180 18,403 13,939 60,004 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net 609 15,775 25,469 (23,901) Total discontinued operations, net 789 34,178 39,408 36,103 Net loss (25,792) (41,118) (86,302) (111,896) Noncontrolling interests in consolidated joint ventures 1,137 895 3,670 1,900 Noncontrolling interests in Operating Partnership 2,884 7,769 12,858 15,859 Noncontrolling interest in discontinued operations (72) (3,283) (3,583) (3,469) Redeemable noncontrolling interests (6,471) (6,471) (19,413) (19,413) Net loss available to common shareholders $ (28,314) $ (42,208) $ (92,770) $ (117,019) Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Net operating income $ 11,050 $ (5,653) $ 26,063 $ 8,190 Add (deduct): Depreciation and amortization (29,344) (31,769) (86,410) (93,104) Land and other impairments, net (3,401) (1,292) (11,333) (23,401) Property impairments - (36,582) (6,041) (36,582) Realized gains (losses) and unrealized losses on disposition of rental property, net (3,000) - 521 (7,915) Gain on disposition of developable land - - 111 4,813 Gain on sale from unconsolidated joint ventures (1,886) - (1,886) - Loss from extinguishment of debt, net - - (46,735) - Loss from continuing operations (26,581) (75,296) (125,710) (147,999) Discontinued operations Income from discontinued operations 180 18,403 13,939 60,004 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net 609 15,775 25,469 (23,901) Total discontinued operations, net 789 34,178 39,408 36,103 Net loss (25,792) (41,118) (86,302) (111,896) Noncontrolling interests in consolidated joint ventures 1,137 895 3,670 1,900 Redeemable noncontrolling interests (6,471) (6,471) (19,413) (19,413) Net loss available to common unitholders $ (31,126) $ (46,694) $ (102,045) $ (129,409) ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF Columbia. Total In Service Property # of Development Date Property Location Type Apartment Units Costs Incurred 03/01/21 The Upton (a) Short Hills, NJ Multi-Family 193 $ 100,726 07/01/21 Riverhouse 9 (b) Weekawken, NJ Multi-Family 313 161,787 Totals 506 $ 262,513 Discontinued Operations: Realized Realized Gains Gains Rentable Net Net (Losses)/ (losses)/ Disposition # of Square Property Sales Carrying Unrealized Unrealized Date Property/Address Location Bldgs. Feet Type Proceeds Value Losses, net Losses, net 01/13/21 100 Overlook Center Princeton, New Jersey 1 149,600 Office $ 34,724 (a) $ 26,488 $ 8,236 03/25/21 Metropark portfolio (b) Edison and Iselin, New Jersey 4 926,656 Office 247,351 233,826 13,525 04/20/21 Short Hills portfolio (c) Short Hills, New Jersey 4 828,413 Office 248,664 245,800 2,864 06/11/21 Red Bank portfolio Red Bank, New Jersey 5 659,490 Office 80,730 78,364 2,366 06/30/21 Retail land leases Hanover and Parsippany, New Jersey - - Land Lease 41,957 37,951 $ 4,006 - 07/26/21 7 Giralda Farms Madison, New Jersey 1 236,674 Office 28,182 30,143 (1,961) Sub-total 15 2,800,833 681,608 652,572 4,006 25,030 Unrealized gains(losses) on real estate held for sale (3,485) 439 Totals 15 2,800,833 $ 681,608 $ 652,572 $ 521 $ 25,469 Critical Accounting Policies and Estimates Results From Operations Three Months Ended September 30, Dollar Percent (dollars in thousands) 2021 2020 Change Change Revenue from rental operations and other: Revenue from leases $ 72,243 $ 67,396 $ 4,847 7.2 % Parking income 3,950 4,033 (83) (2.1) Hotel income 3,018 893 2,125 238.0 Other income 1,905 3,999 (2,094) (52.4) Total revenues from rental operations 81,116 76,321 4,795 6.3 Property expenses: Real estate taxes 11,905 11,004 901 8.2 Utilities 3,573 3,598 (25) (0.7) Operating services 17,291 19,116 (1,825) (9.5) Total property expenses 32,769 33,718 (949) (2.8) Non-property revenues: Real estate services 2,628 2,876 (248) (8.6) Total non-property revenues 2,628 2,876 (248) (8.6) Non-property expenses: Real estate services expenses 3,307 3,299 8 0.2 General and administrative 11,292 26,361 (15,069) (57.2) Dead deal and transaction-related costs 3,671 2,583 1,088 42.1 Depreciation and amortization 29,344 31,769 (2,425) (7.6) Property impairments - 36,582 (36,582) (100.0) Land and other impairments, net 3,401 1,292 2,109 163.2 Total non-property expenses 51,015 101,886 (50,871) (49.9) Operating income (loss) (40) (56,407) 56,367 99.9 Other (expense) income: Interest expense (15,200) (20,265) 5,065 25.0 Interest and other investment income (loss) (4,731) 3 (4,734) (157,800.0) Equity in earnings (loss) of unconsolidated joint ventures (1,724) 1,373 (3,097) (225.6) Realized gains (losses) and unrealized losses on disposition of rental property, net (3,000) - (3,000) - Gain on disposition of developable land - - - - Gain on sale from unconsolidated joint ventures (1,886) - (1,886) - Loss from extinguishment of debt, net - - - - Total other (expense) income (26,541) (18,889) (7,652) (40.5) Loss from continuing operations (26,581) (75,296) 48,715 64.7 Discontinued operations: Income from discontinued operations 180 18,403 (18,223) (99.0) Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net 609 15,775 (15,166) (96.1) Total discontinued operations 789 34,178 (33,389) (97.7) Net loss $ (25,792) $ (41,118) $ 15,326 37.3 % The following is a summary of the changes in revenue from rental operations and other, and property expenses in Total Same-Store Acquired Properties Company Properties Properties Sold in 2020 and 2021 Dollar Percent Dollar Percent Dollar Percent Dollar Percent (dollars in thousands) Change Change Change Change Change Change Change Change Revenue from rental operations and other: Revenue from leases $ 4,847 7.2 % $ 2,719 4.1 % $ 3,061 4.5 % $ (933) (1.4) % Parking income (83) (2.1) (179) (4.4) 123 3.0 (27) (0.7) Hotel income 2,125 238.0 2,125 238.0 - - - - Other income (2,094) (52.4) (2,233) (55.9) 148 3.7 (9) (0.2) Total $ 4,795 6.3 % $ 2,432 3.2 % $ 3,332 4.4 % $ (969) (1.3) % Property expenses: Real estate taxes $ 901 8.2 % $ 976 8.9 % $ 231 2.1 % $ (306) (2.8) % Utilities (25) (0.7) (48) (1.4) 74 2.1 (51) (1.4) Operating services (1,825) (9.5) (2,060) (10.7) 555 2.9 (320) (1.7) Total $ (949) (2.8) % $ (1,132) (3.4) % $ 860 2.6 % $ (677) (2.0) % OTHER DATA: Number of Consolidated Properties 27 26 1 37 Commercial Square feet (in thousands) 4,916 4,916 - 5,506 Multi-family portfolio (number of units) 4,232 4,039 193 1,025 Depreciation and amortization. Depreciation and amortization decreased In 2022, the Company recognized losses of $0.1 million due to the repayment of a construction loan with a new mortgage loan at a multifamily property located in Weehawken, New Jersey. In 2021, the Company recognized losses from early extinguishment of debt of $46.7 million in 2021 which consists of $24.2 million in connection with the redemption of the Company's Senior Unsecured Notes, and defeasement of the mortgage loan with the sale of the Company's Short Hills office portfolio. 2021 Nine Months Ended September 30, Dollar Percent (dollars in thousands) 2021 2020 Change Change Revenue from rental operations and other: Revenues from leases $ 206,950 $ 205,732 $ 1,218 0.6 % Parking income 10,520 12,332 (1,812) (14.7) Hotel income 6,785 3,290 3,495 106.2 Other income 9,081 7,021 2,060 29.3 Total revenues from rental operations 233,336 228,375 4,961 2.2 Property expenses: Real estate taxes 35,958 32,920 3,038 9.2 Utilities 10,816 10,564 252 2.4 Operating services 51,831 51,179 652 1.3 Total property expenses 98,605 94,663 3,942 4.2 Non-property revenues: Real estate services 7,748 8,624 (876) (10.2) Total non-property revenues 7,748 8,624 (876) (10.2) Non-property expenses: Real estate services expenses 9,838 10,107 (269) (2.7) General and administrative 43,347 59,423 (16,076) (27.1) Dead deal and transaction-related costs 6,416 2,583 3,833 148.4 Depreciation and amortization 86,410 93,104 (6,694) (7.2) Property impairments 6,041 36,582 (30,541) (83.5) Land and other impairments, net 11,333 23,401 (12,068) (51.6) Total non-property expenses 163,385 225,200 (61,815) (27.4) Operating income (20,906) (82,864) 61,958 74.8 Other (expense) income: Interest expense (49,364) (61,794) 12,430 20.1 Interest and other investment income (4,620) 42 (4,662) (11,100.0) Equity in earnings (loss) of unconsolidated joint ventures (2,831) (281) (2,550) (907.5) Realized gains (losses) and unrealized losses on disposition of rental property, net 521 (7,915) 8,436 106.6 Gain on disposition of developable land 111 4,813 (4,702) (97.7) Gain on sale from unconsolidated joint ventures (1,886) - (1,886) - Loss from extinguishment of debt, net (46,735) - (46,735) - Total other (expense) income (104,804) (65,135) (39,669) (60.9) Loss from continuing operations (125,710) (147,999) 22,289 15.1 Discontinued operations: Income from discontinued operations 13,939 60,004 (46,065) (76.8) Realized gains (losses) and unrealized losses on disposition of rental property and impairments, net 25,469 (23,901) 49,370 206.6 Total discontinued operations, net 39,408 36,103 3,305 9.2 Net loss $ (86,302) $ (111,896) $ 25,594 22.9 % The following is a summary of the changes in revenue from rental operations and other, and property expenses in Total Same-Store Acquired Properties Company Properties Properties Sold in 2020 and 2021 Dollar Percent Dollar Percent Dollar Percent Dollar Percent (dollars in thousands) Change Change Change Change Change Change Change Change Revenue from rental operations and other: Revenue from leases $ 1,218 0.6 % $ (4,404) (2.1) % $ 8,276 4.0 % $ (2,654) (1.3) % Parking income (1,812) (14.7) (2,072) (16.8) 344 2.8 (84) (0.7) Hotel Income 3,495 106.2 3,495 106.2 - - - - Other income 2,060 29.3 1,794 25.6 330 4.7 (63) (0.9) Total $ 4,961 2.2 % $ (1,187) (0.5) % $ 8,950 3.9 % $ (2,801) (1.2) % Property expenses: Real estate taxes $ 3,038 9.2 % $ 2,274 6.9 % $ 959 2.9 % $ (195) (0.6) % Utilities 252 2.4 133 1.2 333 3.2 (214) (2.0) Operating services 652 1.3 29 0.1 1,331 2.6 (708) (1.4) Total $ 3,942 4.2 % $ 2,436 2.6 % $ 2,623 2.8 % $ (1,117) (1.2) % OTHER DATA: Number of Consolidated Properties 27 24 3 37 Commercial Square feet (in thousands) 4,916 4,885 31 5,506 Multi-family portfolio (number of units) 4,232 3,713 519 1,025 General and administrative. General and administrative Net On September 30, 2020, the Company announced that its Board of Directors was suspending its common dividends and distributions attributable to the third and fourth quarters 2020. As the Company’s management estimated that as of September 2020 it had satisfied its the year with no dividends paid. The Company anticipates its regular quarterly common dividend to remain suspended in 2022 while it seeks to conclude its transition into a pureplay multifamily REIT. 2022: Balance Weighted Average Weighted Average ($000’s) % of Total Interest Rate (a) Maturity in Years Fixed Rate Secured Debt (b) $ 1,686,595 70.67 % 3.72 % 5.49 Variable Rate Secured Debt 700,068 29.33 % 3.36 % 2.64 Totals/Weighted Average: $ 2,386,663 100.00 % 3.61 % (b) 4.65 Adjustment for unamortized debt discount - Unamortized deferred financing costs (11,716) Total Debt, Net $ 2,374,947 Scheduled Principal Weighted Avg. Amortization Maturities Total Effective Interest Rate of Period ($000’s) ($000’s) ($000’s) Future Repayments (a) 2021 $ 184 $ 3,800 $ 3,984 4.57 % 2022 550 168,609 169,159 2.91 % 2023 2,047 116,169 118,216 2.93 % 2024 3,403 719,288 722,691 3.71 % 2025 3,300 - 3,300 3.98 % 2026 12,822 658,000 670,822 3.67 % Thereafter - 698,491 698,491 3.73 % Sub-total 22,306 2,364,357 2,386,663 3.61 % Unamortized deferred financing costs (11,716) - (11,716) - Totals/Weighted Average $ 10,590 $ 2,364,357 $ 2,374,947 - % (b) (b)Excludes amortized deferred financing costs primarily pertaining to the Company’s revolving credit facility which amounted to Revolving Credit Facility and Term Loans Interest Rate - Applicable Interest Rate - Basis Points Applicable Above LIBOR for Basis Points Alternate Base Facility Fee Total Leverage Ratio Above LIBOR Rate Loans Basis Points <45% 125.0 25.0 20.0 ≥45% and <50% 130.0 30.0 25.0 ≥50% and <55% (ratio through May 6, 2021) 135.0 35.0 30.0 ≥55% 160.0 60.0 35.0 Mortgages, Loans Payable and Other Obligations Dividend Reinvestment and Stock Purchase Plan 2022. 2022. Payments Due by Period Less than 1 2 – 3 4 – 5 6 – 10 After 10 (dollars in thousands) Total Year Years Years Years Years Revolving credit facility and term loans $ 186,924 $ 5,003 $ 181,921 $ - $ - $ - Mortgages, loans payable and other obligations (a) 2,586,521 70,938 465,502 (b) 971,950 (c) 1,016,236 61,895 Payments in lieu of taxes (PILOT) 4,233 3,594 639 - - - Ground lease payments/other 160,317 1,762 3,416 3,455 8,793 142,891 Total $ 2,937,995 $ 81,297 $ 651,478 $ 975,405 $ 1,025,029 $ 204,786 Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Net loss available to common shareholders $ (28,314) $ (42,208) $ (92,770) $ (117,019) Add (deduct): Noncontrolling interests in Operating Partnership (2,884) (7,769) (12,858) (15,859) Noncontrolling interests in discontinued operations 72 3,283 3,583 3,469 Real estate-related depreciation and amortization on continuing operations (a) 31,624 34,764 92,842 101,856 Real estate-related depreciation and amortization on discontinued operations 53 1,267 965 3,974 Property impairments on continuing operations - 36,582 - 36,582 Property impairments on discontinued operations - - 6,041 - Impairment of unconsolidated joint venture investment - - (2) - Gain on sale from unconsolidated joint ventures 1,886 - 1,886 - Continuing operations: Realized (gains) losses and unrealized (gains) losses on disposition of rental property, net 3,000 - (521) 7,915 Discontinued operations: Realized (gains) losses and unrealized (gains) losses on disposition of rental property, net (609) (15,775) (25,469) 23,901 Funds from operations available to common stock and Operating Partnership unitholders (b) $ 4,828 $ 10,144 $ (26,303) $ 44,819 Item 3. Quantitative And Qualitative Disclosures About Market Risk September 30, 2021 Debt, including current portion 10/1/21 - Fair ($s in thousands) 12/31/21 2022 2023 2024 2025 2026 Thereafter Sub-total Other (a) Total Value Fixed Rate $ 3,984 $ 550 $ 61,045 $ 311,403 $ 3,300 $ 607,822 $ 698,491 $ 1,686,595 $ (7,696) $ 1,678,899 $ 1,703,583 Average Interest Rate 4.57 % 4.85 % 3.59 % 3.43 % 3.98 % 3.85 % 3.73 % 3.72 % 0 Variable Rate $ - $ 168,609 $ 57,171 $ 411,288 $ - $ 63,000 $ - $ 700,068 $ (4,020) $ 696,048 $ 696,048 including its ability to pay its debt obligations. Exhibit Exhibit Title 31.1* 31.2* 31.3* 31.4* 32.1* 32.2* 101.1* The following financial statements from 104.1* The cover page from this Quarterly Report on Form 10-Q, formatted in Inline XBRL. Date: By: /s/ Mahbod Nia Date: August 3, 2022 By: Chief Financial Officer Date: By: /s/ Mahbod Nia Date: August 3, 2022 By: Chief Financial OfficerSecurities Registered Pursuant to Section 12(b) of the Act:
Mack-Cali Realty Corporation:Title of each classTrading Symbol(s)Name of each exchange on which registeredCommon Stock, par value $0.01 per shareCLI New York Stock Exchange Mack-Cali Realty, L.P.:
NoneTitle of each class Trading Symbol(s) Name of each exchange on which registered Common Stock, par value $0.01 per share VRE New York Stock Exchange Mack-Cali Realty CorporationVeris Residential, Inc.YESYes NONo Mack-Cali Realty,Veris Residential, L.P.YESYes NONo Mack-Cali Realty CorporationVeris Residential, Inc.YESYes NONo Mack-Cali Realty,Veris Residential, L.P.YESYes NONo or a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”filer,” “smaller reporting company” and “smaller reporting“emerging growth company” in Rule 12b-2 of the Exchange Act.Mack-Cali Realty Corporation:oooo Mack-Cali Realty,ooooMack-Cali Realty Corporation Veris Residential, Inc.Mack-Cali Realty, L.P. Mack-Cali Realty CorporationVeris Residential, Inc.YESYes NONo Mack-Cali Realty,Veris Residential, L.P.YESYes NONo NovemberAugust 1, 2021,2022, there were 90,946,25891,079,861 shares of Mack-Cali Realty Corporation’sVeris Residential, Inc.’s Common Stock, par value $0.01 per share, outstanding.Mack-Cali Realty,SeptemberJune 30, 20212022 of Mack-Cali Realty CorporationVeris Residential, Inc. and Mack-Cali Realty,Veris Residential, L.P. Unless stated otherwise or the context otherwise requires, references to the “Operating Partnership” mean Mack-Cali Realty,Veris Residential, L.P., a Delaware limited partnership, and references to the “General Partner” mean Mack-Cali Realty Corporation,Veris Residential, Inc., a Maryland corporation and real estate investment trust (“REIT”), and its subsidiaries, including the Operating Partnership. References to the “Company,” “we,” “us” and “our” mean collectively the General Partner, the Operating Partnership and those entities/subsidiaries consolidated by the General Partner. management, acquisition, development construction and tenant-related services for its General Partner. The Operating Partnership, through its operating divisions and subsidiaries, including the Mack-CaliVeris property-owning partnerships and limited liability companies is the entity through which all of the General Partner’s operations are conducted. The General Partner is the sole general partner of the Operating Partnership and has exclusive control of the Operating Partnership’s day-to-day management.SeptemberJune 30, 2021,2022, the General Partner owned an approximate 91.090.7 percent common unit interest in the Operating Partnership. The remaining approximate 9.09.3 percent common unit interest is owned by limited partners. The limited partners of the Operating Partnership are (1) persons who contributed their interests in properties to the Operating Partnership in exchange for common units (each, a “Common Unit”) or preferred units of limited partnership interest in the Operating Partnership or (2) recipients of long term incentive plan units of the Operating Partnership pursuant to the General Partner’s executive compensation plans.•enhance investors’ understanding of the General Partner and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business of the Company;•eliminate duplicative disclosure and provide a more streamlined and readable presentation because a substantial portion of the disclosure applies to both the General Partner and the Operating Partnership; and•create time and cost efficiencies through the preparation of one combined report instead of two separate reports.other significant assets, liabilities or operations, other than its interests in the Operating Partnership, nor does the Operating Partnership have employees of its own. The Operating Partnership, not the General Partner, generally executes alland term loan facilities, the issuance of secured and unsecured debt and equity securities, and proceeds received from the disposition of properties and joint ventures.•Item 1. Financial Statements (unaudited), which includes the following specific disclosures for Mack-Cali Realty CorporationVeris Residential, Inc. and Mack-Cali Realty,Veris Residential, L.P.:•Note 2. Significant Accounting Policies, where applicable;•Note 14. Redeemable Noncontrolling Interests;Redeemable Noncontrolling Interests;Note 16. Mack-Cali Realty Corporation’sVeris Residential, Inc.’s Stockholders’ Equity and Mack-Cali Realty,Veris Residential, L.P.’s Partners’ Capital;•Note 17.16. Noncontrolling Interests in Subsidiaries; and•Note 18.17. Segment Reporting, where applicable.•Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations includes information specific to each entity, where applicable.MACK-CALI REALTY CORPORATIONMACK-CALI REALTY,VERIS RESIDENTIAL, INC.Mack-Cali Realty CorporationVeris Residential, Inc.8149151117Mack-Cali Realty,Veris Residential, Inc. and Veris Residential, L.P.12131415Consolidated Statements of Cash Flows for the nine months ended September 30, 2021 and 202017Mack-Cali Realty Corporation and Mack-Cali Realty, L.P.535272677268Mack-Cali Realty CorporationVeris Residential, Inc. and Mack-Cali Realty,Veris Residential, L.P.737073707370737073707370737074Signatures81MACK-CALI REALTY CORPORATIONMACK-CALI REALTY,VERIS RESIDENTIAL, INC.Mack-Cali Realty Corporation’sVeris Residential, Inc.’s and Mack-Cali Realty,Veris Residential, L.P.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020.nine-month periodsix month periods ended SeptemberJune 30, 20212022 are not necessarily indicative of the results to be expected for the entire fiscal year or any other period.
MACK-CALI REALTY CORPORATIONVERIS RESIDENTIAL, INC. AND SUBSIDIARIESASSETS June 30,
2022December 31,
2021Rental property Land and leasehold interests $ 499,042 $ 494,935 Buildings and improvements 3,392,977 3,375,266 Tenant improvements 108,895 106,654 Furniture, fixtures and equipment 117,543 100,011 4,118,457 4,076,866 Less – accumulated depreciation and amortization (620,414) (583,416) 3,498,043 3,493,450 Real estate held for sale, net 368,625 618,646 Net investment in rental property 3,866,668 4,112,096 Cash and cash equivalents 29,073 31,754 Restricted cash 24,356 19,701 Investments in unconsolidated joint ventures 132,790 137,772 Unbilled rents receivable, net 51,500 72,285 Deferred charges and other assets, net 203,467 151,347 Accounts receivable 3,143 2,363 Total assets $ 4,310,997 $ 4,527,318 LIABILITIES AND EQUITY Revolving credit facility and term loans $ 76,000 $ 148,000 Mortgages, loans payable and other obligations, net 2,151,489 2,241,070 Dividends and distributions payable 111 384 Accounts payable, accrued expenses and other liabilities 69,220 134,977 Rents received in advance and security deposits 25,422 26,396 Accrued interest payable 5,257 5,760 Total liabilities 2,327,499 2,556,587 Commitments and contingencies 0 0 Redeemable noncontrolling interests 516,325 521,313 Equity: Veris Residential, Inc. stockholders’ equity: Common stock, $0.01 par value, 190,000,000 shares authorized, 91,062,532 and 90,948,008 shares outstanding 911 909 Additional paid-in capital 2,525,466 2,530,383 Dividends in excess of net earnings (1,232,038) (1,249,319) Accumulated other comprehensive income (loss) 1,941 9 Total Veris Residential, Inc. stockholders’ equity 1,296,280 1,281,982 Noncontrolling interests in subsidiaries: Operating Partnership 132,250 127,053 Consolidated joint ventures 38,643 40,383 Total noncontrolling interests in subsidiaries 170,893 167,436 Total equity 1,467,173 1,449,418 Total liabilities and equity $ 4,310,997 $ 4,527,318
MACK-CALI REALTY CORPORATIONVERIS RESIDENTIAL, INC. AND SUBSIDIARIES
The accompanying notes are an integral part of these consolidated financial statements.Three Months Ended
June 30,Six Months Ended
June 30,REVENUES 2022 2021 2022 2021 Revenue from leases $ 68,490 $ 67,376 $ 132,832 $ 131,587 Real estate services 897 2,593 1,807 5,119 Parking income 4,754 3,484 8,931 6,570 Hotel income 4,536 2,714 5,953 3,767 Other income 1,149 3,520 27,936 7,177 Total revenues 79,826 79,687 177,459 154,220 EXPENSES Real estate taxes 12,032 12,010 24,532 23,629 Utilities 3,477 3,151 7,410 7,243 Operating services 18,706 18,943 37,106 34,265 Real estate services expenses 2,920 3,213 5,283 6,531 General and administrative 11,582 18,066 31,056 32,052 Transaction related costs 1,345 2,745 1,345 2,745 Depreciation and amortization 27,733 28,498 53,851 56,276 Property impairments — 6,041 — 6,041 Land and other impairments, net 3,900 7,519 6,832 7,932 Total expenses 81,695 100,186 167,415 176,714 OTHER (EXPENSE) INCOME Interest expense (17,707) (16,554) (32,733) (34,164) Interest and other investment income (loss) 189 95 347 112 Equity in earnings (loss) of unconsolidated joint ventures 2,638 349 2,151 (1,107) Realized gains (losses) and unrealized gains (losses) on disposition of rental property, net — 3,521 1,836 3,521 Gain on disposition of developable land 55,125 111 57,748 111 Gain (loss) from extinguishment of debt, net (129) (46,735) (6,418) (46,735) Total other income (expense) 40,116 (59,213) 22,931 (78,262) Income (loss) from continuing operations 38,247 (79,712) 32,975 (100,756) Discontinued operations: Income from discontinued operations 843 3,601 1,588 15,385 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net (4,440) 2,080 (4,440) 24,861 Total discontinued operations, net (3,597) 5,681 (2,852) 40,246 Net income (loss) 34,650 (74,031) 30,123 (60,510) Noncontrolling interests in consolidated joint ventures 784 1,198 1,758 2,533 Noncontrolling interests in Operating Partnership of income from continuing operations (3,029) 7,742 (2,064) 10,122 Noncontrolling interests in Operating Partnership in discontinued operations 334 (517) 267 (3,659) Redeemable noncontrolling interests (6,366) (6,471) (12,803) (12,942) Net income (loss) available to common shareholders $ 26,373 $ (72,079) $ 17,281 $ (64,456) Basic earnings per common share: Income (loss) from continuing operations $ 0.29 $ (0.87) $ 0.15 $ (1.15) Discontinued operations (0.04) 0.06 (0.03) 0.40 Net income (loss) available to common shareholders $ 0.25 $ (0.81) $ 0.12 $ (0.75) Diluted earnings per common share: Income (loss) from continuing operations $ 0.29 $ (0.87) $ 0.15 $ (1.15) Discontinued operations (0.04) 0.06 (0.03) 0.40 Net income (loss) available to common shareholders $ 0.25 $ (0.81) $ 0.12 $ (0.75) Basic weighted average shares outstanding 91,027 90,774 90,989 90,733 Diluted weighted average shares outstanding 100,352 99,873 100,171 99,817 MACK-CALI REALTY CORPORATIONVERIS RESIDENTIAL, INC. AND SUBSIDIARIES(in (in thousands) (unaudited)Three Months Ended
June 30,Six Months Ended
June 30,2022 2021 2022 2021 Net income (loss) $ 34,650 $ (74,031) $ 30,123 $ (60,510) Other comprehensive income (loss): Net unrealized gain (loss) on derivative instruments for interest rate swaps (60) — 2,122 $ — Comprehensive (income) loss $ 34,590 $ (74,031) $ 32,245 $ (60,510) Comprehensive (income) loss attributable to noncontrolling interests in consolidated joint ventures 784 1,198 1,758 2,533 Comprehensive (income) loss attributable to redeemable noncontrolling interests (6,366) (6,471) (12,803) (12,942) Comprehensive (income) loss attributable to noncontrolling interests in Operating Partnership (2,689) 7,225 (1,987) 6,463 Comprehensive income (loss) attributable to common shareholders $ 26,319 $ (72,079) $ 19,213 $ (64,456)
MACK-CALI REALTY CORPORATIONVERIS RESIDENTIAL, INC. AND SUBSIDIARIES(in (in thousands) (unaudited) Common Stock Additional
Paid-In
CapitalDividends in
Excess of
Net EarningsAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interests
in SubsidiariesTotal Equity For the Three Months Ended June 30, 2022 Shares Par Value Balance at April 1, 2022 90,956 909 $ 2,531,188 $ (1,258,411) $ 1,995 $ 165,120 $ 1,440,801 Net income (loss) — — — 26,373 — 8,277 34,650 Common unit distributions — — — — — — — Redeemable noncontrolling interests — — (3,524) — — (6,726) (10,250) Change in noncontrolling interests in consolidated joint ventures — — — — — 7 7 Redemption of common units for common stock 11 — 161 — — (161) — Redemption of common units — — — — — (359) (359) Shares issued under Dividend Reinvestment and Stock Purchase Plan 1 — 16 — — — 16 Directors' deferred compensation plan — — 110 — — — 110 Stock compensation 136 2 2,507 — — 445 2,954 Cancellation of restricted shares (41) — (696) — — — (696) Other comprehensive income — — — — (54) (6) (60) Rebalancing of ownership percentage between parent and subsidiaries — — (4,296) — — 4,296 — Balance at June 30, 2022 91,063 911 $ 2,525,466 $ (1,232,038) $ 1,941 $ 170,893 $ 1,467,173 Common Stock Additional
Paid-In
CapitalDividends in
Excess of
Net EarningsAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interests
in SubsidiariesTotal Equity For the Three Months Ended June 30, 2021 Shares Par Value Balance at April 1, 2021 90,729 907 $ 2,528,570 $ (1,122,654) $ — $ 182,693 $ 1,589,516 Net income (loss) — — — (72,079) — (1,952) (74,031) Common unit distributions — — — — — 639 639 Redeemable noncontrolling interests — — (1,550) — — (6,626) (8,176) Change in noncontrolling interests in consolidated joint ventures — — — — — 175 175 Redemption of common units for common stock 175 2 2,714 — — (2,716) — Redemption of common units — — — — — (410) (410) Shares issued under Dividend Reinvestment and Stock Purchase Plan 1 — 11 — — — 11 Directors' deferred compensation plan — — 66 — — — 66 Stock compensation 42 — 1,239 — — 1,304 2,543 Rebalancing of ownership percentage between parent and subsidiaries — — (2,000) — — 2,000 — Balance at June 30, 2021 90,947 909 $ 2,529,050 $ (1,194,733) $ — $ 175,107 $ 1,510,333 MACK-CALI REALTY CORPORATIONVERIS RESIDENTIAL, INC. AND SUBSIDIARIES(in (in thousands) (unaudited)Common Stock Additional
Paid-In
CapitalDividends in
Excess of
Net EarningsAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interests
in SubsidiariesTotal Equity For the Six Months Ended June 30, 2022 Shares Par Value Balance at January 1, 2022 90,948 909 $ 2,530,383 $ (1,249,319) $ 9 $ 167,436 $ 1,449,418 Net income (loss) — — — 17,281 — 12,842 30,123 Common unit distributions — — — — — 218 218 Redeemable noncontrolling interests — — (6,466) — — (13,454) (19,920) Change in noncontrolling interests in consolidated joint ventures — — — — — 18 18 Redemption of common units for common stock 11 — 161 — — (161) — Redemption of common units — — — — — (1,801) (1,801) Shares issued under Dividend Reinvestment and Stock Purchase Plan 2 — 27 — — — 27 Directors' deferred compensation plan — — 220 — — — 220 Stock compensation 143 2 4,464 — — 2,978 7,444 Cancellation of restricted shares (41) — (696) — — — (696) Other comprehensive income — — — — 1,932 190 2,122 Rebalancing of ownership percentage between parent and subsidiaries — — (2,627) — — 2,627 — Balance at June 30, 2022 91,063 911 $ 2,525,466 $ (1,232,038) $ 1,941 $ 170,893 $ 1,467,173 Common Stock Additional
Paid-In
CapitalDividends in
Excess of
Net EarningsAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interests
in SubsidiariesTotal Equity For the Six Months Ended June 30, 2021 Shares Par Value Balance at January 1, 2021 90,712 907 $ 2,528,187 $ (1,130,277) $ — $ 193,563 $ 1,592,380 Net income (loss) — — — (64,456) — 3,946 (60,510) Common unit distributions — — — — — 643 643 Redeemable noncontrolling interests — — (3,341) — — (13,276) (16,617) Change in noncontrolling interests in consolidated joint ventures — — — — — 185 185 Redemption of common units for common stock 175 2 2,714 — — (2,716) — Redemption of common units — — — — — (10,869) (10,869) Shares issued under Dividend Reinvestment and Stock Purchase Plan 2 — 29 — — — 29 Directors' deferred compensation plan — — 138 — — — 138 Stock compensation 58 — 1,885 — — 3,187 5,072 Cancellation of restricted shares — — (118) — — — (118) Rebalancing of ownership percentage between parent and subsidiaries — — (444) — — 444 — Balance at June 30, 2021 90,947 909 $ 2,529,050 $ (1,194,733) $ — $ 175,107 $ 1,510,333 MACK-CALI REALTY CORPORATIONVERIS RESIDENTIAL, INC. AND SUBSIDIARIES(in(in thousands) (unaudited)Six Months Ended June 30, CASH FLOWS FROM OPERATING ACTIVITIES 2022 2021 Net income (loss) Net income (loss) $ 30,123 $ (60,510) Net (income) loss from discontinued operations Net (income) loss from discontinued operations 2,852 (40,246) Net income (loss) from continuing operations Net income (loss) from continuing operations 32,975 (100,756) Adjustments to reconcile net income (loss) to net cash provided by Operating activities: Depreciation and amortization, including related intangible assets 53,772 54,578 Amortization of directors deferred compensation stock units 220 138 Amortization of stock compensation 7,444 5,072 Amortization of deferred financing costs 2,358 2,190 Amortization of debt discount and mark-to-market — 232 Equity in (earnings) loss of unconsolidated joint ventures (2,151) 1,107 Distributions of cumulative earnings from unconsolidated joint ventures 13 117 Realized (gains) losses and unrealized (gains) losses on disposition of rental property, net (1,836) (3,521) (Gain) on disposition of developable land (Gain) on disposition of developable land (57,748) (111) Property impairments Property impairments — 6,041 Land and other impairments, net 6,832 7,932 (Gain) Loss from extinguishment of debt (Gain) Loss from extinguishment of debt 6,418 46,735 Changes in operating assets and liabilities: Decrease (increase) in unbilled rents receivable, net Decrease (increase) in unbilled rents receivable, net 5,832 (3,524) (Increase) decrease in deferred charges and other assets (Increase) decrease in deferred charges and other assets (6,679) 813 Decrease in accounts receivable, net Decrease in accounts receivable, net (792) 4,242 Increase (decrease) in accounts payable, accrued expenses and other liabilities (1,412) (3,376) (Decrease) increase in rents received in advance and security deposits (Decrease) increase in rents received in advance and security deposits (969) 784 (Decrease) increase in accrued interest payable (Decrease) increase in accrued interest payable (503) 273 Net cash flows provided by operating activities - continuing operations 43,774 18,966 Net cash flows (used in) provided by operating activities - discontinued operations Net cash flows (used in) provided by operating activities - discontinued operations 1,936 8,981 Net cash provided by operating activities $ 45,710 $ 27,947 CASH FLOWS FROM INVESTING ACTIVITIES Rental property acquisitions and related intangibles $ (5,192) $ — Rental property additions, improvements and other costs Rental property additions, improvements and other costs (26,724) (32,077) Development of rental property and other related costs (58,610) (120,023) Proceeds from the sales of rental property 236,864 42,702 Proceeds from sale of investments in joint ventures Proceeds from sale of investments in joint ventures — 1,975 Repayment of notes receivable 1,433 381 Investment in unconsolidated joint ventures (147) (398) Distributions in excess of cumulative earnings from unconsolidated joint ventures 7,450 4,949 Net cash provided by (used in) investing activities - continuing operations Net cash provided by (used in) investing activities - continuing operations 155,074 (102,491) Net cash provided by investing activities - discontinued operations — 592,590 Net cash provided by investing activities Net cash provided by investing activities $ 155,074 $ 490,099 CASH FLOW FROM FINANCING ACTIVITIES Borrowings from revolving credit facility $ 43,000 $ 170,000 Repayment of revolving credit facility (115,000) (33,000) Borrowings from term loans — 150,000 Repayments of term loans — (123,000) Repayments of unsecured term loans Repayments of unsecured term loans — (573,727) Proceeds from mortgages and loans payable 149,068 93,772 Repayment of mortgages, loans payable and other obligations (240,270) (129,770) Redemption of redeemable noncontrolling interests, net Redemption of redeemable noncontrolling interests, net (12,000) — Payment of early debt extinguishment costs (5,140) (49,874) Common unit redemptions (2,497) (410) Payment of financing costs (3,025) (7,339) Contribution from noncontrolling interests Contribution from noncontrolling interests 18 185 Distributions to redeemable noncontrolling interests (12,908) (12,942) Payment of common dividends and distributions (56) (468) Net cash (used in) provided by financing activities $ (198,810) $ (516,573) Net (decrease) increase in cash and cash equivalents Net (decrease) increase in cash and cash equivalents $ 1,974 $ 1,473 Cash, cash equivalents and restricted cash, beginning of period (1) 51,455 52,302 Cash, cash equivalents and restricted cash, end of period (2) $ 53,429 $ 53,775 $14,207$19,701 and $15,577$14,207 as of December 31, 2021 and 2020, and 2019, respectively.$19,809$24,356 and $14,507$16,147 as of SeptemberJune 30, 2022 and 2021, and 2020, respectively.
MACK-CALI REALTY,VERIS RESIDENTIAL, L.P. AND SUBSIDIARIESASSETS June 30,
2022December 31,
2021Rental property Land and leasehold interests $ 499,042 $ 494,935 Buildings and improvements 3,392,977 3,375,266 Tenant improvements 108,895 106,654 Furniture, fixtures and equipment 117,543 100,011 4,118,457 4,076,866 Less – accumulated depreciation and amortization (620,414) (583,416) 3,498,043 3,493,450 Real estate held for sale, net 368,625 618,646 Net investment in rental property 3,866,668 4,112,096 Cash and cash equivalents 29,073 31,754 Restricted cash 24,356 19,701 Investments in unconsolidated joint ventures 132,790 137,772 Unbilled rents receivable, net 51,500 72,285 Deferred charges and other assets, net 203,467 151,347 Accounts receivable 3,143 2,363 Total assets $ 4,310,997 $ 4,527,318 LIABILITIES AND EQUITY Revolving credit facility and term loans $ 76,000 $ 148,000 Mortgages, loans payable and other obligations, net 2,151,489 2,241,070 Distributions payable 111 384 Accounts payable, accrued expenses and other liabilities 69,220 134,977 Rents received in advance and security deposits 25,422 26,396 Accrued interest payable 5,257 5,760 Total liabilities 2,327,499 2,556,587 Commitments and contingencies 0 0 Redeemable noncontrolling interests 516,325 521,313 Partners’ Capital: General Partner, 91,062,532 and 90,948,008 common units outstanding 1,226,783 1,211,790 Limited partners, 9,290,469 and 9,013,534 common units/LTIPs outstanding 199,806 197,236 Accumulated other comprehensive income (loss) 1,941 9 Total Veris Residential, L.P. partners’ capital 1,428,530 1,409,035 Noncontrolling interests in consolidated joint ventures 38,643 40,383 Total equity 1,467,173 1,449,418 Total liabilities and equity $ 4,310,997 $ 4,527,318
The accompanying notes are an integral part of these consolidated financial statements.Three Months Ended
June 30,Six Months Ended
June 30,REVENUES 2022 2021 2022 2021 Revenue from leases $ 68,490 $ 67,376 $ 132,832 $ 131,587 Real estate services 897 2,593 1,807 5,119 Parking income 4,754 3,484 8,931 6,570 Hotel income 4,536 2,714 5,953 3,767 Other income 1,149 3,520 27,936 7,177 Total revenues 79,826 79,687 177,459 154,220 EXPENSES Real estate taxes 12,032 12,010 24,532 23,629 Utilities 3,477 3,151 7,410 7,243 Operating services 18,706 18,943 37,106 34,265 Real estate services expenses 2,920 3,213 5,283 6,531 General and administrative 11,582 18,066 31,056 32,052 Transaction related costs 1,345 2,745 1,345 2,745 Depreciation and amortization 27,733 28,498 53,851 56,276 Property impairments — 6,041 — 6,041 Land and other impairments, net 3,900 7,519 6,832 7,932 Total expenses 81,695 100,186 167,415 176,714 OTHER (EXPENSE) INCOME Interest expense (17,707) (16,554) (32,733) (34,164) Interest and other investment income (loss) 189 95 347 112 Equity in earnings (loss) of unconsolidated joint ventures 2,638 349 2,151 (1,107) Realized gains (losses) and unrealized gains (losses) on disposition of rental property, net — 3,521 1,836 3,521 Gain on disposition of developable land 55,125 111 57,748 111 Gain (loss) from extinguishment of debt, net (129) (46,735) (6,418) (46,735) Total other income (expense) 40,116 (59,213) 22,931 (78,262) Income (loss) from continuing operations 38,247 (79,712) 32,975 (100,756) Discontinued operations: Income from discontinued operations 843 3,601 1,588 15,385 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net (4,440) 2,080 (4,440) 24,861 Total discontinued operations, net (3,597) 5,681 (2,852) 40,246 Net income (loss) 34,650 (74,031) 30,123 (60,510) Noncontrolling interests in consolidated joint ventures 784 1,198 1,758 2,533 Redeemable noncontrolling interests (6,366) (6,471) (12,803) (12,942) Net income (loss) available to common unitholders $ 29,068 $ (79,304) $ 19,078 $ (70,919) Basic earnings per common unit: Income (loss) from continuing operations $ 0.29 $ (0.87) $ 0.15 $ (1.15) Discontinued operations (0.04) 0.06 (0.03) 0.40 Net income (loss) available to common unitholders $ 0.25 $ (0.81) $ 0.12 $ (0.75) Diluted earnings per common unit: Income (loss) from continuing operations $ 0.29 $ (0.87) $ 0.15 $ (1.15) Discontinued operations (0.04) 0.06 (0.03) 0.40 Net income (loss) available to common unitholders $ 0.25 $ (0.81) $ 0.12 $ (0.75) Basic weighted average units outstanding 100,329 99,873 100,133 99,817 — — Diluted weighted average units outstanding 100,352 99,873 100,171 99,817
MACK-CALI REALTY,VERIS RESIDENTIAL, L.P. AND SUBSIDIARIESOPERATIONSCOMPREHENSIVE INCOME (LOSS) (in thousands, except per unit amounts)thousands) (unaudited)Three Months Ended
June 30,Six Months Ended
June 30,2022 2021 2022 2021 Net income (loss) $ 34,650 $ (74,031) $ 30,123 $ (60,510) Other comprehensive income (loss): Net unrealized gain (loss) on derivative instruments for interest rate swaps (60) — 2,122 — Comprehensive (income) loss $ 34,590 $ (74,031) $ 32,245 $ (60,510) Comprehensive (income) loss attributable to noncontrolling interests in consolidated joint ventures 784 1,198 1,758 2,533 Comprehensive (income) loss attributable to redeemable noncontrolling interests (6,366) (6,471) (12,803) (12,942) Comprehensive loss attributable to common unitholders $ 29,008 $ (79,304) $ 21,200 $ (70,919) For the Three Months Ended June 30, 2022 General Partner
Common UnitsLimited Partner
Common Units/
Vested LTIP UnitsCommon
UnitholdersLimited Partner
Common
UnitholdersAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interest
in Consolidated
Joint VenturesTotal Equity Balance at April 1, 2022 90,956 8,962 $ 1,201,834 $ 197,552 $ 1,995 $ 39,420 $ 1,440,801 Net income (loss) — — 26,373 2,695 — 5,582 34,650 Distributions to unitholders — — — — — — — Redeemable noncontrolling interests — — (3,524) (360) — (6,366) (10,250) Change in noncontrolling interests in consolidated joint ventures — — — — — 7 7 Vested LTIP units — 362 — — — — — Redemption of limited partners common units for common stock 11 (11) 161 (161) — — — Redemption of limited partner common units — (23) — (359) — — (359) Shares issued under Dividend Reinvestment and Stock Purchase Plan 1 — 16 — — — 16 Directors' deferred compensation plan — — 110 — — — 110 Other comprehensive income (loss) — — — (6) (54) — (60) Stock compensation 136 — 2,509 445 — — 2,954 Cancellation of common stock (41) — (696) — — — (696) Balance at June 30, 2022 91,063 9,290 $ 1,226,783 $ 199,806 $ 1,941 $ 38,643 $ 1,467,173 For the Three Months Ended June 30, 2021 General Partner
Common UnitsLimited Partner
Common Units/
Vested LTIP UnitsGeneral Partner
Common
UnitholdersLimited Partner
Common
UnitholdersAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interest
in Consolidated
Joint VenturesTotal Equity Balance at April 1, 2021 90,729 8,980 $ 1,336,498 $ 209,571 $ — $ 43,447 $ 1,589,516 Net income (loss) — — (72,079) (7,225) — 5,273 (74,031) Distributions to unitholders — — — 639 — — 639 Redeemable noncontrolling interests — — (1,550) (155) — (6,471) (8,176) Change in noncontrolling interests in consolidated joint ventures — — — — — 175 175 Vested LTIP units — 258 — — — — — Redemption of limited partners common units for common stock 175 (175) 2,716 (2,716) — — — Redemption of limited partners common units — (25) — (410) — — (410) Shares issued under Dividend Reinvestment and Stock Purchase Plan 1 — 11 — — — 11 Directors' deferred compensation plan — — 66 — — — 66 Stock compensation 42 — 1,239 1,304 — — 2,543 Cancellation of common stock — — — — — — — Balance at June 30, 2021 90,947 9,038 $ 1,266,901 $ 201,008 $ — $ 42,424 $ 1,510,333 MACK-CALI REALTY,VERIS RESIDENTIAL, L.P. AND SUBSIDIARIESCOMPREHENSIVE INCOME (LOSS) CHANGES IN EQUITY(in (in thousands) (unaudited)For the Six Months Ended June 30, 2022 General Partner
Common UnitsLimited Partner
Common Units/
Vested LTIP UnitsCommon
UnitholdersLimited Partner
Common
UnitholdersAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interest
in Consolidated
Joint VenturesTotal Equity Balance at January 1, 2022 90,948 9,013 $ 1,211,790 $ 197,236 $ 9 $ 40,383 $ 1,449,418 Net income (loss) — — 17,281 1,797 — 11,045 30,123 Distributions to unitholders — — — 218 — — 218 Redeemable noncontrolling interests — — (6,466) (651) — (12,803) (19,920) Change in noncontrolling interests in consolidated joint ventures — — — — — 18 18 Vested LTIP units — 397 — — — — — Redemption of limited partners common units for shares of general partner common units 11 (11) 161 (161) — — — Redemption of limited partner common units — (109) — (1,801) — — (1,801) Shares issued under Dividend Reinvestment and Stock Purchase Plan 2 — 27 — — — 27 Directors' deferred compensation plan — — 220 — — — 220 Other comprehensive income (loss) — — — 190 1,932 — 2,122 Stock compensation 143 — 4,466 2,978 — — 7,444 Cancellation of restricted shares (41) — (696) — — — (696) Balance at June 30, 2022 91,063 9,290 $ 1,226,783 $ 199,806 $ 1,941 $ 38,643 $ 1,467,173 For the Six Months Ended June 30, 2021 General Partner
Common UnitsLimited Partner
Common Units/
Vested LTIP UnitsGeneral Partner
Common
UnitholdersLimited Partner
Common
UnitholdersAccumulated
Other
Comprehensive
Income (Loss)Noncontrolling
Interest
in Consolidated
Joint VenturesTotal Equity Balance at January 1, 2021 90,712 9,649 $ 1,330,048 $ 217,560 $ — $ 44,772 $ 1,592,380 Net income (loss) — — (64,456) (6,463) — 10,409 (60,510) Distributions to unitholders — — — 643 — — 643 Redeemable noncontrolling interests — — (3,341) (334) — (12,942) (16,617) Change in noncontrolling interests in consolidated joint ventures — — — — — 185 185 Redemption of limited partners common units for shares of general partner common units 175 (175) 2,716 (2,716) — — — Vested LTIP units — 267 — — — — — Redemption of limited partners common units — (703) — (10,869) — — (10,869) Shares issued under Dividend Reinvestment and Stock Purchase Plan 2 — 29 — — — 29 Directors' deferred compensation plan — — 138 — — — 138 Stock compensation 58 — 1,885 3,187 — — 5,072 Cancellation of restricted shares — — (118) — — — (118) Balance at June 30, 2021 90,947 9,038 $ 1,266,901 $ 201,008 $ — $ 42,424 $ 1,510,333
MACK-CALI REALTY,VERIS RESIDENTIAL, L.P. AND SUBSIDIARIESCHANGES IN EQUITY CASH FLOWS(in (in thousands) (unaudited)Six Months Ended June 30, CASH FLOWS FROM OPERATING ACTIVITIES 2022 2021 Net income (loss) $ 30,123 $ (60,510) Net income (loss) from discontinued operations 2,852 (40,246) Net income (loss) from continuing operations 32,975 (100,756) Adjustments to reconcile net income (loss) to net cash provided by Operating activities: Depreciation and amortization, including related intangible assets 53,772 54,578 Amortization of directors deferred compensation stock units 220 138 Amortization of stock compensation 7,444 5,072 Amortization of deferred financing costs 2,358 2,190 Amortization of debt discount and mark-to-market — 232 Equity in (earnings) loss of unconsolidated joint ventures (2,151) 1,107 Distributions of cumulative earnings from unconsolidated joint ventures 13 117 Realized (gains) losses and unrealized (gains) losses on disposition of rental property, net (1,836) (3,521) (Gain) on disposition of developable land (57,748) (111) Property impairments — 6,041 Land and other impairments, net 6,832 7,932 (Gain) Loss from extinguishment of debt 6,418 46,735 Changes in operating assets and liabilities: — Decrease (increase) in unbilled rents receivable, net 5,832 (3,524) (Increase) decrease in deferred charges and other assets (6,679) 813 Decrease in accounts receivable, net (792) 4,242 Increase (decrease) in accounts payable, accrued expenses and other liabilities (1,412) (3,376) (Decrease) increase in rents received in advance and security deposits (969) 784 (Decrease) increase in accrued interest payable (503) 273 Net cash flows provided by operating activities - continuing operations 43,774 18,966 Net cash flows (used in) provided by operating activities - discontinued operations 1,936 8,981 Net cash provided by operating activities $ 45,710 $ 27,947 CASH FLOWS FROM INVESTING ACTIVITIES Rental property acquisitions and related intangibles $ (5,192) $ — Rental property additions, improvements and other costs (26,724) (32,077) Development of rental property and other related costs (58,610) (120,023) Proceeds from the sales of rental property 236,864 42,702 Proceeds from sale of investments in joint ventures — 1,975 Repayment of notes receivable 1,433 381 Investment in unconsolidated joint ventures (147) (398) Distributions in excess of cumulative earnings from unconsolidated joint ventures 7,450 4,949 Net cash provided by (used in) investing activities - continuing operations 155,074 (102,491) Net cash provided by investing activities - discontinued operations — 592,590 Net cash provided by investing activities $ 155,074 $ 490,099 CASH FLOW FROM FINANCING ACTIVITIES Borrowings from revolving credit facility $ 43,000 $ 170,000 Repayment of revolving credit facility (115,000) (33,000) Borrowings from term loans — 150,000 Repayments of term loans — (123,000) Repayments of unsecured term loans — (573,727) Proceeds from mortgages and loans payable 149,068 93,772 Repayment of mortgages, loans payable and other obligations (240,270) (129,770) Redemption of redeemable noncontrolling interests, net (12,000) — Payment of early debt extinguishment costs (5,140) (49,874) Common unit redemptions (2,497) (410) Payment of financing costs (3,025) (7,339) Contribution from noncontrolling interests 18 185 Distributions to redeemable noncontrolling interests (12,908) (12,942) Payment of common dividends and distributions (56) (468) Net cash (used in) provided by financing activities $ (198,810) $ (516,573) Net (decrease) increase in cash and cash equivalents $ 1,974 $ 1,473 Cash, cash equivalents and restricted cash, beginning of period (1) 51,455 52,302 Cash, cash equivalents and restricted cash, end of period (2) $ 53,429 $ 53,775
MACK-CALI REALTY,VERIS RESIDENTIAL, INC., VERIS RESIDENTIAL, L.P. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (in thousands) (unaudited)The accompanying notes are an integral part of these consolidated financial statements.MACK-CALI REALTY, L.P. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS(in thousands) (unaudited)(1)Includes Restricted Cash of $14,207 and $15,577 as of December 31, 2020 and 2019, respectively.(2)Includes Restricted Cash of $19,809 and $14,507 as of September 30, 2021 and 2020, respectively.The accompanying notes are an integral part of these consolidated financial statements. MACK-CALI REALTY CORPORATION, MACK-CALI REALTY, L.P. AND SUBSIDIARIES(unaudited)OrganizationMack-Cali Realty Corporation,Mack-Cali Realty,Veris Residential, L.P., a Delaware limited partnership, together with its subsidiaries (collectively, the “Operating Partnership”), as its sole general partner and owned a 91.090.7 and 90.491.0 percent common unit interest in the Operating Partnership as of SeptemberJune 30, 20212022 and December 31, 2020,2021, respectively. The General Partner’s business is the ownership of interests in and operation of the Operating Partnership and all of the General Partner’s expenses are incurred for the benefit of the Operating Partnership. The General Partner is reimbursed by the Operating Partnership for all expenses it incurs relating to the ownership and operation of the Operating Partnership. management, acquisition, development and tenant-related services for its General Partner. The Operating Partnership, through its operating divisions and subsidiaries, including the Mack-CaliVeris property-owning partnerships and limited liability companies, is the entity through which all of the General Partner’s operations are conducted. Unless stated otherwise or the context requires, the “Company” refers to the General Partner and its subsidiaries, including the Operating Partnership and its subsidiaries.SeptemberJune 30, 2021,2022, the Company owned or had interests in 36 real estate properties (the “Properties”). and developable land. The Properties are comprised of 823 multifamily rental properties as well as non-core assets comprised of 6 office buildings totaling approximately 5.1 million square feetproperties, 4 parking/retail properties and leased to approximately 110 tenants, 20 multi-family3 hotels. The Properties are comprised of: (a) 27 wholly-owned or Company-controlled properties totaling 6,018 apartment units (which include 6comprised of 16 multifamily properties aggregating 1,786 apartment unitsand 11 non-core assets, and (b) 9 properties owned by unconsolidated joint ventures in which the Company has investment interests), 4 parking/retailinterests, including 7 multifamily properties totaling approximately 108,000 square feet (which include and 2 non-core assetsa. building aggregating 51,000 square feet owned by an unconsolidated joint venture in which the Company has an investment interest), 3 hotels containing 723 rooms (one of which is owned by an unconsolidated joint venture in which the Company has an investment interest), and 1 parcel of land leased to a third party. The Properties are located in 3 states in the Northeast, plus the District of Columbia.On December 19, 2019, the Company announced that its Board had determined to sell the Company’s entire suburban New Jersey office portfolio totaling approximately 6.6 million square feet, which had excluded the Company’s office properties in Jersey City and Hoboken, New Jersey (collectively, the “Suburban Office Portfolio”). As the decision to sell the Suburban Office Portfolio represented a strategic shift in the Company’s operations, these properties’ results (other than a single property not qualified to be classified as held for sale) are being classified as discontinued operations for all periods presented herein. See Note 7: Discontinued Operations.20202021 10-K: Significant Accounting Policies – Investments in Unconsolidated Joint Ventures, for the Company’s treatment of unconsolidated joint venture interests. Intercompany accounts and transactions have been eliminated.Mack-Cali Realty Corporation.Veris Residential, Inc.. As the Operating Partnership is already consolidated in the balance sheets of Mack-Cali Realty Corporation,Veris Residential, Inc., the identification of this entity as a variable interest entity has no impact on the consolidated financial statements of Mack-Cali Realty Corporation.Veris Residential, Inc.. There were no other legal entities qualifying under the scope of the revised guidance that were consolidated as a result of the adoption.SeptemberJune 30, 20212022 and December 31, 2020,2021, the Company’s investments in consolidated real estate joint ventures, which are variable interest entities in which the Company is deemed to be the primary beneficiary, other than Veris Residential Partners, L.P., formerly known as Roseland Residential, L.P. (See Note 15:14: Redeemable Noncontrolling Interests – Rockpoint Transaction), have total real estate assets of $479.2$473.4 million and $486.1$477.5 million, respectively, other assets of $6.1$5.8 million and $4.5$5.3 million, respectively, mortgages of $286.1$285.6 million and $284.8$285.7 million, respectively, and other liabilities of $21.7$20.1 million and $21$21.2 million, respectively.2020,2021, as certain disclosures in this Quarterly Report on Form 10-Q that would duplicate those included in the 10-K are not included in these financial statements.$0.7$0.4 million and $0.4$0.6 million for the three months ended SeptemberJune 30, 20212022 and 2020,2021, respectively, and $1.9$0.9 million and $1.3$1.2 million for the ninesix months ended SeptemberJune 30, 20212022 and 2020,2021, respectively. Ordinary repairs and maintenance are expensed as incurred; major replacements and betterments, which improve or extend the life of the asset, are capitalized and depreciated over their estimated useful lives. Fully-depreciated assets are removed from the accounts.SeptemberJune 30, 20212022 and December 31, 20202021 is real estate and building and tenant improvements not in service, as follows (dollars in thousands):June 30,
2022December 31,
2021Land held for development (including pre-development costs, if any) (a)(b) $ 289,459 $ 341,496 Development and construction in progress, including land (c) 446,281 694,768 Total $ 735,740 $ 1,036,264 $164.4$118.0 million and $160.3$150.9 million as of SeptemberJune 30, 20212022 and December 31, 2020,2021, respectively.$71.5 million and $74.9$68.8 million as of SeptemberJune 30, 20212022 and December 31, 2020,2021, respectively.$50.8$35.2 million of land and $205.2$77.6 million of building and improvements pertaining to assets held for sale at SeptemberJune 30, 20212022..multi-familymultifamily units of each portion, and capitalizes only those costs associated with the portion under construction.dividendsdividend obligations as a REIT on taxable income expected for 2020, the Board made the strategic decision to suspend its common dividends and distributions for the remainder of 2020 in an effort to provide greater financial flexibility during the pandemic and to retain incremental capital to support leasing initiatives at its Harborside commercial office properties on the Jersey City waterfront. On March 19, 2021, the Company announced that its Board of Directors would continue to suspend its common dividend for the remainder of 2021 in order to conserve capital and allow for greater financial flexibility during this period of heightened economic uncertainty and based on the Company’s then projected 2021 taxable income estimates. The Company believes that with its estimated taxable income/loss for 2021, it will meethas met its dividendsdividend obligations as a REIT for the year with no dividends paid.SeptemberJune 30, 20212022 and December 31, 2020 represents2021 represent amounts payable on unvested LTIP units.MarchJune 2020, the FASB issued ASU 2020-04 Reference Rate Reform (Topic 848) Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments provide practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance is optional and is effective between March 12,June 30, 2020 and December 31, 2022. The guidance may be elected over time as reference rate reform activities occur. The Company is currently in the process of evaluatingdoes not expect the impact the adoption of ASU 2020-04 willto have a material impact on the Company’s consolidated financial statements.propertiesproperty commenced initial operations during the ninesix months ended SeptemberJune 30, 20212022 (dollars in thousands):In Service Date Property Location Property Type # of
Apartment UnitsTotal
Development
Costs Incurred04/01/22 Haus25 (a) Jersey City Multi-Family 750 $ 347,918 Totals 750 $ 347,918 SeptemberJune 30, 2021, 1932022, 631 apartment units are in service. The development costs included approximately $2.9 million in land costs.(b)AsTable of September 30, 2021, 206 apartment units are in service. The remaining 107 apartment units are expected to be placed in service in the fourth quarter of 2021. The development costs included approximately $2.7 million in land costs.contentsAdditionally, a land lease located in Parsippany, New Jersey, with 2 restaurant tenants, also commenced initial operations during the nine months ended September 30, 2021. Development costs incurred amounted to $5.1 million. This land lease was sold by the Company on June 30, 2021.Unconsolidated Joint VenturesOn April 29, 2021, the Company sold its interest in the 12 Vreeland Road joint venture for a gross sales price of approximately $2 million, with 0 gain or loss on the transaction.On September 1, 2021, the Company sold its interest in the Offices at Crystal Lake joint venture to its venture partner for $1.9 million and recorded a loss on the sale of approximately $1.9 million in the three and nine months ended September 30, 2021.On December 19, 2019, theannounced thathad discontinued operations related to its Board had determined to sell the Company’s entireformer suburban New Jersey office portfolio totaling approximately 6.6 million square feet, which had excluded the Company’s office properties in Jersey City and Hoboken, New Jersey (collectively, the “Suburban Office Portfolio”). As the decision to sell the Suburban Office Portfolio which representedthese properties’ results (other than a single property not qualifiedin 2019. The Company has sold all but one of those assets and expects to be classified as held for sale) are being classified as discontinued operations for all periods presented herein.dispose of this final suburban office asset in the fourth quarter of 2022. See Note 7: Discontinued Operations.In late 2019 through September 30, 2021, the Company completed the sale of 35 of these suburban office properties, totaling 6 million square feet, for net sales proceeds of $1.0 billion. In October 2021, the Company completed the sale of the last Suburban Office Portfolio property classified as held for sale, which was a 248,480 square foot office property, for a gross sales price of $25.3 million. As a result of a change in the estimated selling costs for this disposition, the Company recognized an unrealized gain of $0.5 million during the three and nine months ended September 30, 2021 (partially reversing cumulative held for sale loss allowances recognized).SeptemberJune 30, 2021,2022, the Company identified as held for sale 2 office properties totaling approximately 1.81.6 million square feet to be sold separately,and several developable land parcels, which are located in Jersey City, Holmdel, Parsippany, Morris Township, Wall and Hoboken, New Jersey. The total estimated sales proceeds, net of expected selling costs but before the required aggregate paydown of $400 million of mortgages encumbering the properties and related costs, are expected to be approximately $570 million. The Company may need to pay significant prepayment costs between approximately $20 million to $25 million to pay down these mortgage loans which will be expensed when incurred at the time of such paydown.Additionally, the Company also identified a small retail pad leased to others and several developable land parcels as held for sale as of September 30, 2021, including a developable land parcel in Jersey City,Weehawken, New Jersey. As a result of recent sales contracts in place, and after considering the current market conditions as a result of the challenging economic climate with the current worldwide COVID-19 pandemic, the Company determined that the carrying value of 21 of the remaining held for sale properties and a2 land parcelparcels held for sale was not expected to be recovered from estimated net sales proceeds, and accordingly, during the three and six months ended June 30, 2022, recognized an unrealized held for sale loss allowance of $3.0$4.4 million and $3.5 million for the properties (none(all of which is included in discontinued operations), and also recorded land and other impairments of $0.3 million and $0.7 million, during the three and nine months ended September$3.9 million.2021, respectively. As a result of a recent sales contract in place for a2022 2 land parcelparcels that were previously identified as held for sale the Company recognized an unrealized gainwere reclassified as held and used resulting in transaction costs of $3.7 million during both the three and nine months ended September 30, 2021 (reversing cumulative$0.1 million.loss allowances recognized).Suburban
Office
PortfolioOther Assets
Held for SaleTotal Land $ 4,336 $ 122,660 $ 126,996 Building & Other 25,945 360,731 386,676 Less: Accumulated depreciation (12,165) (128,442) (140,607) Less: Cumulative unrealized losses on property held for sale (4,440) $ — (4,440) Real estate held for sale, net $ 13,676 $ 354,949 $ 368,625 Other assets and liabilities Suburban
Office
PortfolioOther Assets
Held for SaleTotal Unbilled rents receivable, net (a) $ 572 $ 15,671 $ 16,243 Deferred charges, net (a) 682 12,164 12,846 Mortgages & loans payable, net (a) — (249,155) (249,155) Accounts payable, accrued exp & other liability (1,054) (4,890) (5,944) Unearned rents/deferred rental income (a) — (3,778) (3,778) Classified as discontinued operations at September 30, 2021 for all periods presented. See Note 7: Discontinued Operations.(b)Expected to be removed with the completion of the sales.(c)Includes $19.2 million of right of use assets expected to be removed with the completion of the sales.(d)Includes $20.5 million of right of use liabilities expected to be removed with the completion of the sales.propertiesproperty during the ninesix months ended SeptemberJune 30, 20212022 (dollars in thousands):Disposition
DateProperty/Address Location # of
Bldgs.Rentable
Square
FeetProperty
TypeNet
Sales
ProceedsNet
Carrying
ValueRealized
Gains
(Losses)
Unrealized
Losses, netDiscontinued
Operations
Realized
Gains
(Losses)/
Unrealized
Losses, net01/21/22 111 River Street Hoboken, New Jersey 1 566,215 Office $ 208,268 (a) $ 206,432 $ 1,836 $ — Unrealized gains (losses) on real estate held for sale — (4,440) Totals 1 566,215 $ 208,268 $ 206,432 $ 1,836 $ (4,440) As part of the consideration from the buyer, 678,302 Common Units were redeemed by the Company at a book value of $10.5 million, which was a non-cash portion of this sales transaction. The balance of the proceeds was received in cash and used to repay the Company's borrowings on its unsecured revolving credit facility. See Note 17: Noncontrolling Interests in Subsidiaries - Noncontrolling Interests in Operating Partnership.(b)Includes $10 million of seller financing provided to the buyers of the Metropark portfolio. See Note 5: Deferred charges, goodwill and other assets, net.(c)The mortgage loan encumbering three of the propertiesproperty was defeasedrepaid at closing, for which the Company incurred costs of $22.6$6.3 million. These costs were expensed as loss from extinguishment of debt during the threesix months ended June 30, 2021.2022.On May 24, 2021, theThe Company disposed of athe following developable land parcel locatedholdings during the six months ended June 30, 2022 (dollars in Hamilton, New Jersey, forthousands):Disposition
DateProperty Address Location Net
Sales
ProceedsNet
Carrying
ValueRealized
Gains
(Losses)/
Unrealized
Losses, net03/22/22 Palladium residential land West Windsor, New Jersey $ 23,908 $ 24,182 $ (274) 03/22/22 Palladium commercial land West Windsor, New Jersey 4,688 1,791 2,897 04/15/22 Port Imperial Park parcel (a) Weehawken, New Jersey 29,331 29,744 (413) 04/21/22 Urby II/III (a) Jersey City, New Jersey 68,854 13,316 55,538 Totals $ 126,781 $ 69,033 $ 57,748 salessale proceeds were held by a qualified intermediary, which is recorded in deferred charges and other assets as of $745,000 (and recorded a net gain of $111,000 on the disposition).In October 2021, the Company completed the sale of a 248,480 square foot office property classified as held for sale at SeptemberJune 30, 2021, for a gross sales price of $25.3 million.of ownership, which occurred during the second quarter 2021, the Company evaluated the recoverability of the carrying value of its office property in Hoboken, New Jersey (which was subsequently classified as held for sale as of September 30, 2021), and determined thatseveral land parcels, it was necessary to reduce the carrying value of the propertythese assets to itstheir estimated fair value.values. Accordingly, the Company recorded an impairment charge of $6.0$2.9 million on the office property at June 30, 2021, which is includedland parcels in propertyland and other impairments on the consolidated statement of operations. Also, as a result of the Company’s shortening of its expected holding period beginning in the second quarter 2021, the Company evaluated the recoverability of the carrying values of its land parcels during the second and third quarters 2021 and determined that it was necessary to reduce the carrying value of a held-and-used developable land parcel located in Jersey City, New Jersey, to its estimated fair value and recorded in land and other impairment charges an amount of $6.8 million and $14.3 million, respectively,operations for the three and ninesix months ended SeptemberJune 30, 2021.2022.SeptemberJune 30, 2021,2022, the Company had an aggregate investment of approximately $148.5$132.8 million in its equity method joint ventures. The Company formed these ventures with unaffiliated third parties, or acquired interests in them, to develop or manage primarily office and multi-family rental properties, or to acquire land in anticipation of possible development of office and multi-family rental properties. As of SeptemberJune 30, 2021,2022, the unconsolidated joint ventures owned: 6 multi-family7 multifamily properties totaling 1,7862,146 apartment units, a retail property aggregating approximately 51,000 square feet, a 351-room hotel a development project for up to approximately 360 apartment units, which commenced initial operation in March 2021; and interests and/or rights to developable land parcels able to accommodate up to 1,621771 apartment units. The Company’s unconsolidated interests range from 20 percent to 85 percent subject to specified priority allocations in certain of the joint ventures.SeptemberJune 30,2021, such debt had a total borrowing capacity of up to $303.8 million of which the Company agreed to guarantee up to $33.2 million. As of September 30, 2021, 2022, the outstanding balance of such debt, subject to guarantees, totaled $295.8$189.8 million of which $32.4$22 million was guaranteed by the Company. The Company performed management, leasing, development and other services for the properties owned by the unconsolidated joint ventures, related parties to the Company, and recognized $0.9 million and $1.2$0.9 million for such services in the three months ended SeptemberJune 30, 20212022 and 2020,2021, respectively. The Company had $0.2 million and $0.3$0.2 million in accounts receivable due from its unconsolidated joint ventures as of SeptemberJune 30, 20212022 and December 31, 2020,2021, respectively.Included in the Company’sSeptemberJune 30, 20212022 that are considered VIEs. The Company had 3 investments in unconsolidated development joint ventures 2 of which are currently completed-development, in-service operating properties, which are VIEs for which the Company is not the primary beneficiary. These joint ventures were primarily established to develop real estate property for long-term investment and were deemed VIEs primarily based on the fact that the equity investment at risk was not sufficient to permit the entities to finance their activities without additional financial support. The initial equity contributed to these entities was not sufficient to fully finance the real estate construction as development costs are funded by the partners throughout the construction period. The Company determined that it was not the primary beneficiary of these unconsolidated joint ventures are no longer VIEs based on the fact that the Company has shared control ofsince these entities along with the entity’s partnersventures have completed their development projects and therefore does not have controlling financial interestsare now in these VIEs. The Company’s aggregate investment in these VIEs was approximately $104.3 million as of September 30, 2021. The Company’s maximum exposure to loss as a result of its involvement with these VIEs is estimated to be approximately $138.3 million, which includes the Company’s current investment and estimated future funding commitments/guarantees of approximately $34.0 million. The Company has not provided financial support to these VIEs that it was not previously contractually required to provide. In general, future costs of development not financed through third parties will be funded with capital contributions from the Company and its outside partners in accordance with their respective ownership percentages. SeptemberJune 30, 20212022 and December 31, 20202021 (dollars in thousands):
40 Park (b) (c)Entity / Property Name Number of
Apartment Units
or Rentable SFCompany's
Effective
Ownership % (a)Carrying Value Balance Property Debt Interest
RateAs of June 30, 2022 June 30,
2022December 31,
2021Maturity
DateMultifamily Metropolitan and Lofts at
40 Park (b) (c)189 units 25.00 % $ 2,187 $ 2,547 $ 60,767 (d) (d) RiverTrace at Port Imperial 316 units 22.50 % 5,733 6,077 82,000 11/10/26 3.21 % Capstone at Port Imperial 360 units 40.00 % 25,651 27,401 135,000 12/22/24 SOFR+ 1.2 % Riverpark at Harrison 141 units 45.00 % — — 30,192 07/01/35 3.19 % Station House 378 units 50.00 % 32,640 33,004 92,391 07/01/33 4.82 % Urby at Harborside (e) 762 units 85.00 % 64,197 66,418 189,845 08/01/29 5.197 % PI North - Land (b) (f) 771 potential units 20.00 % 1,678 1,678 — — — Liberty Landing (g) 850 potential units 50.00 % 300 300 — — — Other Hyatt Regency Hotel Jersey City 351 rooms 50.00 % — — 100,000 10/01/26 3.668 % Other (h) 404 347 — — — Totals: $ 132,790 $ 137,772 $ 690,195 multi-familymultifamily rental property ("Lofts at 40 Park").The venture has a construction loan with a maximum borrowing amount of $112,000, of which the Company has guaranteed 10 percent of the principal outstanding. The loan has a one year extension option.(f)The Company owns an 85 percent interest with shared control over major decisions such as, approval of budgets, property financings and leasing guidelines. The Company has guaranteed $22 million of the principal outstanding debt.(g)(f)The Company owns a 20 percent residual interest in undeveloped land parcels: parcels 6, I, and J that can accommodate the development of 771 apartment units.(h)(g)On April 29, 2021,Pursuant to a notice letter to its joint venture partner dated January 6, 2022, the Company sold its interest inintends to not proceed with the joint venture for a gross sales priceacquisition and development of approximately $2 million.Liberty Landing.(i)On September 1, 2021, the Company sold its interest in the joint venture for a gross sales price of approximately $1.9 million.(j)(h)The Company owns other interests in various unconsolidated joint ventures, including interests in assets previously owned and interest in ventures whose businessesninethree and six months ended SeptemberJune 30, 20212022 and 20202021 (dollars in thousands):Three Months Ended
June 30,Six Months Ended
June 30,Entity / Property Name 2022 2021 2022 2021 Multifamily Metropolitan and Lofts at 40 Park $ (95) $ (265) $ (233) $ (496) RiverTrace at Port Imperial 80 (5) 147 (10) Capstone at Port Imperial (a) 23 (458) 49 (458) Riverpark at Harrison 45 (76) 45 (126) Station House (96) (454) (455) (819) Urby at Harborside (b) 2,793 1,680 2,768 936 PI North - Land (102) (62) (173) (118) Liberty Landing (10) — (10) — Office 12 Vreeland Road (c) — 2 — 2 Offices at Crystal Lake (d) — (16) — (135) Other Other — 3 13 117 Company's equity in earnings (loss) of unconsolidated joint ventures (e) $ 2,638 $ 349 $ 2,151 $ (1,107) Amounts are net of amortization of basis differences of $141 and $143 for the three months ended September 30, 2021 and 2020, respectively, and $427 and $438 for the nine months ended September 30, 2021 and 2020, respectively.(b)On March 12, 2020, the Company acquired its equity partner's 80 percent interest and increased ownership to 100 percent.(c)On December 31, 2020, the Crystal House Apartment Investors LLC, an unconsolidated joint venture property sold its sole apartment property. The Company realized its share of the gain on the property sale from the unconsolidated joint venture of $35.1 million.(d)The property commenced operations in second quarter 2021.(e)(b)AsIncludes $2.6 million of September 30, 2021, the joint venture agreed to settle certain obligations regarding a previously owned development project, of which the Company’s share of the expenseventure’s income from its sale of an economic urban tax credit certificate from the State of New Jersey to a third party. The venture has an agreement to sell tax credits to a third party over the next five years for such settlement was $0.9$3.0 million which was recorded in equity in earningsper year for thisa total of $15 million. The sales are subject to the venture obtaining the tax credits from the State of New Jersey each year and transferring the tax credit certificate to the buyer each year.three and nine months ended September 30, 2021.joint venture for a gross sale price of approximately $2 million.(f)(d)On September 1, 2021, the Company sold its interest in this unconsolidated joint venture to its venture partner for $1.9 million,million.realized a loss on$143 for the sale of approximately $1.9 million.three months ended June 30, 2022 and 2021, respectively, and $309 and $286 for the six months ended June 30, 2022 and 2021, respectively.GOODWILL AND OTHER ASSETS, NET(dollars in thousands) June 30,
2022December 31,
2021Deferred leasing costs $ 85,841 $ 88,265 Deferred financing costs - revolving credit facility (a) 6,684 6,684 92,525 94,949 Accumulated amortization (41,052) (40,956) Deferred charges, net 51,473 53,993 Notes receivable (b) 2,718 4,015 In-place lease values, related intangibles and other assets, net (c) In-place lease values, related intangibles and other assets, net (c) 10,706 42,183 Right of use assets (c) Right of use assets (c) 2,896 22,298 Prepaid expenses and other assets, net (d) Prepaid expenses and other assets, net (d) 135,674 28,858 Total deferred charges and other assets, net Total deferred charges and other assets, net $ 203,467 $ 151,347 Includes asAs of SeptemberJune 30, 20212022 and December 31, 2020,2021, respectively, includes an interest-free note receivable with a net present value of $0.8$0.4 million and $1.2$0.7 million which matures in April 2023. The Company believes this balance is fully collectible. Also includes $4.8$2.1 million, net of a loan loss allowance of $5.2$0.1 million, as of SeptemberJune 30, 2022 and $3.1 million, net of a loan loss allowance of $0.2 million, as of December 31, 2021, of seller-financing provided by the Company to the buyers of the Metropark portfolio. The receivable is secured against available cash of one1 of the Metropark properties disposed of and earned an annual return of 4 percent for 90 days after the disposition, with the interest rate increased to 15 percent thereafter. The Company recorded a loan loss allowance charge of $5.2 million at September 30,through November 18, 2021 based on expected losses, by calculating the net present value of estimated cash flows of one property of the Metropark portfolio as the Company considered the principal amountand to be past due (See Note 12: Disclosure of fair value of assets and liabilities). Such charge was recorded in Interest and other investment income (loss) for the three and nine months ended September 30, 2021. The Company elected10 percent thereafter, pursuant to account for the Metropark receivable under the cost recovery method and moved the Metropark receivable to a non-accrual status. There is no interest accrued associated with the note receivable. See Note 3: Transactions – Real Estate Held for Sale/Discontinued Operations/Dispositions.an amended operating agreement.All goodwill is attributable to the Company’s Multi-family Real Estate and Services segment.(d)This amount has a corresponding liability of $3.2 million and $23.7 million as of June 30, 2022 and December 31, 2021, respectively, which is included in Accounts payable, accrued expense and other liabilities. See Note 13:12: Commitments and Contingencies – Ground Lease agreements for further details.(e)(d)Includes asAs of SeptemberJune 30, 2021 and December 31, 2020, $1.72022, includes $98.3 million and $42.5 million, respectively, for properties classified as discontinued operations.of funds available with the Company’s qualified intermediary from property sales proceeds, which were utilized in the acquisition of a property in Park Ridge, New Jersey, in July 2022.has historically usedprimarily uses interest rate swaps and caps as part of its interest rate risk management strategy. As of September 30, 2021 and December 31, 2020, the Company did 0t have any outstanding interestInterest rate swaps that were designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. Interest rate caps designated as cash flow hedges involve the receipt of variable amounts from a counterparty if interest rates rise above the strike rate risk.isare recorded in accumulated other comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on the Company’s variable-rate debt. During the next 12 months, the Company estimates 0 additional amount to$1.0 million will be reclassified as a decrease to interest expense.Asset Derivatives designated
as hedging instrumentsBalance sheet location June 30,
2022December 31,
2021Interest rate caps $ 4,883 $ 850 Deferred charges and other assets StatementStatements of Operations for the ninethree and six months ending SeptemberJune 30, 20212022 and 20202021 (dollars in thousands):Derivatives in Cash Flow Hedging Relationships Amount of Gain or (Loss) Recognized in OCI on Derivative Location of Gain or (Loss) Reclassified from Accumulated OCI into Income Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income Total Amount of Interest Expense presented in the consolidated statements of operations Three months ended June 30, 2022 2021 2022 2021 2022 2021 Interest Rate Caps $ (60) $ — Interest expense $ (2,213) $ — $ (17,707) $ (16,554) Six months ended June 30, Interest Rate Caps $ 2,122 $ — Interest expense $ (2,097) $ — $ (32,733) $ (34,164) The Company had agreements with each of its derivative counterparties that contained a provision where the Company could be declared in default on its derivative obligations if repayment of the underlying indebtedness was accelerated by the lender due to the Company's default on the indebtedness. SeptemberJune 30, 2021,2022, the Company did 0tnot have any outstanding derivatives. and property expenses established pursuant to certain mortgage financing arrangements, and is comprised of the following (dollars in thousands):June 30,
2022December 31,
2021Security deposits $ 8,380 $ 6,884 Escrow and other reserve funds 15,976 12,817 Total restricted cash $ 24,356 $ 19,701 which had excludedexcluding the Company’s office properties in Jersey City, and Hoboken, New Jersey. As the decision to sell the Suburban Office Portfolio represented a strategic shift in the Company’s operations, these properties’ results (other than a single property not qualified to be classified as held for sale) are being classified as discontinued operations for all periods presented herein.and through September 30,December 31, 2021, the Company completed the sale of 35all but one of these suburban officeits 37 properties in the Suburban Office Portfolio, totaling 66.3 million square feet, for net sales proceeds of $1.0 billion. In October 2021,The last property in the Company completed the sale of the last Suburban Office Portfolio, a 350,000 square foot office property, classifiedwas reclassified as held for sale which was a 248,480 square foot officeat June 30, 2022, and the Company expects to dispose of this property for a gross sales pricein the fourth quarter of $25.3 million.2022. As a result of a changethe sales contract in the estimated selling price, net of selling costs, for this disposition,place, the Company recognized an unrealized gaindetermined that the carrying value of $0.5 millionthe held for sale property was not expected to be recovered from estimated net sales proceeds and accordingly, during the three and six months ended SeptemberJune 30, 2021 (partially reversing cumulative2022, recognized an unrealized held for sale loss allowances recognized).ninesix months ended SeptemberJune 30, 20212022 and 20202021 (dollars in thousands):Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Total revenues $ 1,546 $ 7,405 $ 3,012 $ 30,602 Operating and other expenses (407) (2,879) (732) (11,945) Depreciation and amortization (296) (648) (692) (1,702) Interest expense — (277) — (1,570) Income from discontinued operations 843 3,601 1,588 15,385 Unrealized gains (losses) on disposition of rental property (a) (4,440) (951) (4,440) 69 Realized gains (losses) on disposition of rental property Realized gains (losses) on disposition of rental property — 3,031 — 24,792 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net (4,440) 2,080 (4,440) 24,861 Total discontinued operations, net $ (3,597) $ 5,681 $ (2,852) $ 40,246 including reversals, and impairment charges on properties classified as discontinued operations in 2021 and 2020.operations.(b)See Note 3: Real Estate Transactions – Dispositions for further information regarding properties sold and related gains (losses).SENIOR UNSECURED NOTESA summary of the Company’s senior unsecured notes as of September 30, 2021 and December 31, 2020 is as follows (dollars in thousands):(1)On May 6, 2021, the Company retired these notes earlier than their maturity, using net sales proceeds from completed office property sales and borrowings under its 2021 credit facility and term loan. In conjunction with the notes being discharged, the Company incurred costs of $24.2 million (including a make-whole premium) which was expensed as loss from extinguishment of debt during the nine months ended September 30, 2021. See Note 9: Revolving Credit Facility and Term Loans.9. REVOLVING CREDIT FACILITY AND TERM LOANSseven7 lenders that provides for a $250 million senior secured revolving credit facility (the “2021 Credit Facility") and a $150 million senior secured term loan facility (the “2021 Term Loan”), and delivered written notice to the administrative agent to terminate the 2017 credit agreement, which termination became effective on May 13, 2021.include:included: (1) an eighteen month term ending in November 2022; (2) a single draw of the term loan commitments up to an aggregate principal amount of $150 million; and (3) a first priority lien in unencumbered properties of the Company with an appraised value greater than or equal to $800 million which must include the Company’s Harborside 2/3 and Harborside 5 properties. Furthermore, construction loans secured by two multi-family residential property development projects contain cross-acceleration provisions that would constitute an event of default requiring immediate repayment of the construction loans if the change of control provisions under the 2021 Credit Facility are triggered and the lenders declare a default and exercise their rights under the 2021 Credit Facility and accelerate repayment of the outstanding borrowings thereunder. If these change of control provisions were triggered, the Company could seek a forbearance, waiver or amendment of the change of control provisions from the lenders, however there can be no assurance that the Company would be able to obtain such forbearance, waiver or amendment on acceptable terms or at all. If an event of default has occurred and is continuing, the entire outstanding balance under the 2021 Credit Agreement may (or, in the case of any bankruptcy event of default, shall) become immediately due and payable, and the Company will not make any excess distributions except to enable the General Partner to continue to qualify as a REIT under the IRS Code.(See Note 8: Senior Unsecured Notes.) In June 2021, the Company paid down a total of $123 million of borrowings under the 2021 Term Loan, using sales proceeds from several of the Company’s suburban office property dispositions. On July 27, 2021, the Company repaid the outstanding balance of the 2021 Term Loan of $27 million using proceeds from the disposition of a suburban office properties previously held for sale. (See Note 3: Recent Transactions – Real Estate Held for Sale/Discontinued Operations/Dispositions).The terms of the 2017 credit facility included: (1) a four year term ending in January 2021, with 2 six month extension options, subject to the Company not being in default on the facility and with the payment of a fee of 7.5 basis points for each extension; (2) revolving credit loans may be made to the Company in an aggregate principal amount of up to $600 million, with a sublimit under the 2017 credit facility for the issuance of letters of credit in an amount not to exceed $60 million (subject to increase as discussed below), of which $10.6 million of letters of credit had been issued as of May 6, 2021; (3) an interest rate, based on the Operating Partnership’s unsecured debt ratings from Moody’s or S&P, or, at the Operating Partnership’s option, if it no longer maintained a debt rating from Moody’s or S&P, or such debt ratings fell below Baa3 and BBB-, based on a defined leverage ratio; and (4) a facility fee, payable quarterly based on the Operating Partnership’s unsecured debt ratings from Moody’s or S&P, or, at the Operating Partnership’s option, if it no longer maintained a debt rating from Moody’s or S&P or such debt ratings fell below Baa3 and BBB-, based on a defined leverage ratio. In January 2021, the Company elected to exercise the first option to extend the 2017 credit facility maturity date for a period of six months. Accordingly, the term of the 2017 credit facility was extended through its termination in May 2021, with the Company’s payment of the 7.5 basis point extension fee.After electing to use the defined leverage ratio in 2018 to determine the interest rate, the interest rates on outstanding borrowings, alternate base rate loans and the facility fee on the borrowing capacity, payable quarterly in arrears, on the 2017 credit facility were based on the following total leverage ratio grid:SeptemberJune 30, 2021.2022.SeptemberJune 30, 20212022 and December 31, 2020,2021, the Company had borrowings of $174$76 million and $25$148 million under its revolving credit facility, respectively, and had 0 outstanding borrowings under its term loan as of both September 30, 2021 and December 31, 2020. 10.9. MORTGAGES, LOANS PAYABLE AND OTHER OBLIGATIONSSeptemberJune 30, 2021, 222022, 21 of the Company’s properties, with a total carrying value of $3.5approximately $3.2 billion, and 1 of the Company’s land and development projects, with a total carrying value of $444approximately $483.0 million, are encumbered by the Company’s mortgages and loans payable. Payments on mortgages, loans payable and other obligations are generally due in monthly installments of principal and interest, or interest only. The Company was in compliance with its debt covenants requirements under its mortgages and loans payable as of SeptemberJune 30, 2021.SeptemberJune 30, 20212022 and December 31, 20202021 is as follows (dollars in thousands):Property/Project Name Lender June 30,
2022 December 31,
2021 Maturity 111 River St. (b) Athene Annuity and Life Company 3.90 % $ — $ 150,000 — Port Imperial 4/5 Hotel (c) Fifth Third Bank LIBOR+ 3.40 % 89,000 89,000 04/01/23 Portside at Pier One CBRE Capital Markets/FreddieMac 3.57 % 58,998 58,998 08/01/23 Signature Place Nationwide Life Insurance Company 3.74 % 43,000 43,000 08/01/24 Liberty Towers American General Life Insurance Company 3.37 % 265,000 265,000 10/01/24 Haus25 (d) QuadReal Finance LIBOR+ 2.70 % 291,672 255,453 12/01/24 Portside 5/6 (e) New York Life Insurance Company 4.56 % 97,000 97,000 03/10/26 BLVD 425 New York Life Insurance Company 4.17 % 131,000 131,000 08/10/26 BLVD 401 New York Life Insurance Company 4.29 % 117,000 117,000 08/10/26 101 Hudson Wells Fargo CMBS 3.20 % 250,000 250,000 10/11/26 The Upton (f) Bank of New York Mellon LIBOR+ 1.58 % 75,000 75,000 10/27/26 145 Front at City Square MUFG Union Bank LIBOR+ 1.84 % 63,000 63,000 12/10/26 Riverhouse 9 at Port Imperial (g) JP Morgan Chase Bank SOFR+ 1.41 % 110,000 87,175 06/01/27 Quarry Place at Tuckahoe Natixis Real Estate Capital LLC 4.48 % 41,000 41,000 08/05/27 BLVD 475 N/S The Northwestern Mutual Life Insurance Co. 2.91 % 165,000 165,000 11/10/27 Riverhouse 11 at Port Imperial The Northwestern Mutual Life Insurance Co. 4.52 % 100,000 100,000 01/10/29 Soho Lofts (h) New York Community Bank 3.77 % 160,000 160,000 07/01/29 Port Imperial South 4/5 Garage (i) American General Life & A/G PC 4.85 % 32,418 32,664 12/01/29 Emery at Overlook Ridge New York Community Bank 3.21 % 72,000 72,000 01/01/31 Principal balance outstanding 2,161,088 2,252,290 Unamortized deferred financing costs (9,599) (11,220) Total mortgages, loans payable and other obligations, net $ 2,151,489 $ 2,241,070 (c) This construction The loan hasrequires a maximum borrowing capacity of $92 million and provides, subject to certain conditions, and a one year extension option with a fee of 15 basis points, ofdebt service coverage charge test (“DSCR Test”), which the Company has guaranteed 10 percent ofwas not in compliance with for the outstanding principal, subject to certain conditions.(d) This construction loan has a maximum borrowing capacity of $64 million and provides, subject to certain conditions, and an 18 month extension option with a fee of 30 basis points, of whichquarter ended March 31, 2022. Therefore, the Company has guaranteed 15 percentwas required to deposit three months of the outstanding principal, subjectinterest amounting to certain conditions. On October 27, 2021,$0.7 million into an escrow account and sweep all excess property level cash flows into such escrow account until two consecutive periods have passed where the Company obtainedis in compliance with the DSCR Test. The Company does not believe this will have a new $75 million mortgage loan from a different lender maturing in October 2026 and repaid the existing loan.(e)In January 2020, the Company increased the sizematerial impact on its results of the loan on Liberty Towers to $265 million, generating $33 million of additional proceeds.operations or financial condition.(f)(d)This construction loan has a LIBOR floor of 2.0 percent, has a maximum borrowing capacity of $300 million and provides, subject to certain conditions, 1a one year extension option with a fee of 25 basis points.(g) (e)The Company has guaranteed 10 percent of the outstanding principal, subject to certain conditions.(h)(f)Properties which were collateral for thisOn October 27, 2021, the Company obtained a $75 million mortgage loan were disposedmaturing in October 2026 and repaid the existing construction loan. The Company entered into an interest-rate cap agreement for the mortgage loan.on April 20, 2021. This$92 million. On June 21, 2022, the Company obtained a $110 million mortgage loan does not permit early pre-payment. In April 2021, asmaturing in June 2027 from a result ofdifferent lender and repaid the disposal ofexisting construction loan. The Company entered into an interest-rate cap agreement for the properties, the Company paid costs of approximately $22.6 million at closing to defease this loan, which was expensed as loss from extinguishment of debt in the second quarter 2021. See Note 3-Recent Transactions.(i) In November 2020, the Company modified this mortgage loan, extending the maturity date from February 2021 to November 2027.loan.(j)(h)Effective rate reflects the first five years of interest payments at a fixed rate. Interest payments after that period ends are based on LIBOR plus 2.75% annually.(k)(i)The loan was modified to defer interest and principal payments for a six month period ending December 31, 2020. As of SeptemberJune 30, 2021,2022, deferred interest of $0.8 million has been added to the principal balance.(l)In December 2020, the Company obtained a new $72 million mortgage loan collateralized by the Emery that matures on January 1, 2031 and received net loan proceeds of $10.4 million after repaying its construction loan.(m)If the Company does not refinance the mortgage, it expects to pay it down at maturity using borrowings on the revolving credit facility.ninesix months ended SeptemberJune 30, 2022 and 2021 was $37.0 million and 2020 was $66,755,000 and $72,874,000$48.5 million (of which $1,699,000zero and $3,862,000$1.3 million pertained to properties classified as discontinued operations), respectively. Interest capitalized by the Company for the ninesix months ended SeptemberJune 30, 2022 and 2021 was $10.5 million and 2020 was $23,645,000 and $18,658,000,$16.4 million, respectively (which amounts included $338,000zero and $1,017,000$0.3 million for the ninesix months ended SeptemberJune 30, 20212022 and 2020,2021, respectively, of interest capitalized on the Company’s investments in unconsolidated joint ventures which were substantially in development).SUMMARY OF INDEBTEDNESS
(dollars in thousands) June 30,
2022December 31,
2021 Balance Balance Fixed Rate Debt $ 1,526,912 3.70 % $ 1,675,353 3.71 % Revolving Credit Facility & Other Variable Rate Debt (a) 700,577 3.72 % 713,717 3.32 % Totals/Weighted Average: $ 2,227,489 3.70 % $ 2,389,070 3.60 % As of September 30, 2021, the Company’s total indebtedness of $2,374,947,000 (weighted average(a) Includes debt with interest rate caps outstanding with a notional amount of 3.61 percent) was comprised of $696,048,000 of revolving credit facility borrowings and other variable rate mortgage debt (weighted average rate of 3.36 percent) and fixed rate debt and other obligations of $1,678,899,000 (weighted average rate of 3.72 percent).$185 million.As of December 31, 2020, the Company’s total indebtedness of $2,801,797,000 (weighted average interest rate of 3.76 percent) was comprised of $427,419,000 of revolving credit facility borrowings and other variable rate mortgage debt (weighted average rate of 3.38 percent) and fixed rate debt and other obligations of $2,374,378,000 (weighted average rate of 3.83 percent). 11.10. EMPLOYEE BENEFIT 401(k) PLANSMack-Cali Realty CorporationVeris Residential, Inc. 401(k) Savings/Retirement Plan (the “401(k) Plan”). Eligible employees may elect to defer from 1 percent up to 60 percent of their annual compensation on a pre-tax basis to the 401(k) Plan, subject to certain limitations imposed by federal law. The amounts contributed by employees are immediately vested and non-forfeitable. The Company may make discretionary matching or profit sharing contributions to the 401(k) Plan on behalf of eligible participants in any plan year. Participants are always 100 percent vested in their pre-tax contributions and will begin vesting in any matching or profit sharing contributions made on their behalf after two years of service with the Company at a rate of 20 percent per year, becoming 100 percent vested after a total of six years of service with the Company. All contributions are allocated as a percentage of compensation of the eligible participants for the Plan year. The assets of the 401(k) Plan are held in trust and a separate account is established for each participant. A participant may receive a distribution of his or her vested account balance in the 401(k) Plan in a single sum or in installment payments upon his or her termination of service with the Company. Total expense recognized by the Company for the 401(k) Plan for the threeSeptemberJune 30, 2022 and 2021 was $148 thousand and 2020 was $158,000 and $199,000,$158 thousand, respectively and $496,000$330 thousand and $630,000$338 thousand for the ninesix months ended SeptemberJune 30, 2022 and 2021, and 2020, respectively.12.11. DISCLOSURE OF FAIR VALUE OF ASSETS AND LIABILITIESSeptemberJune 30, 20212022 and December 31, 2020.2021. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts.SeptemberJune 30, 20212022 and December 31, 2020.senior unsecured notes, revolving credit facility and term loan and mortgages, loans payable and other obligations aggregated approximately $2,399,631,000$2.1 billion and $2,879,002,000$2.4 billion as compared to the book value of approximately $2,374,947,000$2.2 billion and $2,801,797,000$2.4 billion as of SeptemberJune 30, 20212022 and December 31, 2020,2021, respectively. The fair value of the Company’s long-term debt was categorized as avalued using level 3 basisinputs (as provided by ASC 820, Fair Value Measurements and Disclosures). The fair value was estimated using a discounted cash flow analysis valuation based on the borrowing rates currently available to the Company for loans with similar terms and maturities. The fair value of the mortgage debt and the unsecured notes was determined by discounting the future contractual interest and principal payments by a market rate. Although the Company has determined that the majority of the inputs used to value its derivative financial instruments fall within level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivative financial instruments utilize level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by itself and its counterparties. The Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its derivative financial instruments. As a result, the Company has determined that its derivative financial instruments valuations in their entirety are classified in level 2 of the fair value hierarchy.estimatedcontractual cash flows available from one of the properties of the Metropark portfolio.total receivable. The Company accordingly recorded a loan loss allowance charge of $5.2 million$110 thousand at SeptemberJune 30, 2021,2022, which iswas deducted from the amortized cost basis of the note receivable. Such charge was recorded in Interest and other investment income (loss) for the three and ninesix months ended SeptemberJune 30, 2021.2022. See Note 5: Deferred charges goodwill and other assets, net.third partythird-party broker information and information from potential buyers, as applicable.SeptemberJune 30, 2021,2022, assumptions that were utilized in the fair value calculation included:
Techniques
Assumptions
Type
RatesDescriptionTechniquesAssumptionsTypeRatesOffice properties held for sale and held and used on which the Company recognized impairment losses or unrealized allowance reversalsSale prices per purchase and sale agreements, discounted cash flows and direct capitalizationDiscount ratesSuburban10%Waterfront8%Capitalization ratesSuburban8.5% - 9.25%Waterfront4.8% - 5.75%Market rental rates per square footSuburban$34.50Waterfront$48.00 - $51.00Market rates per square footSuburban$12.0060,00076,000 - $85,000Suburban$43,000 - $54,0003as held for sale 2 office properties (comprised of 3 disposal groups), a small retail pad leased to otherstotaling approximately 1.6 million square feet and several developable land parcels, as held for sale as of September 30, 2021 with an aggregate carrying value of $497.8 million.which are located in Jersey City, Holmdel, Morris Township, Wall and Weehawken, New Jersey. As a result of recent sales contracts in place, and after considering the current market conditions as a result of the challenging economic climate with the current worldwide COVID-19 pandemic, the Company determined that the carrying value of 21 of the remaining held for sale office properties and a2 land parcelparcels held for sale (totaling $193.8 million) was not expected to be recovered from estimated net sales proceeds, and accordingly, during the three and six months ended June 30, 2022, recognized an unrealized held for sale loss allowance of $3.0$4.4 million (all of which is included in discontinued operations) and $3.5 million for the properties andalso recorded land and other impairments of $0.3$3.9 million and $0.7 million, during the three and nine months ended September 30, 2021respectively. As a result of a recent sales contract in place for a land parcel held for sale, the Company recognized an unrealized gain of $3.7 million during both the three and nine months ended September 30, 2021 (reversing cumulative held for sale loss allowances recognized), resulting in a carrying value of $24.6 million.of ownership which occurred during the second quarter 2021, the Company evaluated the recoverability of the carrying value of its office property in Hoboken, New Jersey, and determined thatfor several land parcels, it was necessary to reduce the carrying value of the propertythese assets to itstheir estimated fair value.values. Accordingly, the Company recorded an impairment charge of $6.0$2.9 million on the office property at June 30, 2021, which is includedland parcels in propertyland and other impairments on the consolidated statement of operations. Also, as a result of the Company’s shortening of its expected holding period beginning in the second quarter 2021, the Company evaluated the recoverability of the carrying values of its land parcels and determined that it was necessary to reduce the carrying value of a held-and-used land parcel to its estimated fair value of $60.0 million at September 30, 2021 and recorded land and other impairment charges of $6.8 million and $14.3 million, respectively,operations for the three and ninesix months ended SeptemberJune 30, 2021.SeptemberJune 30, 20212022 and December 31, 2020.2021. Although management is not aware of any factors that would significantly affect the fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since SeptemberJune 30, 20212022 and current estimates of fair value may differ significantly from the amounts presented herein.slowedimpacted global economic activity and caused significantcontinues to cause volatility in financial markets. As such, there is currently significant uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. economy. The current economic environment can and will be significantly adversely affected by many factors beyond the Company’s control. The extent to which COVID-19 impacts the Company’s fair value estimates in the future will depend on developments going forward, many of which are highly uncertain and cannot be predicted. In consideration of the magnitude of such uncertainties under the current climate, management has considered all available information at its properties and in the marketplace to provide its estimates as of SeptemberJune 30, 2021. 2022.13.12. COMMITMENTS AND CONTINGENCIESProperty Name Location Asset Type PILOT
Expiration DatesPilot Payments Three Months Ended
June 30,Pilot Payments Six Months Ended
June 30,2022 2021 2022 2021 (Dollars in Thousands) (Dollars in Thousands) BLVD 475 (Monaco) (a) Jersey City, NJ Multifamily 2/2021 $ — $ — $ — $ 474 111 River Street (b) Hoboken, NJ Office 4/2022 — 370 85 739 Harborside Plaza 4A (c) Jersey City, NJ Office 2/2022 — 264 218 528 Harborside Plaza 5 (d) Jersey City, NJ Office 6/2022 1,109 1,080 2,217 2,159 BLVD 401 (Marbella 2) (e) Jersey City, NJ Multifamily 4/2026 376 327 735 587 RiverHouse 11 at Port Imperial (f) Weehawken, NJ Multifamily 7/2033 356 416 706 668 Port Imperial 4/5 Hotel (g) Weehawken, NJ Hotel 12/2033 733 536 1,466 1,071 RiverHouse 9 at Port Imperial (h) Weehawken, NJ Multifamily 6/2046 318 — 640 — Haus25 (i) Jersey City, NJ Mixed-Use 3/2047 124 — 124 — Total Pilot taxes $ 3,016 $ 2,993 $ 6,191 $ 6,226 Harborside Plaza 4-A agreement withannual PILOT is equal to 10 percent of Gross Revenues, as defined.Cityfirst quarter of Jersey City, as amended, which commenced in 2002, is for a term of 20 years. 2022.TotalThe total Project Costs are $49.5 million. The PILOT totaled $266,000 and $264,000 for the three months ended September 30, 2021 and 2020, respectively, and $794,000 and $792,000 for the nine months ended September 30, 2021 and 2020, respectively.The Harborside Plaza 5 agreement, also with the City of Jersey City, as amended, which commenced in 2002, is for a term of 20 years. The annual PILOT is equal to 2 percent of Total Project Costs, as defined. TotalThe total Project Costs are $170.9 million. The PILOT totaled $1.1 million and $1.1 million for the three months ended September 30, 2021 and 2020, respectively, and $3.2 million and $3.2 million for the nine months ended September 30, 2021 and 2020, respectively.Port Imperial South 1/3 Garage development project agreement with the Cityannual PILOT is equal to 10 percent of Weehawken has a termGross Revenues for years 1-4, 12 percent for years 5-8 and 14 percent for years 9-10, as defined.fiveGross Revenues for years beginning when the project is substantially complete, which occurred in the fourth quarter of 2015. The agreement provides that real estate taxes be paid at 1001-5, 13 percent on the land value of the project only over the five year periodfor years 6-10 and allows14 percent for a phase in of real estate taxes on the building improvement value at zero percent in year 1 and 95 percent in years two through five. The agreement expired in December 31, 2020.11-15, as defined.The Port Imperial Hotel development project agreement with the City of Weehawken is for a term of 15 years following substantial completion, which occurred in December 2018. The annual PILOT is equal to 2 percent of Total Project Costs, as defined therein. The PILOT totaled $1.0 million and $0.5 million for the three months ended September 30, 2021 and 2020, respectively, and $2.2 million and $1.6 million for the nine months ended September 30, 2021 and 2020, respectively.defined.The Port Imperial South 11 development project agreement with the City of Weehawken is for a term of 15 years following substantial completion, which occurred in August 2018. The annual PILOT is equal to 10 percent of Gross Revenues, as defined therein. The PILOT totaled $0.3 million and $0.3 million for the three months ended September 30, 2021 and 2020, respectively, and $1.0 million and $0.9 million for the nine months ended September 30, 2021 and 2020, respectively.The 111 River Realty agreement with the City of Hoboken, which commenced on October 1, 2001 expires in April 2022. The PILOT payment equaled $1.2 million annually through April 2017 and then increased to $1.4 million annually until expiration. The PILOT totaled $0.4 million and $0.4 million for the three months September 30, 2021 and 2020, respectively, and $1.1 million and $1.1 million for the nine months ended September 30, 2021 and 2020, respectively.The BLVD 475 agreement with the City of Jersey City, which commenced in 2011, is for a term of 10 years (expired in February 2021). The annual PILOT is equal to 10 percent of gross revenues, as defined. The PILOT totaled 0 and $0.3 million for the three months ended September 30, 2021 and 2020, respectively, and $0.5 million and $1.4 million for the nine months ended September 30, 2021 and 2020, respectively.The BLVD 401 agreement with the City of Jersey City, which commenced in 2016, is for a term of 10 years. The annual PILOT is equal to 10 percent of gross revenues for years 1-4, 12 percent of gross revenues for years 5-8 and 14 percent of gross revenue for years 9-10, as defined therein. The PILOT totaled $0.4 million and $0.2 million for the three months ended September 30, 2021 and 2020, respectively and $1.0 million and $0.8 million for the nine months ended September 30, 2021 and 2020, respectively.The Port Imperial Parcel South 9 development project agreement with the City of Weehawken is for a term of 25 years following substantial completion, which is anticipated to occur in the third quarter 2021. The annual PILOT is equal to 11 percent of gross revenueGross Revenues for years 1-10, 12.5 percent for years 11-18 and 14 percent for years 19-25, as defined therein.defined.The Port Imperial South Park Parcel development project agreement with the Township of Weehawken is forFor a term of 25 years following substantial completion. The project is anticipated to begin construction in late 2021 with substantial completion, in 2024.which occurred on April 1, 2022. The annual PILOT is equal to 107 percent of Gross Revenues, as defined therein.defined.LITIGATIONSeptemberJune 30, 20212022 and December 31, 2020,2021, are as follows (dollars in thousands):Year July 1 through December 31, 2022 $ 96 2023 192 2024 192 2025 199 2026 199 2027 through 2101 31,864 Total lease payments 32,742 Less: imputed interest (29,540) Total $ 3,202 Year 2022 $ 1,695 2023 1,702 2024 1,721 2025 1,728 2026 1,728 2027 through 2101 151,253 Total lease payments 159,827 Less: imputed interest (136,141) Total $ 23,686 $533,000$214 thousand and $473,000$380 thousand for the three months ended SeptemberJune 30, 20212022 and 2020,2021, respectively and $1.9 million$562 thousand and $1.8 million$640 thousand for the ninesix months ended SeptemberJune 30, 2022 and 2021, and 2020, respectively.$22.3$2.9 million at SeptemberJune 30, 20212022 for 32 ground leases. Such amount represents the net present value (“NPV”) of future payments detailed above. The incremental borrowing ratesrate used to arrive at the NPV ranged from 7.576 percent towas 7.618 percent for the remaining ground lease terms ranging from 80.83of 82.58 years to 82.58 years.each. These rates were arrived at by adjusting the fixed rates of the Company’s mortgage debt with debt having terms approximating the remaining lease term of the Company’s ground leases and calculating notional rates for fully-collateralized loans.CONSTRUCTION PROJECTSThe Company is developing a 750-unit multi-family project at 25 Christopher Columbus, also known as Haus 25, in Jersey City, New Jersey, which began construction in2019. The construction project, which is estimated to cost $469.5 million, of which $406.8 million has been incurred through September 30, 2021, is expected to be ready for occupancy in first quarter 2022. The Company has funded $169.5 million of the construction costs, and the remaining construction costs are expected to be funded from a $300 million construction loan (of which $237.3 million was drawn as of September 30, 2021).MANAGEMENT CHANGESOn March 3, 2021,2022, the Company announced a number of management changes. Effective, January 12, 2022, the Company terminated the employment of its Chief Accounting Officer, Mr. Giovanni M. DeBari, and appointed Ms. Amanda Lombard in his place. In addition, the Company also disclosed that its Board of Directors had appointed Mahbod Nia as Chief ExecutiveFinancial Officer, of the Company. The appointment was effective as of March 8, 2021 (the “CEO Effective Date”).The Company’s Board approved andDavid Smetana, would leave the Company entered into an employment agreement dated March 2, 2021 with Mr. Nia (the “CEO Employment Agreement”) that provides as follows: ·An initial term of three years, commencing on the Effective Date, subject to automatic annual renewals thereafter unless earlier terminated; An annual base salary of $800,000, subject to potential merit increases (but not decreases) each year; a target annual bonus opportunity of 150% of base salary (the “Target Bonus”), with a threshold bonus of 50% of the Target Bonus, and a maximum bonus of 200% of the Target Bonus, based on performance goals to be established annually by the Compensation Committee. On March 10, 2021 Mr. Nia was granted a one-time sign-on “inducement” award of 950,000 stock options to purchase the Company’s common stock, at an exercise price equal to the closing price of the common stock on the date of grant, which will vest and become exercisable in three substantially equal installments on each of the first 3 anniversaries following the date of grant (the “Sign-On Award”). Each calendar year while Mr. Nia is employed (including 2021), Mr. Nia will be eligible for an annual equity award under the Company’s then-current equity incentive plan with an aggregate grant date fair value of $4,000,000. One-half of each annual equity award will vest subject to time-based vesting conditions, and one-half of each annual equity award will vest subject to performance-based vesting conditions.· In addition to standard employee benefits (including health coverage for Mr. Nia and his dependents in the U.S. and the U.K, not to exceed a cost to the Company of $25,000 per year), Mr. Nia will receive up to $30,000 per year in tax compliance assistance, reimbursement of attorneys’ fees in connection with negotiating the Employment Agreement up to $100,000, and, in the event that Mr. Nia relocates his principal residence to the Jersey City, New Jersey metropolitan area, reimbursement for relocation costs up to $50,000 in the aggregate.Under the CEO Employment Agreement, Mr. Nia will be subject to certain restrictive covenants, including non-competition and non-solicitation covenants during his employment and for one year following termination of employment, and perpetual confidentiality and non-disparagement covenants. Concurrent with the appointment of Mr. Nia as Chief Executive Officer, MaryAnne Gilmartin’s tenure as interim Chief Executive Officer of the Company ended as of the CEO Effective Date.In connection with Ms. Gilmartin’s appointment, as interim Chief Executive Officer effective as of July 25, 2020, the Company entered into a letter agreement (the “Letter Agreement”) with MAG Partners 2.0 LLC (“MAG Partners”), an entity wholly owned by Ms. Gilmartin. Pursuant to the Letter Agreement, MAG Partners agreed to make Ms. Gilmartin’s services available to the Company to serve as its interim Chief Executive Officer. The term of this arrangement and Ms. Gilmartin’s appointment as interim Chief Executive Officer (the “Term”) was to continue until the earliest to occur of (i) the commencement of employment of a permanent Chief Executive Officer of the Company, (ii) a period of six months has elapsed, or an earlier or later date selected by the Board, and (iii) Ms. Gilmartin’s death or disability, or the termination of the arrangement by MAG Partners (including a resignation by Ms. Gilmartin of her appointment as interim Chief Executive Officer). OnJanuary 22, 2021, the Company entered into a six -month extension (the “Extension Letter”) of the Letter Agreement with MAG Partners, pursuant to which MAG Partners made Ms. Gilmartin’s services available to the Company to serve as its interim Chief Executive Officer. Pursuant to the Extension Letter, the term of the Letter Agreement was extended until July 25, 2021 (the “Extended Term”). However, Ms. Gilmartin’s appointment as interim Chief Executive Officer was to end upon the earlier to occur of (x) the commencement of employment of a permanent Chief Executive Officer of the Company or (y) a date selected by the Board of Directors of the Company, and during any remaining portion of the Extended Term, MAG Partners would continue to make Ms. Gilmartin reasonably available to assist with the transition of Ms. Gilmartin’s duties to her successor and with any other matters that the Company may reasonably request. In addition, if the Extended Term ended at any time prior to July 25, 2021 (other than a termination by the Company for cause), then the Company would continue to pay MAG Partners its monthly $150,000 cash retainer fee through July 25, 2021.Pursuant to the Letter Agreement, during the Term the Company would pay to MAG Partners a monthly fee of $150,000, subject to proration for any partial month (but continuing for a minimum of three months following commencement of the Term if the Term is ended by the Board for any reason other than for “cause”). MAG Partners was also eligible to receive a one-time cash sign-on bonus of $300,000 and, unless the Term is ended by the Board for “cause,” a one-time completion bonus of $200,000 at the end of 2022, and that Ms. Lombard would assume the Term (but no later thanrole of CFO at his departure. Mr. Smetana subsequently decided to leave the Company effective March 12, 2021, when it was paid). 31, 2022. Ms. Lombard will serve as both principal financial officer and principal accounting officer.granted to MAG Partners fully vested stock options to purchase up to 230,000 sharesterminated the employment of common stock with an exercise price of $14.39 per share, and up to 100,000 shares of common stock with an exercise price of $20.00 per share, pursuant to a Stock Option Agreement by and between MAG Partners and the Company (the “Option Agreement”), of which 157,505 of the options were issued after shareholder approval at the Company’s 2021 Annual Meeting of Stockholders.On June 9, 2021, the Company, appointed Anna Malhari asits Executive Vice President and Chief OperatingInvestment Officer of the Company. The appointment wasRicardo Cardoso effective as of June 9, 2021 (the “Effective Date”).The Company entered into, an amended and restated employment agreement dated as of June 9, 2021 with Ms. Malhari (the “Malhari Employment Agreement”) that provided as follows:An initial term ending December 31, 2023, commencing on the Effective Date, subject to automatic annual renewals thereafter unless earlier terminated;An annual base salary of $300,000, subject to potential merit increases (but not decreases) each year;A target annual bonus opportunity of 100% of base salary (the “Target Bonus”), with a threshold bonus of 50% of the Target Bonus, and a maximum bonus of 150% of the Target Bonus, based on performance goals to be established annually by the Compensation Committee;Promptly following the Effective Date, Ms. Malhari will be granted a one-time long-term incentive compensation award with a grant date fair value of $100,000, with 50% of such award subject to time-based vesting conditions and 50% of such award subject to performance-based vesting conditions;Upon a termination without “cause” (as defined in the Employment Agreement) or by Ms. Malhari for “good reason” (as defined in the Employment Agreement), subject to execution of a release of claims, Ms. Malhari will be entitled to (i) cash severance equal to 1.5 times (the “Multiplier”) the sum of her base salary and Target Bonus, paid in a lump sum as soon as practicable following the date of termination, but, if such termination occurs within the period commencing 3 months prior to a “change in control” (as defined in the Malhari Employment Agreement) and ending one year following a “change in control,” the Multiplier will increase to 2.0 times; (ii) up to 18 months of continued medical coverage for Ms. Malhari and her dependents; (iii) accelerated vesting of time-based equity awards; and (iv) eligibility to vest in a prorated amount of outstanding performance-based equity awards, based on the amount of time Ms. Malhari remained employed during the applicable performance period and actual performance over the applicable performance period.Under the Malhari Employment Agreement, Ms. Malhari will be subject to certain restrictive covenants, including non-competition and non-solicitation covenants during her employment and for one year following termination of employment, and perpetual confidentiality and non-disparagement covenants.On May 13, 2021, the Company determined that effective May 13, 2021, Marshall Tycher would step down as an executive officer and employee of the Company. Mr. Tycher will serve in a consulting role as a senior advisor to the Company from May 14, 2021 through November 14,April 1, 2022 (the “Consulting Term”). The transitioning of Mr. Tycher to a senior advisor role is in furtherance of the Company’s strategic transformation with a focus on further simplification of the Company and realization of operational efficiencies that the Company believes will result in a streamlined organizational architecture that management anticipates will result in financial and operational benefits to the Company.In connection with Mr. Tycher’s separation from the Company, Mr. Tycher entered into a separation and release agreement with the Company dated May 19, 2021 (the “Release”) and a separate Consulting and Cooperation Agreement dated as of May 13, 2021 between the Company and Mr. Tycher (the “Consulting Agreement”). Mr. Tycher’s separation from the Company has been deemed a termination without cause under the terms and conditions of Mr. Tycher’s existing employment agreement dated April 26, 2017 (the “Employment Agreement”).Under the terms of the Release Agreement, and consistent with the terms of the Employment Agreement and the relevant award agreements, Mr. Tycher will:immediately vest in 29,230 previously earned but unvested performance-based long-term incentive plan units (“LTIP Units”);immediately vest in 31,963 unvested time-based LTIP Unitsemployment of its Executive Vice President, General Counsel and 1,162 time-vesting restricted stock units (“RSUs”) previously grantedSecretary Gary T. Wagner effective April 15, 2022. It has appointed Jeff Turkanis and Taryn Fielder to Mr. Tycher;be eligible to vest in a maximum of 162,290 performance-based LTIP Units and 2,153 performance-vesting RSUs previously granted to Mr. Tycher, subject to the achievement of applicable performance criteria over the performance period applicable under the award agreements governing such LTIP Units and RSUs; andimmediately forfeit 101,625 performance-based LTIPs and 48,960 PRSUs previously granted to Mr. Tycher.Mr. Tycher otherwise is eligible to receive the severance payments and benefits upon a termination without cause (outside of a change in control) under his Employment Agreement described under the heading “Employment Contracts; Potential Payments Upon Termination or Change in Control—Marshall B. Tycher Employment Agreement,” as set forth in the Company’s definitive proxy statement filed with the Securities and Exchange Commission on April 28, 2021, which descriptions are incorporated by reference herein.Under the terms of the Consulting Agreement, Mr. Tycher will:provide certain consulting, cooperation and transition services to the Company and general support, oversight and development services for the Company’s multi-family operations;receive a monthly consulting fee of $33,334 during the first twelve (12) months of the Consulting Term;be eligible to receive, upon and subject to the occurrence of thirteen separate milestone events to the extent each such milestone event may occur during the Consulting Term, a success fee ranging from $50,000 to $150,000 per milestone, up to a maximum aggregate of $1,250,000 if all milestones are achieved during the Consulting Term;be eligible for continued vesting in 12,720 time-based LTIP Units and 54,155 time-vesting RSUs previously granted to Mr. Tycher, subject to Mr. Tycher’s performance of the Consulting Agreement through the end of the Consulting Term;be eligible for continued vesting in a maximum of 72,688 performance-based LTIP Units previously granted to Mr. Tycher, subject to Mr. Tycher’s performance of the Consulting Agreement through the end of the Consulting Term and the achievement of applicable performance criteria over the performance period applicable under the award agreements governing such LTIP Units; andbe eligible for continued vesting in 18,387 performance-based LTIP Units and 51,393 performance-vesting RSUs previously granted to Mr. Tycher, in each case subject to Mr. Tycher’s achievement of certain performance milestones set forth in the Consulting Agreement and the achievement of the applicable performance criteria over the performance period applicable under the award agreements governing such LTIP Units and RSUs.SeptemberJune 30, 2021,2022, the Company’s total costs incurred net of LTIP forfeitures, relating to the management restructuring activities discussed above, including the severance and related costs for the departure of the Company’s terminated employees, amounted to $0.4 million (which was included in general and administrative expense). During the nine months ended September 30, 2021, the Company’s total costs incurred, net of LTIP forfeitures, relating to the management restructuring activitieschanges discussed above, including the severance and related costs for the departure of the Company’s former executive officer and the departure of the Company’s former interim chief executive officer,officers, as well as other terminated employees, amounted to $10.6$1.2 million ($8.8and $8.8 million, ofrespectively, which was included in general and administrative expense and $1.8 million of which was included in operating services expense).expense.
Through February 2016, thecould not dispose of or distribute certain of its properties which were originally contributedacquired by certaincontribution from unrelated common unitholders of the Operating Partnership, without the express written consent of such common unitholders, as applicable,were subject to restrictions on disposition, except in a manner which did not result in recognition of any built-in-gain (which may result in an income tax liability)allocable to such unitholders or which reimbursed the appropriate specific common unitholders for the tax consequences of the recognition of such built-in-gainsthereof (collectively, the “Property Lock-Ups”). Upon the expiration in February 2016 of theWhile these Property Lock-Ups, have expired, the Company is generally required to use commercially reasonable efforts to prevent any sale, transfer or other disposition of the subject properties from resulting in the recognition of built-in gain to the specific commonthese unitholders, which include members of the Mack Group (which includes William L. Mack, a former director;director and David S. Mack, a former director; and Earle I. Mack, a former director), the Robert Martin Group, and the Cali Group (which includes John R. Cali, a former director).director. As of SeptemberJune 30, 2021, after the effects of2022, taking into account tax-free exchanges on certain of the originally contributed properties, either wholly or partially, over time, 5 of the Company’s properties, as well as certain land and development projects, including properties classified as held for sale as of SeptemberJune 30, 2021,2022, with an aggregate carrying value of approximately $1.0 billion, are subject to these conditions.October 2021,June 30, 2022, the Company has outstanding stay-on award agreements with 3632 employees, which provides them with the potential to receive compensation, in cash or Company stock at the employees’ option, contingent upon remaining with the Company in good standing until the occurrence of certain corporate transactions, which have not been identified. The total potential cost of such awards is currently estimated to be up to approximately $5.2$1.7 million, including the potential future issuance of up to 82,62967,981 shares of the Company’s common stock. Such cash or stock awards would only be earned and payable if such transaction was identified and communicated to the employee within seven years of the agreement dates, all of which all occurredwere signed in late 2020 and early 2021, and all other conditions were satisfied.In September 2020, the General Partner's Board of Directors approved a discretionary reimbursement of approximately $6.1 million in fees and expenses incurred by Bow Street LLC in connection with its proxy solicitations in 2019 and 2020 that resulted in the election of Bow Street's nominees as directors of the General Partner at the 2019 and 2020 annual meetings of stockholders of the General Partner. The Board of Directors determined that the reimbursement was appropriate in light of the benefit to the General Partner and its stockholders of the refreshment of the Board of Directors that resulted from the proxy contests. The Company reimbursed this amount to Bow Street in 3 substantially equal payments in November 2020, January 2021 and April 2021. The Company recorded the full $6.1 million as general and administrative expense in the year ended December 31, 2020 when the obligation was committed to. Bow Street is an affiliate of A. Akiva Katz, a director of the General Partner, who is a co-founder and managing partner of Bow Street.14.13. TENANT LEASES2042.2038. Substantially all of the commercial leases provide for annual base rents plus recoveries and escalationpass-throughpass-through of charges for electrical usage.SeptemberJune 30, 20212022 and December 31, 20202021 are as follows (dollars in thousands):Year July 1 through December 31, 2022 July 1 through December 31, 2022 $ 45,735 2023 90,521 2024 80,735 2025 77,227 2026 2026 74,513 2027 and thereafter 2027 and thereafter 381,764 Total $ 750,495 Year 2022 $ 115,256 2023 114,355 2024 98,374 2025 94,042 2026 2026 91,297 2027 and thereafter 2027 and thereafter 416,712 Total $ 930,036 Multi-family15. 14. REDEEMABLE NONCONTROLLING INTERESTS (“RRT”), the Company’s subsidiary through which the Company conducts its multi-familymultifamily residential real estate operations, Veris Residential Partners, L.P. (“VRLP”), formerly known as Roseland Residential, L.P. (“RRLP”), the operating partnership through which RRTVRT conducts all of its operations, and certain other affiliates of the Company entered into a preferred equity investment agreement (the “Original Investment Agreement”) with certain affiliates of Rockpoint Group, L.L.C. (Rockpoint Group, L.L.C. and its affiliates, collectively, “Rockpoint”). The Original Investment Agreement provided for RRTRRLPVRLP in exchange for common units of limited partnership interests in RRLPVRLP (the “Common Units”) and for multiple equity investments by Rockpoint in RRLPVRLP from time to time for up to an aggregate of $300 million of preferred units of limited partnership interests in RRLPVRLP (the “Preferred Units”). The initial closing under the Original Investment Agreement occurred on March 10, 2017 for $150 million of Preferred Units and the parties agreed that the Company’s contributed equity value (“RRTVRT Contributed Equity Value”), was $1.23$1.23 billion at closing. During the year ended December 31, 2018, a total additional amount of $105$105 million of Preferred Units were issued and sold to Rockpoint pursuant to the Original Investment Agreement. During the threesix months ended March 31,June 30, 2019, a total additional amount of $45$45 million of Preferred Units were issued and sold to Rockpoint pursuant to the Original Investment Agreement, which brought the$300 million.$300 million. In addition, certain contributions of property to RRLPVRLP by RRTVRT subsequent to the execution of the Original Investment Agreement resulted in RRTVRT being issued approximately $46 million of Preferred Units and Common Units in RRLPVRLP prior to June 26, 2019.RRT, RRLP,VRT, VRLP, certain other affiliates of the Company and Rockpoint entered into an additional preferred equity investment agreement (the “Add On Investment Agreement”). The closing under the Add On Investment Agreement occurred on June 28, 2019. Pursuant to the Add On Investment Agreement, Rockpoint invested an additional $100 million in Preferred Units and the Company and RRTVRT agreed to contribute to RRLPVRLP 2 additional properties located in Jersey City, New Jersey. The Company used the $100 million in proceeds received to repay outstanding borrowings under its unsecured revolving credit facility and other debt by June 30, 2019. In addition, Rockpoint has a right of first refusal to invest another $100 million in Preferred Units in the event RRTVRT determines that RRLPVRLP requires additional capital prior to March 1, 2023 and, subject thereto, RRLPVRLP may issue up to approximately $154 million in Preferred Units to RRTVRT or an affiliate so long as at the time of such funding RRTVRT determines in good faith that RRLPVRLP has a valid business purpose to use such proceeds. Included in general and administrative expenses for the year ended December 31, 2019 were $371,000$371 thousand in fees associated with the modifications of the Original Investment Agreement, which were made upon signing of the Add On Investment Agreement.RRLPVRLP will be distributable to Rockpoint and RRTVRT as follows:•first, to provide a 6% annual return to Rockpoint and RRTVRT on their capital invested in Preferred Units (the “Preferred Base Return”);•second, 95.36% to RRTVRT and 4.64% to Rockpoint until RRTVRT has received a 6% annual return (the “RRT“VRT Base Return”) on the equity value of the properties contributed by it to RRLPVRLP in exchange for Common Units (previously 95% and 5%, respectively, under the Original Investment Agreement), subject to adjustment in the event RRTVRT contributes additional property to RRLPVRLP in the future; and•third, pro rata to Rockpoint and RRTVRT based on total respective capital invested in and contributed equity value of Preferred Units and Common Units (based on Rockpoint’s $400 million of invested capital at SeptemberJune 30, 2021,2022, this pro rata distribution would be approximately 21.89% to Rockpoint in respect of Preferred Units, 2.65% to RRTVRT in respect of Preferred Units and 75.46% to RRTVRT in respect of Common Units).RRLP’sRRLPVRLP to Rockpoint and RRTVRT as follows:•first, to Rockpoint and RRTVRT to the extent there is any unpaid, accrued Preferred Base Return;•second, as a return of capital to Rockpoint and to RRTVRT in respect of Preferred Units;•third, 95.36% to RRTVRT and 4.64% to Rockpoint until RRTVRT has received the RRTVRT Base Return in respect of Common Units (previously 95% and 5%, respectively, under the Original Investment Agreement), subject to adjustment in the event RRTVRT contributes additional property to RRLPVRLP in the future;•fourth, 95.36% to RRTVRT and 4.64% to Rockpoint until RRTVRT has received a return of capital based on the equity value of the properties contributed by it to RRLPVRLP in exchange for Common Units (previously 95% and 5%, respectively, under the Original Investment Agreement), subject to adjustment in the event RRTVRT contributes additional property to the capital of RRLPVRLP in the future;•fifth, pro rata to Rockpoint and RRTVRT based on respective total capital invested in and contributed equity value of Preferred and Common Units until Rockpoint has received an 11% internal rate of return (based on Rockpoint’s $400 million of invested capital at SeptemberJune 30, 2021,2022, this pro rata distribution would be approximately 21.89% to Rockpoint in respect of Preferred Units, 2.65% to RRTVRT in respect of Preferred Units and 75.46% to RRTVRT in respect of Common Units); and•sixth, to Rockpoint and RRTVRT in respect of their Preferred Units based on 50% of their pro rata shares described in “fifth” above and the balance to RRTVRT in respect of its Common Units (based on Rockpoint’s $400 million ofSeptemberJune 30, 2021,2022, this pro rata distribution would be approximately 10.947% to Rockpoint in respect of Preferred Units, 1.325% to RRTVRT in respect of Preferred Units and 87.728% to RRTVRT in respect of Common Units).RRLPVRLP may not sell its properties in taxable transactions, although it may engage in tax-deferred like-kind exchanges of properties or it may proceed in another manner designed to avoid the recognition of gain for tax purposes.RRTVRT increased the size of its board of trustees from 6 to 7 persons, with 5 trustees being designated by the Company and 2 trustees being designated by Rockpoint.RRTVRT and RRLPVRLP are required to obtain Rockpoint’s consent with respect to:•debt financings in excess of a 65% loan-to-value ratio;•corporate level financings that are pari-passu or senior to the Preferred Units;•new investment opportunities to the extent the opportunity requires an equity capitalization in excess of 10% of RRLP’sVRLP’s NAV;•new investment opportunities located in a Metropolitan Statistical Area where RRLPVRLP owns no property as of the previous quarter;•declaration of bankruptcy of RRT;VRT;•transactions between RRTVRT and the Company, subject to certain limited exceptions;•any equity granted or equity incentive plan adopted by RRLPVRLP or any of its subsidiaries; and•certain matters relating to the Credit Enhancement Note (as defined below) between the Company and RRLPVRLP (other than ordinary course borrowings or repayments thereunder).RRLP.VRLP. The Credit Enhancement Note provides for an interest rate equal to the London Inter-Bank Offered Rate plus fifty (50) basis points above the applicable interest rate under the Company’s unsecured revolving credit facility. The maximum aggregate principal amount of advances at any one time outstanding under the Credit Enhancement Note is limited to $50 million, an increase of $25 million from the prior transaction.RRTRRLPVRLP also have agreed, as was the case under the Original Investment Agreement, to register the Preferred Units under certain circumstances in the future in the event RRTVRT or RRLPVRLP becomes a publicly traded company.RRLPVRLP or a sale of a majority of the then-outstanding interests in RRLP,VRLP, in each case, which sale is not approved by Rockpoint, or (b) a spin-out or initial public offering of common stock of RRT,VRT, or distributions of RRTVRT equity interests by the Company or its affiliates to shareholders or their respective parent interestholders (an acquisition pursuant clauses (a) or (b) above, an “Early Purchase”). RRTVRT has the right to acquire Rockpoint’s interest in the Preferred Units in connection with an Early Purchase for a purchase price generally equal to (i) the amount that Rockpoint would receive upon the sale of the assets of RRLPVRLP for fair market value and a distribution of the net sale proceeds in accordance with (A) the capital event distribution priorities discussed above (in the case of certain Rockpoint Preferred Holders) and (B) the distribution priorities applicable in the case of a liquidation of RRLPVRLP (in the case of the other Rockpoint Preferred Holder), plus (ii) a make whole premium (such purchase price, the “Purchase Payment”). The make whole premium is an amount equal to (i) $173.5 million until December 28, 2020, or $198.5 million thereafter, less distributions theretofore made to Rockpoint with respect to its Preferred Base Return or any deficiency therein, plus (ii) $1.5 million less certain other distributions theretofore made to Rockpoint.RRLP’sVRLP’s assets is determined by a third party appraisal of the net asset value (“NAV”) of RRLPVRLP and the fair market value of RRLP’sVRLP’s assets, to be completed within ninety (90) calendar days of March 1, 2023 and annually thereafter.RRTVRT may acquire from Rockpoint, or Rockpoint may sell to RRT,VRT, all, but not less than all, of Rockpoint’s interest in the Preferred Units (each, a “Put/Call Event”) for a purchase price equal to the Purchase Payment (determined without regard to the make whole premium and any related tax allocations). An acquisition of Rockpoint’sRRLPVRLP or any subsidiary of RRLPVRLP that may be offered for sale by RRLPVRLP or its subsidiaries from time to time. Upon a Put/Call Event, other than in the event of a sale of RRLP,VRLP, Rockpoint may elect to convert all, but not less than all, of its Preferred Units to Common Units in RRLP.SeptemberJune 30, 2021.2022. The Company determines the redemption value of these interests by hypothetically liquidating the estimated NAV of the RRTVRT real estate portfolio including debt principal through the applicable waterfall provisions of the new transaction with Rockpoint. The estimation of NAV includes unobservable inputs that consider assumptions of market participants in pricing the underlying assets of RRLP.VRLP. For properties under development, the Company applies a discount rate to the estimated future cash flows allocable to the Company during the period under construction and then applies a direct capitalization method to the estimated stabilized cash flows. For operating properties, the direct capitalization method is used by applying a capitalization rate to the projected net operating income. For developable land holdings, an estimated per-unit market value assumption is considered based on development rights or plans for the land. Estimated future cash flows used in such analyses are based on the Company’s business plan for each$466.3$484.4 million as of SeptemberJune 30, 2021.2022.
3.53.50 percent, or (y) the then-effective annual dividend yield on the General Partner’s common stock, and is convertible into 27.936 common units of limited partnership interests of the Operating Partnership beginning generally five years from the date of issuance, or an aggregate of up to 257,375 Common Units. The conversion rate was based on a value of $35.80 per common unit. The Series A-1 Units have a liquidation and dividend preference senior to the Common Units and include customary anti-dilution protections for stock splits and similar events. The Series A-1 Units are redeemable for cash at their stated value beginning five years from the date of issuance at the option of the holder. The Series A-1 Units are pari passu with the 42,800 3.5% Series A Units issued on February 3, 2017.SeptemberJune 30, 20212022 and 2020,2021, respectively (dollars in thousands):Series A and
A-1 Preferred
Units
In VRLPTotal
Redeemable
Noncontrolling
InterestsBalance at April 1, 2022 $ 40,302 $ 472,210 $ 512,512 Redemption/Payout — — — Redeemable Noncontrolling Interests Issued — — — Net 40,302 472,210 512,512 Income Attributed to Noncontrolling Interests 350 6,016 6,366 Distributions (350) (6,016) (6,366) Redemption Value Adjustment (71) 3,884 3,813 Balance at June 30, 2022 $ 40,231 $ 476,094 $ 516,325 Series A and
A-1 Preferred
Units
In VRLPRockpoint
Interests
in VRTTotal
Redeemable
Noncontrolling
InterestsBalance at April 1, 2021 $ 52,324 $ 462,943 $ 515,267 Redeemable Noncontrolling Interests Issued — — — Net 52,324 462,943 515,267 Income Attributed to Noncontrolling Interests 455 6,016 6,471 Distributions (455) (6,016) (6,471) Redemption Value Adjustment — 1,705 1,705 Balance at June 30, 2021 $ 52,324 $ 464,648 $ 516,972 Series A and
A-1 Preferred
Units
In VRLPTotal
Redeemable
Noncontrolling
InterestsBalance at January 1, 2022 $ 52,324 $ 468,989 $ 521,313 Redemption/Payout (12,000) — (12,000) Redeemable Noncontrolling Interests Issued — — — Net 40,324 468,989 509,313 Income Attributed to Noncontrolling Interests 771 12,032 12,803 Distributions (771) (12,032) (12,803) Redemption Value Adjustment (93) 7,105 7,012 Balance at June 30, 2022 $ 40,231 $ 476,094 $ 516,325 Series A and
A-1 Preferred
Units
In VRLP Rockpoint
Interests
in VRT Total
Redeemable
Noncontrolling
InterestsBalance at January 1, 2021 Balance at January 1, 2021 $ 52,324 $ 460,973 $ 513,297 Redeemable Noncontrolling Interests Issued — — — Net 52,324 460,973 513,297 Income Attributed to Noncontrolling Interests 910 12,032 12,942 Distributions (910) (12,032) (12,942) Redemption Value Adjustment — 3,675 3,675 Balance at June 30, 2021 Balance at June 30, 2021 $ 52,324 $ 464,648 $ 516,972 16.15. MACK-CALI REALTY CORPORATIONVERIS RESIDENTIAL, INC. STOCKHOLDERS’ EQUITY AND MACK-CALI REALTY,VERIS RESIDENTIAL, L.P.’S PARTNERS’ CAPITAL17:16: Noncontrolling Interests in Subsidiaries.ninethree and six months ended SeptemberJune 30, 20212022 and 2020,2021, respectively (dollars in thousands):Three Months Ended
June 30,Six Months Ended
June 30,2022 2021 2022 2021 Opening Balance $ 1,275,681 $ 1,406,823 $ 1,281,982 $ 1,398,817 Net income (loss) available to common shareholders 26,373 (72,079) 17,281 (64,456) Common stock distributions — — — — Redeemable noncontrolling interests (3,524) (1,550) (6,466) (3,341) Redemption of common units for common stock 161 2,716 161 2,716 Shares issued under Dividend Reinvestment and Stock Purchase Plan 16 11 27 29 Directors' deferred compensation plan 110 66 220 138 Stock Compensation 2,509 1,239 4,466 1,885 Cancellation of common stock (696) — (696) (118) Other comprehensive income (loss) (54) — 1,932 — Rebalancing of ownership percent between parent and subsidiaries (4,296) (2,000) (2,627) (444) Balance at June 30 $ 1,296,280 $ 1,335,226 $ 1,296,280 $ 1,335,226 SHARE/UNIT REPURCHASEIn September 2012,Board of Directors of the General Partner renewedCompany entered into a distribution agreement (the “Distribution Agreement”) with J.P. Morgan Securities LLC, BofA Securities, Inc., BNY Mellon Capital Markets, LLC, Capital One Securities, Inc., Comerica Securities, Inc., Goldman Sachs & Co. LLC, R. Seelaus & Co., LLC and authorized an increaseSamuel A. Ramirez & Company, Inc., as sales agents. Pursuant to the General Partner’s repurchase program (“Repurchase Program”). The General Partner has authorization to repurchase up to $150 million of its outstanding common stock underDistribution Agreement, the renewed Repurchase Program, which itCompany may repurchaseissue and sell, from time to time, in open market transactions at prevailing prices orshares of common stock, par value $0.01 per share, having a combined aggregate offering price of up to $200 million. The Company will pay a commission that will not exceed, but may be lower than, 2% of the gross proceeds of all shares sold through privately negotiated transactions.the ATM Program. As of SeptemberJune 30, 2021,2022, the General Partner has repurchased and retired 394,625Company had not sold any shares of its outstanding common stock for an aggregate cost of approximately $11 million (all of which occurred in the year ended December 31, 2012), with a remaining authorization under the Repurchase Program of $139 million. Concurrent with these repurchases, the General Partner soldpursuant to the Operating Partnership common units for approximately $11 million.ATM Program.
OPTION PLANShadhas been reserved for issuance. In June 2021, stockholders of the Company approved amendments to the 2013 Plan to increase the total shares reserved for issuance under the plan from 4,600,000 to 6,565,000 shares.to the chief executive officer as an employment “inducement award” that is intended to comply with New York Stock Exchange Rule 303A.08.In connection with Ms. Gilmartin’s appointment as the Company’s interim Chief Executive Officer, the Company granted to MAG Partners fully vested stock options to purchase up to 230,000 shares of common stock with an exercise price of $14.39 per share, and up to 100,000 shares of common stock with an exercise price of $20.00 per share, of which 157,505 of the options were issued after shareholder approval at the Company’s 2021 Annual Meeting of Stockholders on June 9, 2021. See Note 13-Commitments and Contingencies.In connection with his appointment as Chief Executive Officer, Mr. Nia was granted 950,000 stock options on March 10, 2021 that had an exercise price equal to the closing price of the Company’s common stock on the grant date of $15.79 per share. Theshare to the Chief Executive Officer as an employment “inducement award” that is intended to comply with New York Stock Exchange Rule 303A.08. In April 2022, the General Partner granted 250,000 stock optionswill vest in one-third increments on each with an exercise price equal to the closing price of the first three anniversaries ofCompany’s common stock on the grant date of grant, subject$16.33 per share to earlier vesting on certain termination events. See Note 13-Commitments and Contingencies.0no stock options that were exercised under any stock option plans for the ninesix months ended SeptemberJune 30, 20212022 and 2020,2021, respectively. The Company has a policy of issuing new shares to satisfy stock option exercises.SeptemberJune 30, 20212022 and December 31, 2020,2021, the stock options outstanding had a weighted average remaining contractual life of approximately 5.75.1 and 3.65.5 years, respectively.$253,000$309 thousand and $192,000$224 thousand for the three months ended SeptemberJune 30, 20212022 and 2020,2021, respectively and $591,000$562 thousand and $192,000$338 thousand for the ninesix months ended SeptemberJune 30, 2022 and 2021, and 2020, respectively.UNITS (Appreciation-Only LTIP Units)Pursuant to the terms of the DeMarco employment agreement, the Company entered into an AO Long-Term Incentive Plan Award Agreement (the “AO LTIP Award Agreement”Units”) with Mr. DeMarco on March 13, 2019 that provided for the grant to Mr. DeMarco of 625,000 AO LTIP Units. AO LTIP Unitswhich are a class of partnership interests in the Operating Partnership that are intended to qualify as “profits interests” for federal income tax purposes and generally only allow the recipient to realize value to the extent the fair market value of a share of Common Stock exceeds the threshold level set at the time the AO LTIP Units are granted, subject to any vesting conditions applicable to the award. The threshold level was fixed at $21.46 in the AO LTIP Award Agreement, the closing price of the Common Stock as reported on the New York Stock Exchange (the “NYSE”) on the date of grant.purposes. The value of vested AO LTIP Units is realized through conversion of the AO LTIP Units into common units of limited partnership interests of the Operating Partnership (the “Common Units”). The number of Common Units into which vested AO LTIP Units may be converted is determined basedallow the former executive to earn zero to 100% of the AO LTIP Units granted on the quotienta graduated basis of (i) the excess250,000, 250,000 and 125,000 AOCommon Stock on the conversion date overCompany’s common stock exceeds the threshold level designated at the time the AO LTIP Unit was granted (i.e., $21.46), divided by (ii) the fair market valuelevels of the Common Stock on the conversion date. AO LTIP Units, once vested, have a finite term during which they may be converted into Common Units, within ten years from the grant date of the AO LTIP Units or they are forfeited. In addition, the AO LTIP Units issued to Mr. DeMarco are subject to the following vesting conditions:(i) 250,000 of the AO LTIP Units shall vest$25.00, $28.00 and become exercisable on the earliest date on which the closing price of the Common Stock, as reported on the NYSE, or if the Common Stock is not then traded on the NYSE, then the closing price of the Common Stock on any other securities exchange on which the Common Stock is traded or quoted (the “Securities Market”), has been equal to or greater than $25.00 per share$31.00 for at least 30 consecutive trading days provided that such date occurs prior to March 13, 2023 (the “Outside Date”);(ii) an additional 250,000 of the AO LTIP Units shall vest and become exercisable on the earliest date on which the closing price of the Common Stock, as reported on the NYSE, or if the Common Stock is not then traded on the NYSE, then the closing price of the Common Stock on the Securities Market, has been equal to or greater than $28.00 per share for at least 30 consecutive trading days, provided that such date occurs prior to the Outside Date; and(iii) an additional 125,000 of the AO LTIP Units shall vest and become exercisable on the earliest date on which the closing price of the Common Stock, as reported on the NYSE, or if the Common Stock is not then traded on the NYSE, then the closing price of the Common Stock on the Securities Market, has been equal to or greater than $31.00 per share for at least 30 consecutive trading days, provided that such date occurs prior to the Outside Date.Mr. DeMarco will generally receive special income allocations in respect of an AO LTIP Unit equal to 10 percent (or such other percentage specified in the applicable award agreement) of the income allocated in respect of a Common Unit. 2023.Mr. DeMarco will be entitled to receive in respect of each such AO LTIP Unit, on a per unit basis, a special cash distribution will be granted equal to 10% (or such other percentage specified in the applicable award agreement) of the distributions received by a holder of an equivalent number of Common Units during the period from the grant date of the AO LTIP Units through the date of conversion. The Company has reserved sharesconversion in respect of common stock under the 2013 Plan for issuance upon vesting and conversion of theeach such AO LTIP Units in accordance with their terms and conditions.SeptemberJune 30, 2021,2022, the Company had $0.9$0.4 million of total unrecognized compensation cost related to unvested AO LTIP Units granted under the Company’s stock compensation plans. That cost is expected to be recognized over a remaining weighted average period of 1.40.7 years. The Company recognized AO LTIP unit expense of $156,000$156 thousand and $155 thousand for each of the three months ended SeptemberJune 30, 2022 and June 30, 2021, and 2020,$311 thousand and $466,000$310 thousand for each of the ninesix months ended SeptemberJune 30, 20212022 and 2020.RESTRICTED STOCK AWARDS9, 2021,15, 2022, the Company issued Restricted Stock Awards to non-employee members of the Board of Directors of the General Partner which vest within one year, of which 39,52949,784 unvested Restricted Stock Awards were outstanding at SeptemberJune 30, 2021. From July to September,2022. During the year ended December 31, 2021 and the six months ended June 30, 2022, respectively, the Company granted restricted stock units to certain non-executivenon executive employees of the Company which will vest after three years, of which 208,769309,762 were still outstanding at Septemberas of June 30, 2021.2022. Restricted Stock Awards allow holders to receive shares of the Company’s common stock upon vesting. Vesting of the outstanding Restricted Stock Awards issued are generallyis based on time and service. All currently outstanding and unvested Restricted Stock Awards provided to the officers, certain other employees, and members of the Board of Directors of the General Partner were issued under the 2013 Plan.LONG-TERM INCENTIVE PLAN AWARDSOn April 20, 2018,Plan and as inducement awards.awardsAwards”) to senior management of the Company, including the General Partner’s executive officers (the “2018officers. LTIP Awards”). AllAwards generally are granted in the form of the 2018 LTIP AwardsUnits, except for awards granted in 2021 and 2022 which were in the form of restricted stock units (each, an “RSU” and collectively, the “RSU LTIP UnitsAwards”) and constitute awards under the 2013 Plan. LTIP Awards are typically issued from the Company’s Outperformance Plan adopted by the General Partner’s Board of Directors.Messrs. DeMarco and Tycher,LTIP Awards granted in 2019, approximately twenty-five25 percent (25%)to 100 percent of the grant date fair value of the 2018 LTIP Award wasAwards were in the form of a time-based awardawards that vestsvest after three years on April 20, 2021 (the “2018 TBV LTIP Units”), and the remaining approximately seventy-five percent (75%)portion of the grant date fair value of the 20182019 LTIP Award was in the form of a performance-based award under the Company’s Outperformance Plan (the “2018 OPP”) adopted by the General Partner’s Board of Directors, consisting of a multi-year, performance-based equity compensation planAwards and related forms of award agreement (the “2018 PBV LTIP Units”). For all other executive officers, approximately fifty percent (50%) of the grant date fair value2020 LTIP Awards consist of the 2018 LTIP Award was in the formmulti-year, market-based awards. Participants of 2018 TBV LTIP Units and the remaining approximately fifty percent (50%) of the grant date fair value of the 2018 LTIP Award was in the form of 2018 PBV LTIP Units. The 2018 TBV LTIP Units vested on April 20, 2021.The 2018 OPP was designed to align the interests of senior management to relative and absolute performance of the Company over a three year performance period from April 20, 2018 through April 19, 2021. Participants in the 2018 OPPperformance-based awards will only earn the full awards if, over the three year performance period, the Company achieves a thirty-six36 percent (36%) absolute TSR and if the Company’s TSR is in the 75th percentile of performance as compared to the office REITs in the NAREIT index. As the targets for vesting were partially achieved, 31.25 percent of the 2018 PBV LTIP Units vested and the unvested 2018 PBV LTIP Units were forfeited on April 19, 2021.On March 22, 2019, the Company granted LTIP awards to senior management of the Company, including the General Partner’s executive officers (the “2019 LTIP Awards”). All of the 2019 LTIP Awards were in the form of LTIP Units and constitute awards under the 2013 Plan. For Mr. DeMarco, approximately 25 percent of the target 2019 LTIP Awards were in the form of time-based LTIP Units that vest after three years on March 22, 2022 (the “2019 TBV LTIP Units”), and the remaining approximately 75 percent of the grant date fair value of his 2019 LTIP Award will be in the form of performance-based LTIP Units under the Company’s Outperformance Plan (the “2019 OPP”) adopted by the General Partner’s Board of Directors, consisting of a multi-year, performance-based equity compensation plan and related forms of award agreement (the “2019 PBV LTIP Units”). For Messrs. Tycher, Smetana, Wagner, Cardoso and Hilton, fifty percent (50%) of the grant date fair value of their respective 2019 LTIP Awards is in the form of 2019 TBV LTIP Units and the remaining fifty percent (50%) of the grant date fair value of their respective 2019 LTIP Awards is in the form of 2019 PBV LTIP Units. Mr. DeBari, who was promoted to Chief Accounting Officer on March 13, 2019, received 100 percent of his 2019 LTIP Award in the form of 2019 TBV LTIP Units.The 2019 OPP was designed to align the interests of senior management to relative and absolute performance of the Company over a three year performance period from March 22, 2019 through March 21, 2022. Participants of performance-based awards in the 2019 OPP will only earn the full awards if, over the three year performance period, the Company achieves a thirty-six percent (36%) absolute total stockholder return (“TSR”) and if the Company’s TSR is in the 75th percentile of performance as compared to the office REITs in the NAREIT index.On March 24, 2020, the Companyindex for awards granted LTIP awards to senior management of the Company, including the General Partner’s executive officers (the “2020 LTIP Awards”). All of the 2020 LTIP Awards were in the form of LTIP Units2019 and constitute awards under the 2013 Plan. All of the target 2020 LTIP Awards were in the form of performance-based LTIP Units under the Company’s Outperformance Plan (the “2020 OPP”) adopted by the General Partner’s Board of Directors, consisting of a multi-year, performance-based equity compensation plan and related forms of award agreement (the “2020 PBV LTIP Units”).The 2020 OPP was designed to align the interests of senior management to relative and absolute performance of the Company over a three year performance period from March 24, 2020 through March 23, 2023. Participants of performance-based awards in the 2020 OPP will only earn the full awards if, over the three year performance period, the Company achieves a thirty-six percent (36%) absolute total stockholder return (“TSR”) and if the Company’s TSR is in the 75th percentile of performance as compared to the REITs in theNAREIT index.OnIn January 4, 2021, in accordance with Mr. Cardoso’s employment agreement, the Company granted LTIP awardsUnits (the “J Series 2021 LTIP Awards”). All of under the 2013 Plan. The J Series 2021 LTIP Awards were in the form of LTIP Units and constitute awards under the 2013 Plan. All of the target 2021 LTIP Awards were in the form of performance-based LTIP Units under the Company’s Outperformance Plan (the “J Series 2021 OPP”) adopted by the General Partner’s Board of Directors, consisting of a multi-year, performance-based equity compensation plan and related forms of award agreement (the “J Series 2021 PBV LTIP Units”).The J Series 2021 OPP wasare subject to the achievement of certain sales performance milestones with respect to commercial asset dispositions by the Company over a performance period from August 1, 2020 through December 31, 2022. These sales milestones will be based on the aggregate gross sales prices of the assets, provided that the asset will only be included in the milestone if it is sold for not less than 85%85 percent of its estimated net asset value, as defined in the agreement. These awards were granted to one executive who was terminated in the first quarter of 2022, and as a result of the termination, the21,1, 2022.long-term incentive plan awards to senior management of the Company, including the General Partner’s executive officers (the “2021 RSU LTIP Awards”). All of the 2021 RSU LTIP Awards were in the form of restricted stock units (each, an “RSU”) and constitute awards under the 2013 Plan.RSUs. Each RSU entitles the holder to one share of the General Partner’s common stock upon settlement. 291,951Approximately 292,000 of the RSUs are subject to time-based vesting conditions (the “TRSUs”) and will vest in 3three equal, annual installments over a three year period commencing onending in April 21,2024, of which 55,825 of the RSUs vested in April 2022. 452,730Approximately 453,000 of the RSUs are subject to performance basedmarket-based vesting conditions (the “PRSUs”). Recipients will only earn the full amount of the PRSUsmarket-based RSUs if, over the three year performance period, the General Partner achieves a thirty-six36 percent (36%) absolute total stockholder return (“TSR”)TSR and if the General Partner’s TSR is in the 75th percentile of performance as compared to a group of twenty-four (24)24 peer REITs.291,951approximately 292,000 RSUs were granted subject to the achievement of certain outperformance conditions (the “OPRSUs”). Recipients will only earn the full amount of the OPRSUs of the General Partner achieves adjusted funds from operations of $0.60 per share in the fiscal year ending December 31, 2023. 21, 2021 through April 20, 2024.2022, the General Partner granted approximately 60,000 RSUs will remainsubject to time-vesting conditions, vesting over three years, to three executive officers as “inducement awards” intended to comply with New York Stock Exchange Rule 303A.08.the 2021 RSU LTIP Awards vest.LTIP Units will remain subject to forfeiture depending on the extent that the 2019 LTIP Awards, 2020 LTIP Awards, J Series 2021 LTIP Awards and 2021 RSU LTIP Awardsawards vest. The number of market-based and performance-based LTIP Units to be issued initially to recipients of the 2019 PBV LTIP Awards, 2020 PBV LTIP Awards, J Series LTIP Awards and PRSUs is the maximum number of LTIP Units or common stock that may be earned under the awards. The number of LTIP Units or common stock that actually vest for each award recipient will be determined at the end of the performancerelated measurement period. For the 2019 LTIP Awards, 2020 LTIP Awards and PRSUs, TSR for the Company and for the Index over the three year measurement period and other circumstances will determine how many LTIP Units or common units vest for each recipient; if they are fewer than the number issued initially, the balance will be forfeited as of the performance measurement date. For the J Series LTIP Awards, achievement of the sales performance milestone will determine how many LTIP Units vest for Mr. Cardoso, and if the amount vested is fewer than the number issued, the balance will be forfeited as of the end of the Measurement Period.(10 percent) of the regular quarterly distributions payable on a Common Unitcommon share but will not be entitled to receive any special distributions. Distributions with respect to the other nine-tenths (90 percent) of regular quarterly distributions payable on a common unit will accrue but shall only become payable upon vesting of the LTIP Unit. After vesting of the 2019 TBV LTIP Units and 2020 TBV LTIP Units or the end of the measurement period for the 2019 PBV LTIP Units, 2020 PBV LTIP Units and J Series 2021 PBV LTIP Units, the number of LTIP Units, both vested and unvested, will be entitled to receive distributions in an amount per unit equal to distributions, both regular and special, payable on a Common Unit. Prior to vesting, recipients of TRSUs will be entitled to receive TRSU dividend equivalent amounts which shall be paid concurrently with the common cash dividend. Prior to vesting, recipients of PRSUs and OPRSUs will not be entitled to receive dividend equivalent amounts. PRSU and OPRSU dividend equivalent amounts will accrue but shall only become payable upon vesting of the PRSUs and OPRSUs.SeptemberJune 30, 2021,2022, the Company had $6.1$1.5 million of total unrecognized compensation cost related to unvested LTIP awards granted under the Company’s stock compensation plans. That cost is expected to be recognized over a weighted average period of 1.7 years.DEFERRED STOCK COMPENSATION PLAN FOR DIRECTORSnon-employeenon-employee directors of the Company to elect to defer up to 100 percent of their annual retainer fee into deferred stock units. The deferred stock Pursuant to the termination of service of five directors from the Board of Directors on June 12, 2019, the Company converted 193,949 deferred stock units into shares of common stock. Pursuant to the termination of service of two directors from the Board of Directors on June 12, 2020, the Company converted 61,277 deferred stock units into shares of common stock. Deferred stock units are credited to each director quarterly using the closing price of the Company’s common stock on the applicable dividend record date for the respective quarter. Each participating director’s account is also credited for an equivalent amount of deferred stock units based on the dividend rate for each quarter.SeptemberJune 30, 2022 and 2021, 8,234 and 2020, 5,113 and 5,9523,798 deferred stock units were earned, respectively. During the ninesix months ended SeptemberJune 30, 2022 and 2021, 14,417 and 2020, 13,494 and 15,6638,381 deferred stock units were earned, respectively. As of SeptemberJune 30, 20212022 and December 31, 2020,2021, there were 32,65948,355 and 17,85437,603 deferred stock units outstanding, respectively.ninesix months ended SeptemberJune 30, 20212022 and 20202021 in accordance with ASC 260, Earnings Per Share (dollars in thousands, except per share amounts):Mack-Cali Realty Corporation:Three Months Ended
June 30,Six Months Ended
June 30,Computation of Basic EPS 2022 2021 2022 2021 Income (loss) from continuing operations $ 38,247 $ (79,712) $ 32,975 $ (100,756) Add (deduct): Noncontrolling interests in consolidated joint ventures 784 1,198 1,758 2,533 Add (deduct): Noncontrolling interests in Operating Partnership (3,029) 7,742 (2,064) 10,122 Add (deduct): Redeemable noncontrolling interests (6,366) (6,471) (12,803) (12,942) Add (deduct): Redemption value adjustment of redeemable noncontrolling interests attributable to common shareholders (3,524) (1,550) (6,466) (3,341) Income (loss) from continuing operations available to common shareholders $ 26,112 $ (78,793) $ 13,400 $ (104,384) Income (loss) from discontinued operations available to common shareholders (3,263) 5,164 (2,585) 36,587 Net income (loss) available to common shareholders for basic earnings per share 22,849 (73,629) 10,815 (67,797) Weighted average common shares 91,027 90,774 90,989 90,733 Income (loss) from continuing operations available to common shareholders $ 0.29 $ (0.87) $ 0.15 $ (1.15) Income (loss) from discontinued operations available to common shareholders (0.04) 0.06 (0.03) 0.40 Net income (loss) available to common shareholders $ 0.25 $ (0.81) $ 0.12 $ (0.75) Three Months Ended
June 30,Six Months Ended
June 30,Computation of Diluted EPS 2022 2021 2022 2021 Net income (loss) from continuing operations available to common shareholders $ 26,112 $ (78,793) $ 13,400 $ (104,384) Add (deduct): Noncontrolling interests in Operating Partnership 3,029 (7,742) 2,064 (10,122) Add (deduct): Redemption value adjustment of redeemable noncontrolling interests attributable to the Operating Partnership unitholders (360) (155) (651) (334) Income (loss) from continuing operations for diluted earnings per share 28,781 (86,690) 14,813 (114,840) Income (loss) from discontinued operations for diluted earnings per share (3,597) 5,681 (2,852) 40,246 Net income (loss) available for diluted earnings per share $ 25,184 $ (81,009) $ 11,961 $ (74,594) Weighted average common shares 100,352 99,873 100,171 99,817 Income (loss) from continuing operations available to common shareholders $ 0.29 $ (0.87) $ 0.15 $ (1.15) Income (loss) from discontinued operations available to common shareholders (0.04) 0.06 (0.03) 0.40 Net (income) loss available to common shareholders $ 0.25 $ (0.81) $ 0.12 $ (0.75)
Contingently issuable shares under Restricted Stock Awards were excluded from the denominator during Three Months Ended
June 30,Six Months Ended
June 30,2022 2021 2022 2021 Basic EPS shares 91,027 90,774 90,989 90,733 Add: Operating Partnership – common and vested LTIP units 9,302 9,099 9,144 9,084 Restricted Stock Awards 7 — 10 — Stock Options 16 — 28 — Diluted EPS Shares 100,352 99,873 100,171 99,817 allthe periods presentedended June 30, 2021 as such securities were anti-dilutive during the periods. Shares issuable under all outstanding stock options were excluded from the denominator during allthe periods presentedended June 30, 2021 as such securities were anti-dilutive during the periods. Also not included in the computations of diluted EPS were the unvested LTIP Units and unvested AO LTIP Units as such securities were anti-dilutive during all periods presented. Unvested LTIP Awards outstanding as of June 30, 2022 and 2021 were 1,866,543 and 1,922,795, respectively. Unvested restricted common stock outstanding as of June 30, 2022 and 2021 were 49,784 and 39,529 shares, respectively. Unvested AO LTIP Units outstanding as of each of June 30, 2022 and 2021 were 625,000.three-monthsix-month periods ended SeptemberJune 30, 20212022 and 2020. Dividends declared per common share for the nine-month periods ended September 30, 2021 and 2020 were 0 and $0.40 per share, respectively.Mack-Cali Realty,Veris Residential, L.P.:Three Months Ended
June 30,Six Months Ended
June 30,Computation of Basic EPU 2022 2021 2022 2021 Income (loss) from continuing operations $ 38,247 $ (79,712) $ 32,975 $ (100,756) Add (deduct): Noncontrolling interests in consolidated joint ventures 784 1,198 1,758 2,533 Add (deduct): Redeemable noncontrolling interests (6,366) (6,471) (12,803) (12,942) Add (deduct): Redemption value adjustment of redeemable noncontrolling interests (3,884) (1,705) (7,117) (3,675) Income (loss) from continuing operations available to unitholders 28,781 (86,690) 14,813 (114,840) Income (loss) from discontinued operations available to unitholders (3,597) 5,681 (2,852) 40,246 Net income (loss) available to common unitholders for basic earnings per unit $ 25,184 $ (81,009) $ 11,961 $ (74,594) Weighted average common units 100,329 99,873 100,133 99,817 Income (loss) from continuing operations available to unitholders $ 0.29 $ (0.87) $ 0.15 $ (1.15) Income (loss) from discontinued operations available to unitholders (0.04) 0.06 (0.03) 0.40 Net income (loss) available to common unitholders for basic earnings per unit $ 0.25 $ (0.81) $ 0.12 $ (0.75) Three Months Ended
June 30,Six Months Ended
June 30,Computation of Diluted EPU 2022 2021 2022 2021 Net income (loss) from continuing operations available to common unitholders $ 28,781 $ (86,690) $ 14,813 $ (114,840) Income (loss) from discontinued operations for diluted earnings per unit (3,597) 5,681 (2,852) 40,246 Net income (loss) available to common unitholders for diluted earnings per unit $ 25,184 $ (81,009) $ 11,961 $ (74,594) Weighted average common unit 100,352 99,873 100,171 99,817 Income (loss) from continuing operations available to common unitholders $ 0.29 $ (0.87) $ 0.15 $ (1.15) Income (loss) from discontinued operations available to common unitholders (0.04) 0.06 (0.03) 0.40 Net income (loss) available to common unitholders $ 0.25 $ (0.81) $ 0.12 $ (0.75) Three Months Ended
June 30,Six Months Ended
June 30,2022 2021 2022 2021 Basic EPU units 100,329 99,873 100,133 99,817 Add: Restricted Stock Awards Add: Restricted Stock Awards 7 — 10 — Stock Options Stock Options 16 — 28 — Diluted EPU Units 100,352 99,873 100,171 99,817 allthe periods presentedended June 30, 2021 as such securities were anti-dilutive during the periods. Shares issuable under all outstanding stock options were excluded from the denominator during the periods ended June 30, 2021 as such securities were anti-dilutive during the periods. Also not included in the computations of diluted EPU were the unvested LTIP Units and unvested AO LTIP Units as such securities were anti-dilutive during all periods presented. NaNUnvested LTIP Awards outstanding as of June 30, 2022 and 2021 were 1,866,543 and 1,922,795, respectively. Unvested restricted common stock outstanding as of June 30, 2022 and 2021 were 49,784 and 39,529 shares, respectively. Unvested AO LTIP Units outstanding as of each of June 30, 2022 and 2021 were 625,000.three-monthsix-month periods ended SeptemberJune 30, 20212022 and 2020. Distribution declared per common share for the nine-month periods ended September 30, 2021 and 2020 were 0 and $0.40 per unit, respectively.17.16. NONCONTROLLING INTERESTS IN SUBSIDIARIESninethree and six months ended SeptemberJune 30, 20212022 and 2020,2021, respectively (dollars in thousands):Three Months EndedNine Months Ended Three Months Ended
June 30,Six Months Ended
June 30, 2022 2021 2022 2021 Opening Balance $ 165,120 $ 182,693 $ 167,436 $ 193,563 Net (loss) income 8,277 (1,952) 12,842 3,946 Unit distributions — 639 218 643 Redeemable noncontrolling interests (6,726) (6,626) (13,454) (13,276) Change in noncontrolling interests in consolidated joint ventures 7 175 18 185 Redemption of common units for common stock (161) (2,716) (161) (2,716) Redemption of common units (359) (410) (1,801) (10,869) Stock compensation 445 1,304 2,978 3,187 Other comprehensive income (loss) (6) — 190 — Rebalancing of ownership percentage between parent and subsidiaries 4,296 2,000 2,627 444 Balance at June 30 $ 170,893 $ 175,107 $ 170,893 $ 175,107 , changes in a parent’s ownership interest (and transactions with noncontrolling interests unitholders in the subsidiary) while the parent retains its controlling interest in its subsidiary should be accounted for as equity transactions. The carrying value of the noncontrolling interests shall be adjusted to reflect the change in itsMack-Cali Realty CorporationVeris Residential, Inc. stockholders’ equity and noncontrolling interests in the Operating Partnership that occurred during the ninesix months ended SeptemberJune 30, 2021,2022, the Company has decreased noncontrolling interests in the Operating Partnership and increaseddecreased additional paid-in capital in Mack-Cali Realty CorporationVeris Residential, Inc. stockholders’ equity by approximately $0.5$2.6 million as of SeptemberJune 30, 2021.2022.
ninesix months ended SeptemberJune 30, 2021, the Company redeemed 678,302 common units at their fair market value of $10.5 million, which was included as part of the buyer’s purchase consideration in the disposition of an office property in January 2021. See Note 3: Recent Transactions. During the nine months ended September 30, 2021,2022, the Company redeemed for cash 41,750108,416 common units at their fair value of $0.7$1.8 million.Mack-Cali Realty CorporationVeris Residential, Inc. Stockholders’ equity is increased.On March 8, 2016,2016 LTIP Awardsawards to senior managementexecutive officers of the Company, including the General Partner’s executive officers. On April 4, 2017, the Company granted 2017 LTIP Awards to senior management of the Company, including the General Partner’s executive officers. On April 20, 2018, the Company granted 2018 LTIP Awards to senior management of the Company, including the General Partner’s executive officers. On March 22, 2019, the Company granted 2019 LTIP Awards to senior management of the Company, including the General Partner’s executive officers. On March 24, 2020, the Company granted 2020 LTIP Awards to senior management of the Company, including the General Partner’s executive officers. On January 4, 2021, the Company granted J Series 2021 LTIP Awards to one of the General Partner’s executive officers.Company. All of the 2016 LTIP Awards 2017 LTIP Awards, 2018 LTIP Awards, 2019 LTIP Awards, 2020 LTIP Awards and J Seriesgranted through January 2021 LTIP Awards are in the form of units in the Operating Partnership. See Note 16: Mack-Cali Realty Corporation15: Veris Residential, Inc. Stockholders’ Equity and Mack-Cali Realty,Veris Residential, L.P.’s Partners’ Capital – Long-Term Incentive Plan Awards. to Mr. DeMarco pursuant to the AO Long Term Incentive Plan Award Agreement. See Note 16: Mack-Cali Realty Corporation15: Veris Residential, Inc. Stockholders’ Equity and Mack-Cali Realty,Veris Residential, L.P.’s Partners’ Capital – AO LTIP Units (Appreciation-Only LTIP Units).SeptemberJune 30, 20212022 and December 31, 2020,2021, the noncontrolling interests common unitholders owned 9.09.3 percent and 9.69.0 percent of the Operating Partnership, respectively.18. 17. SEGMENT REPORTINGestate and (ii) multi-family real estate and services.estate. The Company provides leasing, property management, leasing, acquisition, development, construction and tenant-related services for its commercial and other real estate and multi-familymultifamily real estate portfolio. The Company’s multi-familymultifamily services business also provides similar services for third parties. The Company had 0no revenues from foreign countries recorded for the ninesix months ended SeptemberJune 30, 20212022 and 2020.2021. The Company had 0no long lived assets in foreign locations as of SeptemberJune 30, 20212022 and December 31, 2020.2021. The accounting policies of the segments are the same as those described in Note 2: Significant Accounting Policies, excluding depreciation and amortization.multi-familymultifamily real estate and services). All properties classified as discontinued operations have been excluded.ninethree and six months ended SeptemberJune 30, 20212022 and 20202021 and selected asset information as of SeptemberJune 30, 20212022 and December 31, 20202021 regarding the Company’s operating segments are as follows. Amounts for prior periods have been restated to conform to the current period segment reporting presentation (dollars in thousands):Commercial
& Other Real EstateMultifamily
Real Estate & Services (d)Corporate
& Other (e)Total
CompanyTotal revenues: Three months ended: June 30, 2022 $ 27,392 $ 52,876 $ (442) $ 79,826 June 30, 2021 39,886 40,279 (478) 79,687 Six months ended: June 30, 2022 $ 79,010 $ 99,393 $ (944) $ 177,459 June 30, 2021 77,581 77,596 (957) 154,220 Total operating and interest expenses (a): Three months ended: June 30, 2022 $ 13,645 $ 26,221 $ 27,714 $ 67,580 June 30, 2021 15,946 30,909 27,732 74,587 Six months ended: June 30, 2022 $ 30,777 $ 51,008 $ 57,333 $ 139,118 June 30, 2021 35,270 53,065 52,182 140,517 Equity in earnings (loss) of unconsolidated joint ventures: Three months ended: June 30, 2022 $ — $ 2,638 $ — $ 2,638 June 30, 2021 (14) 363 — 349 Six months ended: June 30, 2022 $ — $ 2,151 $ — $ 2,151 June 30, 2021 (133) (974) — (1,107) Net operating income (loss) (b): Three months ended: June 30, 2022 $ 13,747 $ 29,293 $ (28,156) $ 14,884 June 30, 2021 23,926 9,733 (28,210) 5,449 Six months ended: June 30, 2022 $ 48,233 $ 50,536 $ (58,277) $ 40,492 June 30, 2021 42,178 23,557 (53,139) 12,596 Total assets: June 30, 2022 $ 952,889 $ 3,344,869 $ 13,239 $ 4,310,997 December 31, 2021 1,216,717 3,294,226 16,375 4,527,318 Total long-lived assets (c): June 30, 2022 $ 881,373 $ 3,038,397 $ (1,602) $ 3,918,168 December 31, 2021 1,087,198 3,098,492 (1,309) 4,184,381 Total investments in unconsolidated joint ventures: June 30, 2022 $ — 132,790 $ — $ 132,790 December 31, 2021 — 137,772 — 137,772 receivable and goodwill.receivable.Three Months Ended
June 30,Six Months Ended
June 30,2022 2021 2022 2021 Net operating income $ 14,884 $ 5,449 $ 40,492 $ 12,596 Add (deduct): Depreciation and amortization (27,733) (28,498) (53,851) (56,276) Property Impairments — (6,041) — (6,041) Land and other impairments, net (3,900) (7,519) (6,832) (7,932) Realized gains (losses) and unrealized losses on disposition of rental property, net — 3,521 1,836 3,521 Gain on disposition of developable land 55,125 111 57,748 111 Gain (loss) from extinguishment of debt, net (129) (46,735) (6,418) (46,735) Income (loss) from continuing operations 38,247 (79,712) 32,975 (100,756) Discontinued operations Income from discontinued operations 843 3,601 1,588 15,385 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net (4,440) 2,080 (4,440) 24,861 Total discontinued operations, net (3,597) 5,681 (2,852) 40,246 Net income (loss) 34,650 (74,031) 30,123 (60,510) Noncontrolling interests in consolidated joint ventures 784 1,198 1,758 2,533 Noncontrolling interests in Operating Partnership (3,029) 7,742 (2,064) 10,122 Noncontrolling interest in discontinued operations 334 (517) 267 (3,659) Redeemable noncontrolling interests (6,366) (6,471) (12,803) (12,942) Net income (loss) available to common shareholders $ 26,373 $ (72,079) $ 17,281 $ (64,456) Mack-Cali Realty,Veris Residential, L.P.Three Months Ended
June 30,Six Months Ended
June 30,2022 2021 2022 2021 Net operating income $ 14,884 $ 5,449 $ 40,492 $ 12,596 Add (deduct): Depreciation and amortization (27,733) (28,498) (53,851) (56,276) Property Impairments — (6,041) — (6,041) Land and other impairments, net (3,900) (7,519) (6,832) (7,932) Realized gains (losses) and unrealized losses on disposition of rental property, net — 3,521 1,836 3,521 Gain on disposition of developable land 55,125 111 57,748 111 Gain (loss) from extinguishment of debt, net (129) (46,735) (6,418) (46,735) Income (loss) from continuing operations 38,247 (79,712) 32,975 (100,756) Discontinued operations Income from discontinued operations 843 3,601 1,588 15,385 Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net (4,440) 2,080 (4,440) 24,861 Total discontinued operations, net (3,597) 5,681 (2,852) 40,246 Net income (loss) 34,650 (74,031) 30,123 (60,510) Noncontrolling interests in consolidated joint ventures 784 1,198 1,758 2,533 Redeemable noncontrolling interests (6,366) (6,471) (12,803) (12,942) Net income (loss) available to common unitholders $ 29,068 $ (79,304) $ 19,078 $ (70,919) Mack-Cali Realty CorporationVeris Residential, Inc. and Mack-Cali Realty,Veris Residential, L.P. and the notes thereto (collectively, the “Financial Statements”). Certain defined terms used herein have the meaning ascribed to them in the Financial Statements.Mack-Cali Realty Corporation,Mack-Cali Realty,Veris Residential, L.P. (the “Operating Partnership”), has been involved in all aspects of commercial real estate development, management and ownership for over 60 years and the General Partner has been a publicly traded real estate investment trust (“REIT”)REIT since 1994. management, acquisition, development construction and tenant-related services for its General Partner. The Operating Partnership, through its operating divisions and subsidiaries, including the Mack-CaliVeris property-owning partnerships and limited liability companies, is the entity through which all of the General Partner’s operations are conducted. Unless stated otherwise or the context requires, the “Company” refers to the General Partner and its subsidiaries, including the Operating Partnership and its subsidiaries.SeptemberJune 30, 2021,2022, the Company owns or has interests in 36 properties (collectively, the “Properties”), consisting and developable land. These Properties are comprised of eight office properties, totaling approximately 5.1 million square feet leased to approximately 110 commercial tenants, 20 multi-family23 multifamily rental properties containing 6,0187,441 apartment units as well as non-core assets comprised of six office properties, four parking/retail properties totaling approximately 108,000 square feet,and three hotels containing 723 rooms and one parcel of land leased to a third party.hotels. The Properties are located in three states in the Northeast, some with adjacent, Company-controlled developable land sites able to accommodate up to approximately 1.4 million square feetplus the District of additional commercial space and approximately 8,500 apartment units. The Company’s historical strategy has been to focus its operations, acquisition and development of office and multi-family rental properties in high-barrier-to-entry markets and sub-markets where it believes it is, or can become, a significant and preferred owner and operator.STRATEGIC DIRECTIONOn December 19, 2019, the Company announced that its Board had determined to sell the Company’s entire suburban New Jersey office portfolio totaling approximately 6.6 million square feet, which had excluded the Company’s office properties in Jersey City and Hoboken, New Jersey (collectively, the “Suburban Office Portfolio”). As the decision to sell the Suburban Office Portfolio represented a strategic shift in the Company’s operations, these properties’ results (other than a single property not qualified to be classified as held for sale) are being classified as discontinued operations for all periods presented herein. See Note 7: Discontinued Operations – to the Financial Statements.In late 2019 and through September 30, 2021, the Company completed the sale of 35 of these suburban office properties, totaling 6 million square feet, for net sales proceeds of $1.0 billion. In October 2021, the Company completed the sale of the last Suburban Office Portfolio property classified as held for sale, which was a 248,480 square foot office property, for a gross sales price of $25.3 million.Starting in the three month period ended September 30, 2021, the Company’s multifamily properties accounted for more than half of the Company’s total revenue for the first time (See Note 18: Segment Reporting – to the Financial Statements). With the recent completion of the Suburban Office Portfolio dispositions which commenced in 2019, the Company has classified two office properties located in Jersey City and Hoboken, New Jersey totaling approximately 1.8 million square feet as held for sale as of September 30, 2021. The classification of these two office properties as held for sale is consistent with the Company’s ongoing efforts and strategy to continue to transition into a primarily multifamily residential company. The Company expects to continue to pursue opportunities to streamline its portfolio and enhance the stability of its revenue stream, as well as pursue overall expense savings from internal reorganizations which results from the shifting of the Company’s real estate portfolio.As an owner of real estate, almost all of the Company’s earnings and cash flow are derived from rental revenue received pursuant to leased space at the Properties. Key factors that affect the Company’s business and financial results include the following: the general economic climate;the occupancy rates of the Properties;rental rates on new or renewed leases;tenant improvement and leasing costs incurred to obtain and retain tenants;the extent of early lease terminations;the value of our office properties and the cash flow from the sale of such properties;operating expenses;anticipated acquisition and development costs for office and multi-family rental properties and the revenues and earnings from these properties;cost of capital; andthe extent of acquisitions, development and sales of real estate, including the execution of the Company’s current strategic initiative.Any negative effects of the above key factors could potentially cause a continued deterioration in the Company’s revenue and/or earnings. Such negative effects could include: (1) failure to renew or execute new leases as current leases expire; (2) failure to renew or execute new leases with rental terms at or above the terms of in-place leases; and (3) tenant defaults. The Company’s ability to renew or execute new leases as current leases expire or to execute new leases with rental terms at or above the terms of in-place leases may be affected by several factors such as: (1) the local economic climate, which may be adversely impacted by business layoffs or downsizing, industry slowdowns, changing demographics and other factors; and (2) local real estate conditions, such as oversupply of the Company’s product types or competition within the market. In addition, the COVID-19 pandemic could potentially cause deterioration in the financial condition or liquidity of the Company’s tenants, which could impair their ability to pay rents. A number of the Company’s tenants have requested rent relief during this pandemic. The COVID-19 pandemic could also potentially cause reduced demand for space at the Company’s office properties and/or units at its multi-family residential properties, parking facilities and hotel properties, which could have a negative impact on the Company’s prospects for leasing current or additional space and/or renewing leases with existing tenants.Of the Company’s core office markets, most continue to show signs of rental rate improvement, while the percentage of leased space has declined or stabilized. The percentage leased in the Company’s stabilized core operating commercial properties included in its Consolidated Properties aggregating 5.1 million, 5.3 million and 8.3 million square feet at September 30, 2021, June 30, 2021 and September 30, 2020, respectively, was 73.5 percent leased at September 30, 2021 as compared to 74.7 percent leased at June 30, 2021 and 78.2 percent leased at September 30, 2020 (after adjusting for properties identified as non-core at the time). Percentage leasedincludes all leases in effect as of the period end date, some of which have commencement dates in the future and leases that expire at the period end date. Leases that expired as of September 30, 2021, June 30, 2021 and September 30, 2020 aggregate 44,222, zero and 25,712 square feet, respectively, or 0.9, zero and 0.3 percentage of the net rentable square footage, respectively. Rental rates (including escalations) on the Company’s core commercial space that was renewed (based on first rents payable) during the nine months ended September 30, 2021 (on 54,400 square feet of renewals) decreased an average of 2.4 percent compared to rates that were in effect under the prior leases, as compared to a 12.0 percent increase during the nine months ended September 30, 2020 (on 375,119 square feet of renewals). Estimated lease costs for the renewed leases during the nine months ended September 30, 2021 averaged $3.87 per square foot per year for a weighted average lease term of 8.5 years, and estimated lease costs for the renewed leases during the nine months ended September 30, 2020 averaged $6.01 per square foot per year for a weighted average lease term of 5.6 years. The Company believes, although there can be no assurance, that vacancy rates at most of its commercial properties have begun to bottom as the majority of the known move-outs at its waterfront portfolio have already occurred. As of September 30, 2021, commercial leases which comprise approximately 3.0 and 3.7 percent of the Company’s annualized base rent are scheduled to expire during the years ending December 31, 2021 and 2022, respectively. With the current rental rate results the Company has achieved in its core markets recently, the Company believes, although there can be no assurance, that rental rates on new leases will generally be, on average, not lower than rates currently being paid. If recent leasing results continue to decline in 2021, the Company may receive less revenue from the same space.Effective March 6, 2018, the Company elected to utilize the leverage grid pricing available under the unsecured revolving credit facility and both unsecured term loans. This resulted in an interest rate of LIBOR plus 130 basis points for the Company’s unsecured revolving credit facility and 25 basis points for the facility fee and LIBOR plus 155 basis points for both unsecured term loans at the Company’s then total leverage ratio.The remaining portion of this Management’s Discussion and Analysis of Financial Condition and Results of Operations should help the reader understand our: recent transactions;critical accounting policies and estimates;results of operations for the three and nine months ended September 30, 2021, as compared to the three and nine months ended September 30, 2020, andliquidity and capital resources.Recent TransactionsProperties Commencing Initial OperationsThe following properties commenced initial operations during the nine months ended September 30, 2021 (dollars in thousands):(a)As of September 30, 2021, 193 apartment units are in service. The development costs included approximately $2.9 million in land costs.(b)As of September 30, 3021, 206 apartment units are in service. The remaining 107 apartment units are expected to be placed in service in the fourth quarter of 2021. The development costs included approximately $2.7 million in land costs.Additionally, a land lease located in Parsippany, New Jersey, with two restaurant tenants, also commenced initial operations during the three months ended March 31, 2021. Development costs incurred amounted to $5.1 million. This land lease was sold by the Company on June 30, 2021.Unconsolidated Joint VenturesOn April 29, 2021, the Company sold its interest in the 12 Vreeland Road joint venture for a gross sales price of approximately $2 million, with no gain or loss on the transaction.On September 1, 2021, the Company sold its interest in the Offices at Crystal Lake joint venture to its venture partner for $1.9 million and recorded a loss on the sale of approximately $1.9 million in the three and nine months ended September 30, 2021.Real Estate Held for Sale/Discontinued Operations/DispositionsThe Company identified three office properties (comprised of three disposal groups) totaling 2.1 million square feet (See Note 7: Discontinued Operations – to the Financial Statements), a small retail pad leased to others and several developable land parcels as held for sale as of September 30, 2021, including a developable land parcel in Jersey City, New Jersey. The total estimated sales proceeds, net of expected selling costs, from the sales of the remaining assets held for sale are expected to be approximately $727 million,however there can be no assurance of the amount and timing of any such salesproceeds. In October 2021, the Company completed the sale of the last Suburban Office Portfolio property classified as held for sale, which was a 248,480 square foot office property, for a gross sales price of $25.3 million. As a result of recent sales contracts in place and after considering the current market conditions as a result of the challenging economic climate with the current worldwide COVID-19 pandemic, the Company determined that the carrying value of two of the remaining held for sale properties and a land parcel held for sale was not expected to be recovered from estimated net sales proceeds, and accordingly recognized an unrealized held for sale loss allowance of $3.0 million and $3.5 million for the properties (none of which is included in discontinued operations) and also recorded land and other impairments of $0.3 million and $0.7 million, during the three and nine months ended September 30, 2021, respectively. As a result of recent sales contracts in place for a land parcel held for sale, the Company recognized an unrealized gain of $3.7 million during both the three and nine months ended September 30, 2021 (reversing cumulative held for sale loss allowances recognized).The Company disposed of the following rental properties during the nine months ended September 30, 2021 (dollars in thousands):(a)As part of the consideration from the buyer, 678,302 Common Units were redeemed by the Company at book value of $10.5 million, which was a non-cash portion of this sales transaction. The balance of the proceeds was received in cash and used to repay the Company's borrowings on its unsecured revolving credit facility. See Note 17: Noncontrolling Interests in Subsidiaries - Noncontrolling Interests in Operating Partnership.(b)Includes $10 million of seller financing provided to the buyers of the Metropark portfolio. See Note 5: Deferred charges, goodwill and other assets, net.(c)The mortgage loan encumbering three of the properties was defeased at closing, for which the Company incurred costs of $22.6 million. These costs were expensed as loss from extinguishment of debt during the three months ended June 30, 2021.On May 24, 2021, the Company disposed of a developable land parcel located in Hamilton, New Jersey, for net sales proceeds of $745,000 (and recorded a net gain of $111,000 on the disposition).In October 2021, the Company completed the sale of a 248,480 square foot office property classified as held for sale at September 30, 2021, for a gross sales price of $25.3 million.Impairments on Properties and Land Held and UsedThe Company determined that, due to the shortening of its expected period of ownership which occurred during the second quarter 2021, the Company evaluated the recoverability of the carrying value of its office property in Hoboken, New Jersey, and determined that it was necessary to reduce the carrying value of the property to its estimated fair value. Accordingly, the Company recorded an impairment charge of $6.0 million on the office property at June 30, 2021, which is included in property impairments on the consolidated statement of operations. Also, as a result of the Company’s shortening of its expected holding period beginning in the second quarter 2021, the Company evaluated the recoverability of the carrying value of its land parcels and determined that it was necessary to reduce the carrying values of a held-and-used developable land parcel located in Jersey City, New Jersey, to its estimated fair value and recorded in land and other impairment charges an amount of $6.8 million and $14.3 million for the three and nine months ended September 30, 2021.2020,2021, as certain disclosures in this Quarterly Report on Form 10-Q that would duplicate those included in the 10-K are not included in these financial statements.
ninesix months ended SeptemberJune 30, 20212022 (“2021”2022”), as compared to the three and ninesix months ended SeptemberJune 30, 20202021 (“2020”2021”), make reference to the following: the effect of the “Same-Store“Same-Store Properties,” which represent all in-service properties owned by the Company at June 30, 2020March 31, 2021 (for the three-month period comparisons), and which represent all in-service properties owned by the Company at December 31, 20192020 (for the nine-monthsix-month period comparisons) excluding properties sold, disposed of, removed from service, or being redeveloped or repositioned from January 1, 20202021 through SeptemberJune 30, 2021; 2022; the effect of the “Acquired“Acquired and Developed Properties,” which represent all properties acquired by the Company or commencing initial operations from JulyApril 1, 20202021 through SeptemberJune 30, 20212022 (for the three-month period comparisons), and which represent all properties acquired by the Company or commencing initial operations from January 1, 20202021 through SeptemberJune 30, 20212022 (for the nine-monthsix-month period comparisons); and the effect of “Properties“Properties Sold”, which represent properties sold, disposed of, or removed from service (including properties being redeveloped or repositioned) by the Company from January 1, 20202021 through SeptemberJune 30, 2021. 2022.SeptemberJune 30, 20212022 Compared to Three Months Ended SeptemberJune 30, 20202021
(dollars in thousands) Three Months Ended June 30, Dollar
ChangePercent
Change2022 2021 Revenue from rental operations and other: Revenue from leases $ 68,490 $ 67,376 $ 1,114 1.7 % Parking income 4,754 3,484 1,270 36.5 Hotel income 4,536 2,714 1,822 67.1 Other income 1,149 3,520 (2,371) (67.4) Total revenues from rental operations 78,929 77,094 1,835 2.4 Property expenses: Real estate taxes 12,032 12,010 22 0.2 Utilities 3,477 3,151 326 10.3 Operating services 18,706 18,943 (237) (1.3) Total property expenses 34,215 34,104 111 0.3 Non-property revenues: Real estate services 897 2,593 (1,696) (65.4) Total non-property revenues 897 2,593 (1,696) (65.4) Non-property expenses: Real estate services expenses 2,920 3,213 (293) (9.1) General and administrative 11,582 18,066 (6,484) (35.9) Transaction related costs 1,345 2,745 (1,400) (51.0) Depreciation and amortization 27,733 28,498 (765) (2.7) Property impairments — 6,041 (6,041) (100.0) Land and other impairments, net 3,900 7,519 (3,619) (48.1) Total non-property expenses 47,480 66,082 (18,602) (28.1) Operating income (loss) (1,869) (20,499) 18,630 1,179.0 Other (expense) income: Interest expense (17,707) (16,554) (1,153) (7.0) Interest and other investment income (loss) 189 95 94 98.9 Equity in earnings (loss) of unconsolidated joint ventures 2,638 349 2,289 655.9 Realized gains (losses) and unrealized gains (losses) on disposition of rental property, net — 3,521 (3,521) (100.0) Gain on disposition of developable land 55,125 111 55,014 49,562.2 Gain (loss) from extinguishment of debt, net (129) (46,735) 46,606 (99.7) Total other (expense) income 40,116 (59,213) 99,329 167.7 Income (loss) from continuing operations 38,247 (79,712) 117,959 148.0 Discontinued operations: Income from discontinued operations 843 3,601 (2,758) (76.6) Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net (4,440) 2,080 (6,520) (313.5) Total discontinued operations (3,597) 5,681 (9,278) (163.3) Net income (loss) $ 34,650 $ (74,031) $ 108,681 146.8 % 2021,2022, as compared to 2020,2021, divided into Same-Store Properties, Acquired and Developed Properties and Properties Sold in 20202021 and 20212022 (excluding properties classified as discontinued operations):(dollars in
thousands)(dollars in
thousands)Total
CompanySame-Store
PropertiesAcquired and Developed
Properties Properties
Sold in 2021 and 2022Dollar
Change Percent
ChangeDollar
Change Percent
ChangeDollar
ChangePercent
ChangeDollar
ChangePercent
ChangeRevenue from rental Revenue from rental Revenue from leases $ 1,114 1.7 % $ 3,471 5.2 % $ 4,073 6.0 % $ (6,430) (9.5) % Parking income 1,270 36.5 1,215 34.9 200 5.7 (145) (4.2) Hotel income 1,822 67.1 1,822 67.1 — — — — Other income (2,371) (67.4) (2,516) (71.5) 169 4.8 (24) (0.7) Total $ 1,835 2.4 % $ 3,992 5.2 % $ 4,442 5.8 % $ (6,599) (8.6) % Property expenses: Real estate taxes $ 22 0.2 % $ 150 1.2 % $ 449 3.7 % $ (577) (4.8) % Utilities 326 10.3 327 10.4 200 6.3 (201) (6.4) Operating services (237) (1.3) 84 0.4 1,280 6.8 (1,601) (8.5) Total $ 111 0.3 % $ 561 1.6 % $ 1,929 5.7 % $ (2,379) (7.0) % OTHER DATA: Number of Consolidated Properties 27 25 2 19 4,350 4,350 — 3,596 Multifamily portfolio (number of units) Multifamily portfolio (number of units) 5,295 4,232 1,063 — $2.7$3.5 million, or 4.15.2 percent, for 20212022 as compared to 2020,2021, due primarily to an increase in lease-upoccupancy, market rental rates and a reduction in concessions of the multifamily rental properties, partially offset by a reduction in 2021occupancy of the office properties in 2022 as compared to 2020.2021.was relatively unchangedincreased $1.2 million, or 34.9 percent, for 20212022 as compared to 2020.2021 due primarily to increased usage at the parking garages in 2022 as compared to 2021.$2.1$1.8 million, or 238.067.1 percent, for 20212022 as compared to 20202021, primarily due to the partial shutdown of hotel operations due to the COVID-19 pandemic in 2020, primarily due to the full re-opening of the hotels occurring in 2021 following a partial shutdown of hotel operations in 2020 as a result of the COVID-19 pandemic.$2.2$2.5 million, or 55.971.5 percent, for 20212022 as compared to 2020,2021, due primarily to a decreasethe recognition in 2021 in foodof a forfeited deposit on a dead deal and beverage income due to the Company’s discontinuation of certain food service operations in Jersey City, New Jersey in late 2020; and a decrease in early lease termination income recognizedpost sales items received in 2021 as compared to 2020.2022.$1.0$0.2 million, or 8.91.2 percent, for 20212022 as compared to 2020,2021, due primarily to the expiration in early 2021 of the PILOT agreements on two multi-familymultifamily properties located in Jersey City, New Jersey.were relatively unchangedincreased $0.3 million, or 10.4 percent, for 20212022 as compared to 2020.2021, due primarily to increased usage in 2022, due to unseasonably warm temperatures.decreased $2.1increased $0.1 million or 10.70.4 percent, for 20212022 as compared to 2020,2021, due primarily to an increase in insurance and marketing expenses of $1.3 million in 2022 as compared to 2021, partially offset by a decrease in propertysalaries and related expenses and repairs and maintenance expensescosts of $1.6$1.2 million in 20212022 as compared to 2020, and $0.7 million in severance and related costs incurred in 2020 with no similar costs in 2021.was relatively unchangeddecreased $1.7 million, or 65.4 percent, for 20212022 as compared to 2020.2021, due primarily to decreased third party development and management activity in 2022 as compared to 2021.was relatively unchangeddecreased $0.3 million, or 9.1 percent, for 20212022 as compared to 2020.2021, due primarily to lower salaries and related expenses from a reduction in third-party services activities in 2022 as compared to 2021.$15.1$6.5 million, or 57.235.9 percent, for 20212022 as compared to 2020.2021. This decrease was due primarily to a $7.8$6.1 million decrease in severance and related costs for 2021 as compared to 2020, and costs incurred in connection with contested elections of the Board of Directors of $7.0 million in 2020, as well as reduced salary and related expenses in 2021 as compared to 2020, with such reductions related to Company’s initiatives to realize run-rate expense savings from internal management reorganizations put in place early in 2021, coincident with plans to streamline the portfolio.2022.Dead deal and transaction-related costs. The Company incurred costs of $3.7 million in 2021 and $2.6 million in 2020 in connection with dead deals and transaction-related activities.$2.4$0.8 million, or 7.62.7 percent, for 20212022 over 2020.2021. This decrease was primarily due to higher depreciation due primarily to fully amortized assets of approximately $2.7 million for Same-Store Properties for 2021 as compared to 2020 a decrease of approximately $0.3$2.3 million for 2021 as compared to 2020 for properties sold or removed from service. service and lower depreciation of fully amortized assets of $2.2 million for Same-Store Properties for 2022 as compared to 2021. These were partially offset by an increase of $0.6 approximately $3.7 million for 20212022 as compared to 20202021 in the Acquired Properties.impairmentsImpairments.. In 2020,2021, the Company recorded a $36.6$6.0 million impairment on its held and used hotel propertiesoffice property located in Weehawken,Hoboken, New Jersey.Jersey; the property has since been sold.2021,2022, the Company recorded net $3.4$3.9 million of impairments on developable land parcels. In 2020,2021, the Company recorded $1.3$7.5 million of impairments on developable land parcels. See Note 12:11: Disclosure of Fair Value of Assets and Liabilities.decreased $5.1increased $1.2 million, or 25.07.0 percent, for 20212022 as compared to 2020. This decrease was2021. The increase is primarily related to the result ofconstruction loan interest on the newly placed in service property, Haus25, this is partially offset by lower average debt balances in 20212022 as compared to 2020,2021, due to the Company’s redemption of its Senior Unsecured Notes in 2021, primarily using proceeds from sales of office properties.2021.decreased $4.7 millionwas relatively unchanged for 20212022 as compared to 2020, due primarily to the recording of a loan loss allowance on a receivable of $5.2 million in 2021.decreased $3.1increased $2.3 million or 225.6 percent for 20212022 as compared to 2020,2021, due primarily to a decrease of $3.0 million for 2021higher revenues resulting from lower concessions, higher occupancy, and higher market rents at various multifamily ventures in 2022 as compared to 2020 from the Urby at Harborside venture, which resulted from the Company’s share of the annual sale of an economic urban tax credit having occurred in the third quarter 2020, but which occurred in an earlier quarter in 2021.lossgain of $3.0$3.5 million in 2021.(loss) on sale from unconsolidated joint ventures. disposition of developable land.In 2021,2022, the Company recordedrecognized a lossgain of $1.9$55.1 million on the sale of its interest in a joint venture which owns an office propertydevelopable land located in West Orange,Windsor, New Jersey. In 2021, the Company recognized a gain of $0.1 million on the sale of land holdings located in Hamilton, New Jersey.operations, some of which were sold during the periods.operations. The Company recognized income from thesediscontinued operations of $0.8 million in 2022 and $3.6 million in 2021, which was due to the sale of majority of the classified properties decreased $18.2 million for 2021 as compared to 2020, due primarily to a decrease in revenuesbefore second quarter of $34.0 million for 2021 as compared to 2020, partially offset by a decrease in operating and other expenses of $13.2 million for 2021 as compared to 2020.2022. The Company recognized a $4.4 million valuation allowance for the remaining property in 2022. In 2021, the Company$0.6$2.1 million on these properties in 2021, and a gain of $15.8 million in 2020.properties. See Note 7: Discontinued Operations to the Financial Statements.loss.Income (loss). Net loss decreasedincome (loss) increased for 2022 to a loss$34.7 million of $25.8 million in 2021income from a loss of $41.1$74.0 million in 2020.2021. The decreaseincrease was due to the factors discussed above.NineSix Months Ended SeptemberJune 30, 20212022 Compared to NineSix Months Ended SeptemberJune 30, 2020
(dollars in thousands) Six Months Ended
June 30,Dollar
ChangePercent
Change2022 2021 Revenue from rental operations and other: Revenue from leases $ 132,832 $ 131,587 $ 1,245 0.9 % Parking income 8,931 6,570 2,361 35.9 Hotel income 5,953 3,767 2,186 58.0 Other income 27,936 7,177 20,759 289.2 Total revenues from rental operations 175,652 149,101 26,551 17.8 Property expenses: Real estate taxes 24,532 23,629 903 3.8 Utilities 7,410 7,243 167 2.3 Operating services 37,106 34,265 2,841 8.3 Total property expenses 69,048 65,137 3,911 6.0 Non-property revenues: Real estate services 1,807 5,119 (3,312) (64.7) Total non-property revenues 1,807 5,119 (3,312) (64.7) Non-property expenses: Real estate services expenses 5,283 6,531 (1,248) (19.1) General and administrative 31,056 32,052 (996) (3.1) Transaction related costs 1,345 2,745 (1,400) (51.0) Depreciation and amortization 53,851 56,276 (2,425) (4.3) Property impairments — 6,041 (6,041) (100.0) Land and other impairments, net 6,832 7,932 (1,100) (13.9) Total non-property expenses 98,367 111,577 (13,210) (11.8) Operating income (loss) 10,044 (22,494) 32,538 1,179.0 Other (expense) income: Interest expense (32,733) (34,164) 1,431 14.7 Interest and other investment income (loss) 347 112 235 209.8 Equity in earnings (loss) of unconsolidated joint ventures 2,151 (1,107) 3,258 (294.3) Realized gains (losses) and unrealized gains (losses) on disposition of rental property, net 1,836 3,521 (1,685) (47.9) Gain on disposition of developable land 57,748 111 57,637 51925.2 Gain (loss) from extinguishment of debt, net (6,418) (46,735) 40,317 (86.3) Total other (expense) income 22,931 (78,262) 101,193 9.8 Income (loss) from continuing operations 32,975 (100,756) 133,731 (132.7) Discontinued operations: Income from discontinued operations 1,588 15,385 (13,797) (89.7) Realized gains (losses) and unrealized gains (losses) on disposition of rental property and impairments, net (4,440) 24,861 (29,301) (117.9) Total discontinued operations (2,852) 40,246 (43,098) (107.1) Net income (loss) $ 30,123 $ (60,510) $ 90,633 (149.8) % 20212022, as compared to 20202021, divided into Same-Store Properties, Acquired and Developed Properties and Properties Sold in 20202021 and 20212022 (excluding properties classified as discontinued operations):(dollars in
thousands)(dollars in
thousands)Total
CompanySame-Store
PropertiesAcquired and Developed
Properties Properties
Sold in 2021 and 2022Dollar
Change Percent
ChangeDollar
Change Percent
ChangeDollar
ChangePercent
ChangeDollar
ChangePercent
ChangeRevenue from rental Revenue from rental Revenue from leases $ 1,245 0.9 % $ 1,930 1.5 % $ 10,460 7.9 % $ (11,145) (8.5) % Parking income 2,361 35.9 2,029 30.9 538 8.2 (206) (3.1) Hotel income Hotel income 2,186 58.0 2,186 58.0 — — — — Other income 20,759 289.2 20,396 284.2 275 3.8 88 1.2 Total $ 26,551 17.8 % $ 26,541 17.8 % $ 11,273 7.6 % $ (11,263) (7.6) % Property expenses: Real estate taxes $ 903 3.8 % $ 561 2.4 % $ 1,357 5.7 % $ (1,015) (4.3) % Utilities 167 2.3 55 0.8 465 6.4 (353) (4.9) Operating services 2,841 8.3 3,186 9.3 2,584 7.5 (2,929) (8.5) Total $ 3,911 6.0 % $ 3,802 5.8 % $ 4,406 6.8 % $ (4,297) (6.6) % OTHER DATA: Number of Consolidated Properties 27 24 3 19 4,350 4,350 — 3,596 Multifamily portfolio (number of units) Multifamily portfolio (number of units) 5,295 4,039 1,256 — decreased $4.4increased $1.9 million, or 2.11.5 percent, for 20212022 as compared to 2020,2021, due primarily to an increase in lease-up of the multifamily rental properties, partially offset by a decreasereduction in 2021 in rental rates in multi-family properties and in overall occupancy of the office portfolio.properties in 2022 as compared to 2021.decreased $2.1increased $2.0 million, or 16.830.9 percent, for 20212022 as compared to 2020,2021 due primarily to decreasedincreased usage at the parking garages in 2021,2022 as compared to 2020, which was more impacted by the COVID-19 pandemic, as well as the recognition in 2020 of approximately $0.6 million income from a settlement of prior period unpaid parking fees by a tenant in Jersey City, New Jersey.2021.$3.5$2.2 million, or 106.258.0 percent, for 20212022 as compared to 20202021, primarily due to the partial shutdown of hotel operations due to the COVID-19 pandemic in 2020, primarily due to full reopening of the hotels occurring in 2021 following a partial shutdown of hotel operations in 2020 as a result of the COVID-19 pandemic.$1.8$20.4 million, or 25.6284.2 percent, for 20212022 as compared to 2020,2021, due primarily to the recognitionearly lease termination income from office properties recognized in 2021 of forfeited deposits received from the potential buyers in disposition deals that were not completed, as well as post property sales items received in 2021.2022.$2.3$0.6 million, or 6.92.4 percent, for 20212022 as compared to 2020,2021, due primarily to the expiration in early 2021 of the PILOT agreements on two multi-familymultifamily properties located in Jersey City, New Jersey.wereremained relatively unchanged for 2021 as2022 compared to 2020.2021.was relatively unchangedincreased $3.2 million, or 9.3 percent, for 20212022 as compared to 2020,2021, due primarily to a decreasean increase in property maintenance, insurance and operationsmarketing expenses of $3.1 million in 20212022 as compared to 2020, partially offset by an increase in severance and related expenses for 2021 as compared to 2020.2021.$0.9$3.3 million, or 10.264.7 percent, for 20212022 as compared to 2020,2021, due primarily to decreased third party development and management activity in 2021,2022 as compared to 2020.2021.$0.3$1.2 million, or 2.719.1 percent, for 20212022 as compared to 2020,2021, due primarily to decreasedlower salaries and related expenses from lower third party development and managementa reduction in third-party services activities in 2021,2022 as compared to 2020.2021.expenseexpenses decreased $16.1$1.0 million, or 27.13.1 percent, for 20212022 as compared to 2020.2021. This decrease in 2022 was due primarily to costs incurred for a contested electionan increase of the Board of Directors of $12.8 million in 2020 and a decrease in severance and related costs of $3.7 million for 2021 as compared to 2020, as well as reduced salary and related expenses in 2021 as compared to 2020, with such reductions related to Company’s initiatives to realize run-rate expense savings from internal management reorganizations put in place early in 2021, coincident with plans to streamline the portfolio. These were partially offset by $2 million of costs from CEO and related management changes,change costs in 2021.Dead deal and transaction-related costs. The Company incurred costs of $6.4 million in 2021 and $2.6 million in 2020 in connection with its property transaction activities.$6.7$2.4 million, or 7.24.3 percent, for 20212022 over 2020.2021. This decrease was primarily due to lower depreciation due primarily to fully amortized assets of approximately $7.1 million for Same-Store Properties for 2021 as compared to 2020, and a decrease of approximately $0.9$4.7 million in 2021 as compared to 2020 for properties sold or removed from service. service and lower depreciation of fully amortized assets of $3.8 million for Same-Store Properties for 2022 as compared to 2021. These were partially offset by an increase of approximately $1.3$6.1 million for 20212022 as compared to 20202021 in the Acquired Properties.impairmentsImpairments.. In 2021, the Company recorded a $6.0 million impairment on its then-classified held and used office property located in Hoboken, New Jersey. In 2020,Jersey; the Company recorded a $36.6 million impairment on its held and used hotel properties located in Weehawken, New Jersey.property has since been sold.2021,2022, the Company recorded $11.3 million of impairment on developable land parcels. In 2020, the Company recorded $23.4net $6.8 million of impairments on developable land parcels. In 2021, the Company recorded $7.9 million of impairments on developable land parcels. See Note 12:11: Disclosure of Fair Value of Assets and Liabilities.$12.4$1.4 million, or 20.114.7 percent, for 20212022 as compared to 2020.2021. This decrease was primarily the result of lower average debt balances in 20212022 as compared to 2020,2021, due to the Company’s redemption of its Senior Unsecured Notes in 2021, primarily using proceeds from sales of office properties.2021.decreased $4.7 millionremained relatively unchanged for 2021 as2022 compared to 2020, due primarily to the recording of a loan loss allowance on a receivable of $5.2 million in 2021.decreased $2.6increased $3.3 million, or 907.5294.3 percent for 20212022 as compared to 2020,2021, due primarily to a decrease of $2.0 million for 2021 as compared to 2020higher revenues resulting from the Urby at Harborside venture which resulted from an increase inlower concessions and discounts to tenants at various multifamily ventures in 20212022 as compared to 2020. Additionally, a joint venture of the Company agreed to settle certain obligations regarding a previously owned development project, of which the Company’s share of the expense for such settlement was $0.9 million, which was recorded in equity in earnings (loss) in 2021.$0.5$1.8 million in 2021 and2022 on the disposition of an office property located in Hoboken, New Jersey compared to a net lossgain of $7.9$3.5 million in 2020.2021.recordedrecognized a gain of $0.1 million on the sale of land holdings located in Hamilton, New Jersey.2020,2022, the Company recordedrecognized a gainloss of $4.8$6.4 million on extinguishment of debt primarily in connection with the sale of land holdings located in Middletown, New Jersey.Gain (loss) on sale from unconsolidated joint ventures. In 2021, the Company recorded a loss of $1.9 million on the sale of its interest in a joint venture which owns an office property located in West Orange,Hoboken, New Jersey.Loss from early extinguishment of debt, net. The In 2021, the Company recognized losses from early extinguishment of debt of $46.7 million, in 2021 which consists of costs incurred of $24.2 million in connection with the redemption of the Company’sCompany's Senior Unsecured Notes and defeasement of the mortgage loan with the sale of Company’sthe Company's Short Hills office portfolio. See Note 8: Senior Unsecured Notes and Note 10: Mortgages, Loans Payable and Other Obligations.3637 office properties totaling 6.3 million square feet as discontinued operations. Income from discontinued operations some of which were sold during the periods. The income from these properties decreased $46.1by $13.8 million for 2021 as2022 compared to 2020,2021 primarily due primarily to the sale of majority of the properties taking place before 2022. In 2022, the Company recognized a decrease in revenuesvaluation allowance of $84.1$4.4 million foron the remaining property. In 2021, as compared to 2020, partially offset by a decrease in operating and other expenses of $32.6 million for 2021 as compared to 2020. Thethe Company recognized realized gains (losses) and unrealized losses on disposition of rental property and impairments, net, of a gain of $25.5$24.9 million on these properties in 2021, and a loss of $23.9 million in 2020.properties. See Note 7: Discontinued Operations to the Financial Statements.loss.Income (loss). Net loss decreasedincome (loss) increased to a lossincome of $86.3$30.1 million million in 20212022 from a loss of $111.9$60.5 million in 2020.2021. The decreaseincrease was due to the factors discussed above.Historically, rentalhas beenis the Company’s principal source of funds to pay its material cash commitments consisting of operating expenses, debt service, capital expenditures and dividends, excluding non-recurring capital expenditures. To the extent that the Company’s cash flow from operating activities is insufficient to finance its non-recurring capital expenditures such as property acquisitions, development and construction costs and other capital expenditures, the Company has and expects to continue to finance such activities through borrowings under its revolving credit facility, other debt and equity financings, proceeds from the sale of properties and joint venture capital.drawdraws from its revolving credit facility.Company frequently examines potential property acquisitionsCOVID-19 pandemic continues to have a significant impact in the U.S. and development projects and, at any given time, one or more of such acquisitions or development projects may be under consideration. Accordingly, the ability to fund property acquisitions and development projects is a major part of the Company’s financing requirements. The Company expects to meet its financing requirements through funds generated from operating activities, to the extent available, proceeds from property sales, joint venture capital, long-term and short-term borrowings (including draws on the Company’s revolving credit facility) and the issuance of additional debt and/or equity securities.The ongoing impact of COVID-19 across many countries around the globe, including the U.S., has slowed global economic activity, caused significant volatility in financial markets, and resulted in unprecedented job losses causing many to fear an imminent global recession. The global impact of the outbreak has been rapidly evolving the responses of many countries, including the U.S., have included quarantines, restrictions on business activities, including construction activities, restrictions on group gatherings, and restrictions on travel. These actions are creating disruption in the global economy and supply chains and adversely impacting many industries, including owners and developers of office and mixed-use buildings. Moreover, there is significant uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. economy and consumer confidence. Demand for space at the Company’s properties is dependent on a variety of macroeconomic factors, such as employment levels, interest rates, changes in stock market valuations, rent levels and availability of competing space. These factors can be significantly adversely affected by a variety of factors beyond the Company’s control.globe. The extent to which COVID-19 impacts the Company’s results will depend on future developments, many of which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions taken to contain it or treat its impact. If the outbreak continues, there will likelymay be continued negative economic impacts, market volatility, and business disruption which could negatively impact the Company’s tenants’ ability to pay rent, the Company’s ability to lease vacant space, the Company’s ability to complete development and redevelopment projects and the Company’s ability to dispose of the assets held for sale and these consequences, in turn, could materially impact the Company’s results of operations.Construction ProjectsThe Company is developing a 750-unit multi-family project at 25 Christopher Columbus, also known as Haus 25, in Jersey City, New Jersey, which began construction in first quarter 2019. The construction project, which is estimated to cost $469.5 million, of which $406.8 million has been incurred through September 30, 2021, is expected to be ready for occupancy in first quarter 2022. The Company has funded $169.5 million of the construction costs, and the remaining construction costs are expected to be funded from a $300 million construction loan (of which $237.3 million was drawn as of September 30, 2021). The dividends paid for 2020 are expected to fully satisfy the above minimum distribution requirement.dividendsdividend obligations as a REIT on taxable income expected for 2020, the Board made the strategic decision to suspend its common dividends and distributions for the remainder of 2020 in an effort to provide greater financial flexibility during the pandemic and to retain incremental capital to support leasing initiatives at its Harborside commercial office properties on the Jersey City waterfront. On March 19, 2021, the Company announced that its Board of Directors would continue to suspend its common dividend for the remainder of 2021 in order to conserve capital and allow for greater financial flexibility during this period of heightened economic uncertainty and based on the Company’s then projected 2021 taxable income estimates. The Company believes that with this suspension,its taxable income/loss for 2021, it will satisfyhas met its dividends obligationdividend obligations as a REIT on taxable income estimated for 2021.Through February 2016, thecould not dispose of or distribute certain of its properties which were originally contributedacquired by certaincontribution from unrelated common unitholders of the Operating Partnership without the express written consent of such common unitholders, as applicable,were subject to restrictions on disposition, except in a manner which did not result in recognition of any built-in-gain (which may result in an income tax liability)allocable to such unitholders or which reimbursed the appropriate specific common unitholders for the tax consequences of the recognition of such built-in-gainsthereof (collectively, the “Property Lock-Ups”Lock-Upon the expiration in February 2016 of theWhile these Property Lock-Ups have expired, the Company is generally required to use commercially reasonable efforts to prevent any sale, transfer or other disposition of the subject properties from resulting in the recognition of built-in gain to the specific commonthese unitholders, which include members of the Mack Group (which includes William L. Mack, a former director;director and David S. Mack, a former director; and Earle I. Mack, a former director), the Robert Martin Group, and the Cali Group (which includes John R. Cali, a former director). As of SeptemberJune 30, 2021, after the effects of2022, taking into account tax-free exchanges on certain of the originally contributed properties, either wholly or partially, over time, five of the Company’s properties, as well as certain land and development projects, including properties classified as held for sale as of September 30, 2021, with an aggregate carrying value of approximately $1.0 billion, are subject to these conditions.SeptemberJune 30, 2021,2022, the Company had twoone unencumbered propertiesproperty with a carrying value of $42.0$17.0 million representing 7.13.7 percent of the Company’s total consolidated property count.$9.2$2.0 million to $43.1$53.4 million at SeptemberJune 30, 2021,2022, compared to $52.3$51.5 million at December 31, 2020.2021. This increase is comprised of the following net cash flow items:(1)$41.2 million provided by operating activities.(2) $458 million provided by investing activities, consisting primarily of the following:(a)$620.8 million net cash from investing activities - discontinued operations; plus(b)$0.5 million received from repayments of notes receivables; plus(c)$5.7 million received from distributions in excess of cumulative earnings from unconsolidated joint ventures; plus(d)$42.7 million received from proceeds from the sales of rental property; plus(e)$3.9 million received from proceeds from the sale of investments in unconsolidated joint ventures; minus(f)$0.6 million used for investments in unconsolidated joint ventures; minus(g)$49.1 million used for additions to rental property and improvements; minus(h)$165.7 million used for the development of rental property, other related costs and deposits.(3)$508.4 million used in financing activities, consisting primarily of the following:(a)$37 million used for repayments of revolving credit facility and term loan; plus(b)$150 million used for repayment of term loans; plus(c)$573.7 million used for repayments of unsecured term loans; plus(d)$129.9 million used for repayments of mortgages, loans payable and other obligations; plus(e)$0.6 million used for common unit redemptions; plus(f)$7.3 million used for payment of finance costs; plus(g)$19.4 million used for distribution to redeemable noncontrolling interests; plus65(2)Table$155.1 million provided by investing activities, consisting primarily of Contentsthe following:(h)$49.9 million used for payment of early debt extinguishment costs, plus(i)$0.5 million used for payments of common dividends and distributions;(b)$7.5 million received from distributions in excess of cumulative earnings from unconsolidated joint ventures; minus(j)$186 million from borrowings under the revolving credit facility; minus(k)$123.7 million from proceeds received from mortgages and loans payable; minus(l)$0.2 million from contributions from noncontrolling interests; minus(m)$150 million from borrowings from term loan.SeptemberJune 30, 2021:Weighted Average
Maturity in YearsFixed Rate Secured Fixed Rate Secured $ 1,532,416 68.50 % 3.70 % 4.51 Variable Rate Secured Debt (c) Variable Rate Secured Debt (c) 704,672 31.50 % 3.72 % 2.93 Totals/Weighted Average: $ 2,237,088 100.00 % 3.70 % (b) 4.02 Unamortized deferred financing costs (9,599) Total Debt, Net $ 2,227,489 0.111.03 percent as of SeptemberJune 30, 2021,2022 plus the applicable spread.(b)Balance includes two ten-year mortgage loans obtained by the Company which have fixed rates for the first five years only.(c)Excludes amortized deferred financing costs primarily pertaining to the Company’s revolving credit facility which amounted to $2.3 million for the nine months ended September 30, 2021.Debt MaturitiesScheduled principal payments and related weighted average annual effective interest rates for the Company’s debt asTable of September 30, 2021 are as follows:Contents(a)The actual weighted average LIBOR rate for the Company’s outstanding variable rate debt was 0.11 percent as of September 30, 2021, plus the applicable spread.$2.3$0.7 million and $1.4 million for the ninethree and six months ended SeptemberJune 30, 2021.2022, respectively.Senior Unsecured NotesIncludes debt with interest rate caps outstanding with a notional amount of $185 million.On May 6, 2021,Company retired these notes earlier than their maturity, using net sales proceeds from completed suburban office property sales and borrowings under its 2021Company’s debt as of June 30, 2022 are as follows:Period Weighted Avg.
Effective Interest Rate of
Future Repayments (a)2022 $ 305 $ — $ 305 4.85 % 2023 2,047 147,998 150,045 4.22 % 2024 (b) 3,403 675,672 679,075 4.04 % 2025 3,300 — 3,300 3.98 % 2026 3,407 733,000 736,407 3.58 % Thereafter 9,414 658,542 667,956 3.38 % Sub-total 21,876 2,215,212 2,237,088 3.70 % Unamortized deferred financing costs (9,599) — (9,599) Totals/Weighted Average $ 12,277 $ 2,215,212 $ 2,227,489 3.70 % (c) term loan. In conjunction with$1.4 million for the notes being discharged, the Company incurred costs of $24.2 million (including a make-whole premium) which was expensed as loss from extinguishment of debt during the ninethree and six months ended SeptemberJune 30, 2021. See Note 9: Revolving Credit Facility and Term Loans.2022, respectively.include:included: (1) an eighteen month term ending in November 2022; (2) a single draw of the term loan commitments up to an aggregate principal amount of $150 million; and (3) a first priority lien in unencumbered properties of the Company with an appraised value greater than or equal to $800 million which must include the Company’s Harborside 2/3 and Harborside 5 properties. Furthermore, construction loans secured by two multi-family residential property development projects contain cross-acceleration provisions that would constitute an event of default requiring immediate repayment of the construction loans if the change of control provisions under the 2021 Credit Facility are triggered and the lenders declare a default and exercise their rights under the 2021 Credit Facility and accelerate repayment of the outstanding borrowings thereunder. If these change of control provisions were triggered, the Company could seek a forbearance, waiver or amendment of the change of control provisions from the lenders, however there can be no assurance that the Company would be able to obtain such forbearance, waiver or amendment on acceptable terms or at all. If an event of default has occurred and is continuing, the entire outstanding balance under the 2021 Credit Agreement may (or, in the case of any bankruptcy event of default, shall) become immediately due and payable, and the Company will not make any excess distributions except to enable the General Partner to continue to qualify as a REIT under the IRS Code. (See Note 3: Recent Transactions – Real Estate Held for Sale/Discontinued Operations/Dispositions).The terms of the 2017 credit facility included: (1) a four-year term ending in January 2021, with two six-month extension options, subject to the Company not being in default on the facility and with the payment of a fee of 7.5 basis points for each extension; (2) revolving credit loans may be made to the Company in an aggregate principal amount of up to $600 million, with a sublimit under the2017 credit facility for the issuance of letters of credit in an amount not to exceed $60 million (subject to increase as discussed below), of which $10.6 million of letters of credit had been issued as of May 6, 2021; (3) an interest rate based on the Operating Partnership’s unsecured debt ratings from Moody’s or S&P, or, at the Operating Partnership’s option, if it no longer maintained a debt rating from Moody’s or S&P or such debt ratings fell below Baa3 and BBB-, based on a defined leverage ratio; and (4) a facility fee, payable quarterly based on the Operating Partnership’s unsecured debt ratings from Moody’s or S&P, or, at the Operating Partnership’s option, if it no longer maintained a debt rating from Moody’s or S&P or such debt ratings fell below Baa3 and BBB-, based on a defined leverage ratio. In January 2021, the Company elected to exercise the first option to extend the 2017 credit facility maturity date for a period of six months. Accordingly, the term of the 2017 credit facility was extended through its termination in May 2021, with the Company’s payment of the 7.5 basis point extension fee.After electing to use the defined leverage ratio in 2018 to determine the interest rate, the interest rate under the 2017 credit facility was based on the following total leverage ratio grid: and term loan, or its mortgages, loans payable and other obligations upon maturity. Instead, the Company will seek to retire such debt primarily with available proceeds to be received from the Company’s planned sales of its Suburban Office Portfolio assets, as well as obtaining additional mortgage financings on or before the applicable maturity dates. If it cannot raise sufficient proceeds to retire the maturing debt, the Company may draw on its revolving credit facility to retire the maturing indebtedness, which would reduce the future availability of funds under such facility. As of NovemberAugust 1, 2021,2022, the Company had outstanding borrowings of $166$114 million under its revolving credit facility and no outstanding borrowings under its term loan.facility. The Company is reviewing various financing and refinancing options, including the redemption or purchase of the senior unsecured notes in public tender offers or privately-negotiated transactions, the issuance of additional, or exchange of current, unsecured debt of the Operating Partnership or common and preferred stock of the General Partner, and/or obtaining additional mortgage debt of the Operating Partnership, some or all of which may be completed in 2021.2022. The Company currently anticipates that its available cash and cash equivalents, cash flows from operating activities and proceeds from the sale of real estate assets and joint ventures investments, together with cash available from borrowings and other sources, will be adequate to meet the Company’s capital and liquidity needs in the short term. However, if these sources of funds are insufficient or unavailable, due to current economic conditions or otherwise, or if capital needs to fund acquisition and development opportunities in the multi-familymultifamily rental sector arise, the Company’s ability to make the expected distributions discussed in “REIT Restrictions” above may be adversely affected.Share/Unit Repurchase ProgramThe General Partner has a share repurchase program which was renewed and authorized by its Board of Directors in September 2012 to purchase up to $150 million of the General Partner’s outstanding common stock (“Repurchase Program”), which it may repurchase from time to time in open market transactions at prevailing prices or through privately negotiated transactions. As of September 30, 2021, the General Partner has a remaining authorization under the Repurchase Program of $139 million. There were no common stock repurchases in the year ended December 31, 2020 and through November 1, 2021. NovemberAugust 1, 2021.NovemberAugust 1, 2021.Such guaranteed debt has a total facility amount of $303.8 million of which the Company has agreed to guarantee up to $33.2 million. As of SeptemberJune 30, 2021,2022, the outstanding balance of such guaranteed debt, totaled $295.8$189.8 million of which $32.4$22 million was guaranteed by the Company.Contractual ObligationsThe following table outlines the timing of payment requirements related to the Company’s debt (principal and interest), PILOT agreements, ground lease agreements and other obligations, as of September 30, 2021:(a)Interest payments assume LIBOR rate of 0.10 percent, which is the weighted average rate on its outstanding variable rate mortgage debt at September 30, 2021, plus the applicable spread. (b)Includes $136.8 million pertaining to various mortgages with one-year extension options.(c)Includes $237.3 million pertaining to various mortgages with one-year extension options.estate-relatedestate-related depreciation and amortization. The Company believes that FFO is helpful to investors as one of several measures of the performance of an equity REIT. The Company further believes that as FFO excludes the effect of depreciation, gains (or losses) from property transactions and impairments related to depreciable rental property (all of which are based on historical costs which may be of limited relevance in evaluating current performance), FFO can facilitate comparison of operating performance between equity REITs.ninesix months ended SeptemberJune 30, 20212022 and 20202021 (in thousands):Three Months Ended
June 30,Six Months Ended
June 30,2022 2021 2022 2021 Net income (loss) available to common shareholders $ 26,373 $ (72,079) $ 17,281 $ (64,456) Add (deduct): Noncontrolling interests in Operating Partnership 3,029 (7,742) 2,064 (10,122) Noncontrolling interests in discontinued operations (334) 517 (267) 3,659 Real estate-related depreciation and amortization on continuing operations (a) 29,980 30,702 58,444 60,432 Real estate-related depreciation and amortization on discontinued operations 296 647 691 1,699 Property impairments on continuing operations — 6,041 — 6,041 Impairment of unconsolidated joint venture investment — (2) — (2) Continuing operations: Realized (gains) losses and unrealized (gains) losses on disposition of rental property, net — (3,521) (1,836) (3,521) Discontinued operations: Realized (gains) losses and unrealized (gains) losses on disposition of rental property, net 4,440 (2,080) 4,440 (24,861) Funds from operations available to common stock and Operating Partnership unitholders (b) $ 63,784 $ (47,517) $ 80,817 $ (31,131) $2,605$2.6 million and $3,331$2.5 million for the three months ended SeptemberJune 30, 20212022 and 2020,2021, respectively and $7,413$5.2 million and $10,020$4.8 million for the ninesix months ended SeptemberJune 30, 20212022 and 2020,2021, respectively. Excludes non-real estate-related depreciation and amortization of $325$0.3 million and $336$0.3 million for the three months ended SeptemberJune 30, 20212022 and 2020,2021, respectively and $979$0.7 million and $1,268$0.7 million for the ninesix months ended SeptemberJune 30, 2022 and 2021, and 2020, respectively.SeptemberJune 30, 2022 and 2021 included $3.9 million and 2020 included $3,401 and $1,292,$7.5 million, respectively, of land impairment charges and no$55.1 million and $0.1 million, respectively, gains on disposition of developable land, which are included in the calculation to arrive at funds from operations as such gains relate to non-depreciable assets. Net income available to common shareholders for the ninesix months ended SeptemberJune 30, 2022 and 2021 included $6.8 million and 2020 included $11,333 and $23,401,$7.9 million, respectively, of land impairment charges and $111$57.7 million and $4,813,$0.1 million, respectively, from gains on disposition of developable land, which are included in the calculation to arrive at funds from operations as such gains relate to non-depreciable assets.InflationThe Company’s leases with the majority of its commercial tenants provide for recoveries and escalation charges based upon the tenant’s proportionate share of, and/or increases in, real estate taxes and certain operating costs, which reduce the Company’s exposure to increases in operating costs resulting from inflation. The Company believes that inflation did not materially impact the Company’s results of operations and financial condition for the periods presented.Disclosure Regarding Forward-Looking Statements2020,2021, as well as the risks set forth below, as being heightened as a result of the ongoing and numerous adverse impacts of COVID-19.•risks and uncertainties affecting the general economic climate and conditions, which in turn may have a negative effect on the fundamentals of our business and the financial condition of our tenants and residents;•the value of our real estate assets, which may limit our ability to dispose of assets at attractive prices or obtain or maintain debt financing collateralized secured by our properties or on an unsecured basis;•the extent of any tenant bankruptcies or of any early lease terminations;•our ability to lease or re-lease space at current or anticipated rents;•changes in the supply of and demand for our properties;•changes in interest rate levels and volatility in the securities markets;•our ability to complete construction and development activities on time and within budget, including without limitation obtaining regulatory permits and the availability and cost of materials, labor and equipment;•our ability to attract, hire and retain qualified personnel;•changes in operating costs;•our ability to obtain adequate insurance, including coverage for natural disasters and terrorist acts;•our credit worthiness and the availability of financing on attractive terms or at all, which may adversely impact our ability to pursue acquisition and development opportunities and refinance existing debt and our future interest expenseexpense;;•changes in governmental regulation, tax rates and similar matters; and•other risks associated with the development and acquisition of properties, including risks that the development may not be completed on schedule, that the tenants or residents will not take occupancy or pay rent, or that development or operating costs may be greater than anticipated.2020.2021. We assume no obligation to update and supplement forward-looking statements that become untrue because of subsequent events, new information or otherwise.
$1.7$1.5 billion of the Company’s long-term debt as of SeptemberJune 30, 20212022 bears interest at fixed rates and therefore the fair value of these instruments is affected by changes in market interest rates. The following table presents principal cash flows (in thousands) based upon maturity dates of the debt obligations and the related weighted-average interest rates by expected maturity dates for the fixed rate debt. The interest rates on the Company’s variable rate debt as of SeptemberJune 30, 20212022 ranged from LIBOR plus 184158 basis points to LIBOR plus 340 basis points. Assuming interest-rate swaps and caps are not in effect, if market rates of interest on the Company’s variable rate debt increased or decreased by 100 basis points, then the increase or decrease in interest costs on the Company’s variable rate debt would be approximately $7.0 million annually and the increase or decrease in the fair value of the Company’s fixed rate debt as of SeptemberJune 30, 20212022 would be approximately $81.5$56.8 million.7/1/22 -
12/31/20222023 2024 2025 2026 Sub-total Other (a) Fixed Rate $ 305 $ 61,045 $ 311,403 $ 3,300 $ 598,407 $ 557,956 $ 1,532,416 $ (5,504) $ 1,526,912 $ 1,447,110 Weighted Average Interest Rate 4.85 % 3.59 % 3.43 % 3.98 % 3.85 % 4.04 % 3.70 % Variable Rate $ — $ 89,000 $ 367,672 $ — $ 138,000 $ 110,000 $ 704,672 $ (4,095) $ 700,577 $ 700,577 SeptemberJune 30, 2021.2022..Mack-Cali Realty Corporationreportingreporting.. Mack-Cali Realty,
MACK-CALI REALTY CORPORATIONMACK-CALI REALTY,VERIS RESIDENTIAL, INC.20202021 of the General Partner and the Operating Partnership.(a) None.(b) Not Applicable.(a) Not Applicable.(a) Not Applicable.hereto.
MACK-CALI REALTY CORPORATIONMACK-CALI REALTY,VERIS RESIDENTIAL, INC.
NumberExhibit Number3.110.1#3.23.33.43.53.63.73.83.93.103.113.123.133.143.153.163.173.183.194.14.24.34.44.54.64.74.84.94.104.114.124.134.144.154.164.174.184.1910.110.2#10.3#10.4#10.5#10.610.710.810.910.1010.1110.1210.1310.14#10.15#10.1610.1710.2#10.1810.19#10.20#10.3#10.21#10.2210.2310.4#10.2410.2510.5#10.2610.27#10.2810.2910.6#10.3010.3110.3210.3310.3410.3510.36#10.37#10.7#10.38#10.39#10.4010.4110.42#10.43#10.44#10.45#10.46#10.47#10.48#10.49#10.50#10.51#10.52#10.5310.5410.5510.5610.5710.58#10.59#10.60#10.61#Mack-Cali Realty CorporationVeris Residential, Inc. and Mack-Cali Realty,Veris Residential, L.P. from their combined Report on Form 10-Q for the quarter ended SeptemberJune 30, 20212022 formatted in Inline XBRL: (i) Consolidated Balance Sheets (unaudited), (ii) Consolidated Statements of Operations (unaudited), (iii) Consolidated Statements of Comprehensive Income (Loss) (unaudited), (iv) Consolidated Statements of Changes in Equity (unaudited), (v) Consolidated Statements of Cash Flows (unaudited) and (vi) Notes to Consolidated Financial Statements (unaudited).* filed herewith# management contract or compensatory plan or arrangement
MACK-CALI REALTY CORPORATIONMACK-CALI REALTY,VERIS RESIDENTIAL, INC.Mack-Cali Realty CorporationVeris Residential, Inc.(Registrant) NovemberAugust 3, 20212022Mahbod Nia Chief Executive Officer (principal executive officer) /s/ Amanda Lombard Amanda Lombard Date:November 3, 2021By:/s/ David J. SmetanaDavid J. Smetana(principal financial officer)Date:November 3, 2021By:/s/ Giovanni M. DeBariGiovanni M. DeBariChief Accounting Officer(officer and principal accounting officer)Mack-Cali Realty, L.P.(Registrant)Veris Residential, L.P.By: Mack-Cali Realty Corporation(Registrant)By: Veris Residential, Inc. its General Partner NovemberAugust 3, 20212022Mahbod Nia Chief Executive Officer (principal executive officer) /s/ Amanda Lombard Amanda Lombard Date:November 3, 2021By:/s/ David J. SmetanaDavid J. Smetana(principal financial officer)Date:November 3, 2021By:/s/ Giovanni M. DeBariGiovanni M. DeBariChief Accounting Officer(officer and principal accounting officer)