Before I review the specific of the third quarter however, I would just reiterate what most of you already know, and what you have undoubtedly heard on other earnings calls. The headwinds in the economy remain quite stiff and there has been little progress made as we all know in restoring employment in the nation.Naturally, this affects all of our businesses. Without dwelling on prognostications, let’s hope that greater clarity will soon exist at least in the political arena, and that economic recovery and employment gains will take hold. As I have said over the last several years, an economic recovery will ultimately take shape. However, it will be a deliberative and slow process. I’m proud that Mack-Cali has positioned itself well to navigate these waters. Now I’ll talk about our results. FFO for the third quarter of 2010 was $0.69 per diluted share. We had some significant leasing activity in the quarter totaling over 1.1 million square feet of lease transactions. We ended the quarter at 89% leased, up slightly 10 basis points from last quarter’s 88.9%. Our leasing costs were somewhat higher in the third quarter as you’ve seen in the filings, reflecting the quality of transactions we have done and generally with longer leases. I will tell you that generally concessions have stabilized in our markets. For 2010 remaining rollovers are approximately 1.7% of base rent or $10.3 million, and for 2011 we face rollovers of 9.8% of base rent or $60 million. Despite the challenging environment, our portfolio continues to outperform most of the markets in which we operate. With our leased rates exceeding market averages in Northern and Central New Jersey, in Westchester, in Suburban Philadelphia, and in Washington, DC. We are seeing, as indicated by the volume we’ve completed this quarter, some significant leasing activity both in connection with renewals and new tenants.
Our retention rate of 74% reflects the fact that tenants prefer to stay in place, as I have said many times, particularly with a high quality landlord and in high quality assets. However, the decision-making remain slow, in particular, because of the economic uncertainty that exists. Our new tenants generally reflect the flight to quality both in terms of sponsorship and asset quality.Now let’s look at some of the activities in the quarter. On September 30, we announced a new 15 year and two month to be exact 37,500 square foot lease at our 125 Broad Street building in Downtown Manhattan. The lease was with IAVI, the International AIDS Vaccine Initiative, initially fostered by Bill Gates. The full-floor space will serve as the organization’s New York City headquarters. You may have also noticed that just this morning we announced the signing of a new 10-year seven month lease with TMP Worldwide Advertising and Communications, the largest independent firm focused on recruitment advertising and communications. This was again for a full floor of 37,500 square feet at 125 Broad Street, Downtown Manhattan. So these transactions demonstrate that we’re experiencing leasing momentum at this premier property. Today, we have over 2 million square feet of activity for the remainder of this space, and we’re hopeful that we’ll be announcing transactions in the near term. Some notable leasing transactions that we’ve outlined in our quarterly filings include the following In one of the largest transactions done in the State of New Jersey this year, we signed a lease renewal with TD Ameritrade at our Harborside Plaza 4A building in Jersey City. This lease for almost 190,000 square feet secures this location as a TD headquarters location through 2020. The building is 100% leased. Optical Distributor Group, a distributor of soft contact lenses, signed a transaction of almost 41,000 square feet, part renewal part expansion, at our 4 Skyline Drive building in Mid-Westchester Executive Park in Hawthorne, New York. Transactions to leases now run through 2023, and this 81,000 square foot office/flex building is now 100% leased. Read the rest of this transcript for free on seekingalpha.com