Veris Residential Inc. is headquartered in Jersey City
By Joshua Burd
Veris Residential Inc. has agreed to sell a Holmdel office building and a hotel in Jersey City for a combined $132 million, as it continues to shed assets outside the multifamily sector.
The real estate investment trust this week said the Holmdel site, 23 Main St., is the last suburban office property in its portfolio after a nearly decade-long effort to shrink its footprint in the asset class. It’s now under a binding contract to sell the 300,000-square-foot complex, as it is for the 351-room Hyatt Regency Jersey City, although it did not identify the would-be buyers.
The Monmouth County building is listed as fully leased and was the longtime headquarters of Vonage, but the telecommunications company recently moved to sublet the space. Veris expects to close on both deals in the fourth quarter, CEO Mahbod Nia said Thursday, generating a projected $19.6 million of net proceeds for the company.
The announcements came as part of the REIT’s second-quarter earnings call, in which it largely focused on its luxury multifamily portfolio. Based in Jersey City, the former Mack-Cali Realty Corp. has accelerated its pivot from the office sector since it rebranded late last year, fueling continued dispositions alongside moves to grow its apartment holdings.
“Our multifamily portfolio posted another quarter of sector-leading same store rental and (net operating income) growth, reflecting the significant steps we have taken over the past 18 months to reposition the portfolio and enhance our operational platform,” Nia said. He added that the company saw continued leasing velocity at Haus25, its new 750-unit apartment tower in Jersey City, which is now 66 percent leased and nearly 50 percent occupied.
He also noted Thursday that, in Q2, Veris completed the sale of land parcels in Jersey City and the Port Imperial development in northern Hudson County, reaping a combined $100 million. It also closed on its $129.6 million acquisition of The James, a new 240-unit rental property in Park Ridge after the end of the quarter.
“The multifamily portfolio now constitutes 83 percent of the company’s NOI on a pro forma basis, up from 39 percent as of the end of the first quarter of 2021, and approximately 1,900 multifamily units have been added to our portfolio, representing growth of over 30 percent during this time,” Nia added, in prepared remarks.