The lobby inside Mack-Cali Realty Corp.’s flagship Harborside complex in Jersey City — Courtesy: Mack-Cali
By Joshua Burd
Seven of Mack-Cali Realty Corp.’s 11 board members are stepping down, clearing the way for a dissident investor group to take control after a proxy battle that dates back to early last year.
The real estate investment trust announced Thursday night that it has reached an agreement with Bow Street LLC, a hedge fund, to reconstitute its board with nine new directors. Eight of those directors are Bow Street nominees that were to stand for election at Mack-Cali’s annual meeting this week, which the REIT postponed amid ongoing talks with the investor group.
Resigning from the board are longtime Chairman William L. Mack, who was already due to step down in conjunction with the company’s mandatory age policy, along with CEO Michael J. DeMarco, Alan S. Bernikow, Lisa Myers, Laura H. Pomerantz, Irvin D. Reid and Rebecca Robertson. DeMarco remains the company’s CEO.
Mack-Cali’s nine new directors will include Alan R. Batkin, Michael Berman, Frederic Cumenal, MaryAnne Gilmartin, Tammy K. Jones, A. Akiva Katz, Nori Gerardo Lietz, Mahbod Nia and Howard Stern. They will represent a shareholder group that has been calling for changes at the REIT since early last year, seeking to gain control of the board, remove DeMarco as CEO and pursue the sale of the company’s assets.
The group on Thursday struck a more conciliatory tone and did not discuss its immediate plans.
“William Mack, Alan Bernikow and Michael DeMarco have assembled a world-class suite of assets, and I look forward to working collaboratively with management and my fellow elected directors to unlock value for all stakeholders in the years to come,” said Katz, managing partner of Bow Street.
Thursday’s announcement comes a week after Mack-Cali said it was withdrawing three of its incumbent nominees, including DeMarco, in response to shareholder feedback, leaving it with a eight candidates that would go head to head with Bow Street’s slate. But Reuters reported Tuesday night, the day before the annual meeting, that Bow Street was close to gaining control of the REIT’s 11-member board.
Mack-Cali subsequently postponed the meeting and board election amid ongoing talks with Bow Street, which owns 4.5 percent of its outstanding stock and last year successfully gained four board seats. On Thursday night, the Jersey City-based REIT also announced that its annual meeting will now take place on July 1.
The new board will oversee the company pending the meeting, while the company will formally nominate a revised slate of nine candidates based on the reconstituted nominees in order to allow time for it to update and distribute proxy materials to shareholders
“On behalf of Bow Street, I want to thank Mr. Mack for his decades of service to the company, its stakeholders, and the Jersey City community, all of which have benefited from his leadership,” said Howard Shainker, also a managing partner of Bow Street.