Mack-Cali Real Estate Unloads Its Two Oldest Residential Properties

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Roseland Residential, the residential arm of Mack-Cali Real Estate, has sold its interest in its two residential properties, and refinanced a third property that was stabilized in 2020, Commercial Observer has learned. 

The Jersey City-based firm sold its interest in the 825-unit Crystal House Apartments in Arlington, Va., which is located near Amazon’s HQ2. The gross value for the Arlington property was $40 million for the land and $337 million for the operating property, while Roseland’s interest was 50 percent of the former and 25 percent of the latter.

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The company also sold Riverwatch Commons, a 200-unit apartment complex in New Brunswick, New Jersey for $47 million. The complex has addresses at 5 Dennis Street, 10 Dennis Street, and 100 Hiram Square.  

“It was part of our strategic plan before COVID, and we executed this amidst COVID,” said Gabriel Shiff, Roseland’s chief operating officer. The two properties were the oldest among Roseland’s portfolio, having been built in 1962 for Crystal House and 1997 for Riverwatch Commons, per Shiff. “No other asset in our portfolio was built before 2003,” he said. “This significantly improved our age profile.”

Roseland plans to deliver three new properties in the first quarter of 2021 with a total of approximately 900 units, including one development in Short Hills, and two in Weehawken, just across the river from Manhattan. “We’re basically replacing our oldest inventory with our brand new in our strategic core markets.”

The cap rates on the Arlington property was 3.01 percent on trailing 12-month net operating income (NOI), and approximately 3.75 percent on the Riverwatch property, also on the 12-month trailing NOI, according to a source with knowledge of the matter.

Roseland also refinanced The Emery, a newly developed 326-unit rental property in Malden, Mass., replacing a $60 construction loan with a $72 million mortgage from New York Community Bank. Roseland began leasing the property in February and had leased 300 units, or 93 percent, by year end.