Interestingly, average rents at Harborside have been in the range of $31 psf - $32 psf, and Ravesloot expects rents in the new towers will similarly be in the low-to-mid $30s. "This compares to class-A space at $40 psf in Manhattan," he says. "Even class-B space in Downtown Manhattan is in the mid-to-high $30s."
Of course, Jersey City has not historically sold itself solely on the basis of offering cheaper rents. The city’s major sales draw has long been its tax and business incentives. Furthermore, Jersey City (where usable area is determined by BOMA standards) reportedly has much lower loss factors. By comparison, New York space is based on Real Estate Board of New York standards, which are deemed to be much more favorable to the property owner. As such, it’s estimated one would rent 15% - 20% more space in New York than in New Jersey.
Ultimately, Ravesloot boasts: "Harborside—in addition to being the largest development along the waterfront—is the largest office development in New Jersey." To his way of thinking, that translates into tenant numbers big enough to support 750,000 sf of retail and service components. In short, he says: "It provides a community as opposed to just a place to work. It’s all retail geared to service the tenants. It’s not fashion. It’s the restaurants, drug stores, etc. In the final analysis, it’s all the retail employees need...and it’s all located within the development itself."
Mack-Cali Realty Corp.: Capitalizing On Its National Reach
IN ACCORDING Mack-Cali its BBB credit rating, DCR (the rating agency) noted the company has increased its assets three-fold over the past two years. Last year, Mack-Cali continued to build its Northern New Jersey holdings with $240 million in acquisitions that included the Prudential Business Campus, encompassing 875,000 sf of office space, and the adjacent Morris County Financial Center, which came with additional land that can be developed. (Mack-Cali also acquired Pacifica Holding Co—a 1.4 million-sf portfolio in one of Denver, CO’s strongest submarkets—for $188 million.)
In other ventures, Mack-Cali also expanded its position in San Francisco where it acquired a downtown office building in a joint venture with New York City investor Alvin Dworman, and soon expects to announce another acquisition in a joint venture with High Ridge Partners, owned by California investors Eugene Rosenfeld and John Long.
"We are building in California on a very selective spec basis," Mack-Cali president and chief operating officer Mitchell E. Hersh explains. "As such, we have a class-A high-tech/flex development in Carroll Mesa, San Diego, where the basic tenant base is comprised of service providers and entrepreneurial companies aligned with the telecommunications industry. We’re also developing at Lava Ridge in Sacramento, again in tandem with High Ridge Partners."
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