10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2010

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number:  333-57103

MACK-CALI REALTY, L.P.

(Exact Name of Registrant as specified in its charter)

Delaware	22-3315804
(State or other jurisdiction of	(IRS Employer
incorporation or organization)	Identification No.)

343 Thornall Street, Edison, New Jersey	08837-2206
(Address of principal executive offices)	(Zip code)

(732) 590-1000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes X No ___

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.  Yes ___ No X

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes X   No ___

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes X   No ___

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendments to this Form 10-K.  [ X ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  x                                                                                                Accelerated filer  ¨

Non-accelerated filer  ¨ (Do not check if a smaller reporting company)                                                                                                                       ;          Smaller reporting company  ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.)  Yes ___ No X

LOCATION OF EXHIBIT INDEX:  The index of exhibits is contained herein on page number 117.

DOCUMENTS INCORPORATED BY REFERENCE:  Portions of Mack-Cali Realty Corporation’s definitive proxy statement for fiscal year ended December 31, 2010 to be issued in conjunction with Mack-Cali Realty Corporation’s annual meeting of shareholders expected to be held on May 24, 2011 are incorporated by reference in Part III of this Form 10-K.  The definitive proxy statement will be filed by Mack-Cali Realty Corporation with the SEC not later than 120 days from the end of Mack-Cali Realty Corporation’s fiscal year ended December 31, 2010.

FORM 10-K

Table of Contents

PART I		Page No.
Item 1	Business	3
Item 1A	Risk Factors	8
Item 1B	Unresolved Staff Comments	17
Item 2	Properties	18
Item 3	Legal Proceedings	38
Item 4	(Removed and Reserved)	38
PART II
Item 5	Market for Registrant’s Common Equity, Related Stockholder Matters
	and Issuer Purchases of Equity Securities	39
Item 6	Selected Financial Data	42
Item 7	Management’s Discussion and Analysis of Financial Condition and
	Results of Operations	43
Item 7A	Quantitative and Qualitative Disclosures About Market Risk	62
Item 8	Financial Statements and Supplementary Data	62
Item 9	Changes in and Disagreements with Accountants on Accounting and
	Financial Disclosure	63
Item 9A	Controls and Procedures	63
Item 9B	Other Information	64
PART III
Item 10	Directors, Executive Officers and Corporate Governance	64
Item 11	Executive Compensation	64
Item 12	Security Ownership of Certain Beneficial Owners and Management
	and Related Stockholder Matters	64
Item 13	Certain Relationships and Related Transactions, and Director Independence	64
Item 14	Principal Accounting Fees and Services	64
PART IV
Item 15	Exhibits and Financial Statement Schedules	65
SIGNATURES		115
EXHIBIT INDEX		117

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PART I

ITEM 1.                 BUSINESS

GENERAL

Mack-Cali Realty L.P., a Delaware limited partnership (together with its subsidiaries, collectively,the “Company”), is a majority-owned subsidiary of Mack-Cali Realty Corporation, a Maryland Corporation and a real estate investment trust (“REIT”) (the “Corporation” or the “General Partner”). The Company owns and operates a real estate portfolio comprised predominantly of Class A office and office/flex properties located primarily in the Northeast.  The Company performs substantially all commercial real estate leasing, management, acquisition, development and construction services on an in-house basis.  The Company was organized on May 24, 1994.  The Company’s executive offices are locate d at 343 Thornall Street, Edison, New Jersey 08837-2206, and its telephone number is (732) 590-1000.  The Corporation has an internet website at www.mack-cali.com.

As of December 31, 2010, the Company owned or had interests in 277 properties, aggregating approximately 32.2 million square feet, plus developable land (collectively, the “Properties”), which are leased to over 2,000 tenants.  The Properties are comprised of: (a) 268 wholly-owned or Company-controlled properties consisting of 162 office buildings and 95 office/flex buildings aggregating approximately 30.6 million square feet, six industrial/warehouse buildings totaling approximately 387,400 square feet, two stand-alone retail properties totaling approximately 17,300 square feet, and three land leases (collectively, the “Consolidated Properties”); and (b) eight buildings, which are primarily office properties, aggregating approximately 1.2 million square feet, and a 350-room hotel, which are owned by u nconsolidated joint ventures in which the Company has investment interests.  Unless otherwise indicated, all references to square feet represent net rentable area.  As of December 31, 2010, the office, office/flex, industrial/warehouse and stand-alone retail properties included in the Consolidated Properties were 89.1 percent leased.  Percentage leased includes all leases in effect as of the period end date, some of which have commencement dates in the future, and leases that expire at the period end date.  Leases that expire as of December 31, 2010 aggregate 187,058 square feet, or 0.6 percent of the net rentable square footage.  The Properties are located in five states, primarily in the Northeast, and the District of Columbia.  See Item 2: Properties.

The Company’s strategy has been to focus its operations, acquisition and development of office properties in high-barrier-to-entry markets and sub-markets where it believes it is, or can become, a significant and preferred owner and operator.  The Company plans to continue this strategy by expanding through acquisitions and/or development in Northeast markets where it has, or can achieve, similar status.  The Company believes that its Properties have excellent locations and access and are well-maintained and professionally managed.  As a result, the Company believes that its Properties attract high quality tenants and achieve among the highest rental, occupancy and tenant retention rates within their markets.  The Company also believes that its extensive market knowledge provides it with a significant competitive advantage, which is further enhanced by its strong reputation for, and emphasis on, delivering highly responsive, professional management services.  See “Business Strategies.”

BUSINESS STRATEGIES

Operations

Reputation:The Company has established a reputation as a highly-regarded landlord with an emphasis on delivering quality tenant services in buildings it owns and/or manages.  The Company believes that its continued success depends in part on enhancing its reputation as an operator of choice, which will facilitate the retention of current tenants and the attraction of new tenants.  The Company believes it provides a superior level of service to its tenants, which should in turn, allow the Company to outperform the market with respect to occupancy rates, as well as improve tenant retention.

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Communication with tenants: The Company emphasizes frequent communication with tenants to ensure first-class service to the Properties.  Property management personnel generally are located on site at the Properties to provide convenient access to management and to ensure that the Properties are well-maintained.  Property management’s primary responsibility is to ensure that buildings are operated at peak efficiency in order to meet both the Company’s and tenants’ needs and expectations.  Property management personnel additionally budget and oversee capital improvements and building system upgrades to enhance the Properties’ competitive advantages in their respective markets and to maintain the quali ty of the Properties.

Additionally, the Corporation’s in-house leasing representatives develop and maintain long-term relationships with the Company’s diverse tenant base and coordinate leasing, expansion, relocation and build-to-suit opportunities within the Company’s portfolio.  This approach allows the Company to offer office space in the appropriate size and location to current or prospective tenants in any of its sub-markets.

Portfolio Management: The Company plans to continue to own and operate a portfolio of properties in high-barrier-to-entry markets, with a primary focus in the Northeast.  The Company’s primary objectives are to maximize operating cash flow and to enhance the value of its portfolio through effective management, acquisition, development and property sales strategies, as follows:

The Company seeks to maximize the value of its existing portfolio through implementing operating strategies designed to produce the highest effective rental and occupancy rates and lowest tenant installation cost within the markets that it operates, and further within the parameters of those markets.  The Company continues to pursue internal growth through leasing vacant space, re-leasing space at higher effective rents with contractual rent increases and developing or redeveloping space for its diverse base of high credit tenants, including Wyndham Worldwide Operations, National Union Fire Insurance and The United States of America - GSA.  In addition, the Company seeks economies of scale through volume discounts to take advantage of its size and dominance in particular sub-markets, and operating efficiencies throu gh the use of in-house management, leasing, marketing, financing, accounting, legal, development and construction services.

Acquisitions: The Company also believes that growth opportunities exist through acquiring operating properties or properties for redevelopment with attractive returns in its core Northeast sub-markets where, based on its expertise in leasing, managing and operating properties, it believes it is, or can become, a significant and preferred owner and operator.  The Company intends either directly or through joint ventures to acquire, invest in or redevelop additional properties that: (i) are expected to provide attractive initial yields with potential for growth in cash flow from operations; (ii) are well-located, of high quality and competitive in their respective sub-markets; (iii) are located in its existing sub-markets or in sub-markets in w hich the Company can become a significant and preferred owner and operator; and (iv) it believes have been under-managed or are otherwise capable of improved performance through intensive management, capital improvements and/or leasing that should result in increased effective rental and occupancy rates.

Development:The Company seeks to selectively develop additional properties either directly or through joint ventures where it believes such development will result in a favorable risk-adjusted return on investment in coordination with the above operating strategies.  Such development primarily will occur: (i) when leases have been executed prior to construction; (ii) in stable core Northeast sub-markets where the demand for such space exceeds available supply; and (iii) where the Company is, or can become, a significant and preferred owner and operator.

Property Sales: While management’s principal intention is to own and operate its properties on a long-term basis, it periodically assesses the attributes of each of its properties, with a particular focus on the supply and demand fundamentals of the sub-markets in which they are located.  Based on these ongoing assessments, the Company may, from time to time, decide to sell any of its properties.

Financial

The Company currently intends to maintain a ratio of debt-to-undepreciated assets (total debt of the Company as a percentage of total undepreciated assets) of 50 percent or less, however there can be no assurance that the Company will be successful in maintaining this ratio.  As of December 31, 2010 and 2009, the Company’s total debt constituted approximately 37.0 percent and 39.8 percent of total undepreciated assets of the Company, respectively.  Although there is no limit in the Company’s organizational documents on the amount of indebtedness that the Company may incur, the Company has entered into certain financial agreements which contain covenants that limit the Company’s ability to incur indebtedness under certain circumstances.  The Company intends to utilize the most appropriate sources of capital for future acquisitions, development, capital improvements and other investments, which may include funds from operating activities, proceeds from property and land sales, short-term and long-term borrowings (including draws on the Company’s revolving credit facility), and the issuance of additional debt securities by the Company or equity securities by the Corporation.

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EMPLOYEES

As of December 31, 2010, the Company had no employees. The Corporation had approximately 390 full-time employees.

COMPETITION

The leasing of real estate is highly competitive.  The Properties compete for tenants with lessors and developers of similar properties located in their respective markets primarily on the basis of location, the quality of properties, leasing terms (including rent and other charges and allowances for tenant improvements), services provided, the design and condition of the Properties, and reputation as an owner and operator of quality office properties in the relevant market. The Company also experiences competition when attempting to acquire or dispose of real estate, including competition from domestic and foreign financial institutions, REITs, life insurance companies, pension trusts, trust funds, partnerships, individual investors and others.

REGULATIONS

Many laws and governmental regulations apply to the ownership and/or operation of the Properties and changes in these laws and regulations, or their interpretation by agencies and the courts, occur frequently.

Under various laws and regulations relating to the protection of the environment, an owner of real estate may be held liable for the costs of removal or remediation of certain hazardous or toxic substances located on or in the property.  These laws often impose liability without regard to whether the owner was responsible for, or even knew of, the presence of such substances.  The presence of such substances may adversely affect the owner’s ability to rent or sell the property or to borrow using such property as collateral and may expose it to liability resulting from any release of, or exposure to, such substances.  Persons who arrange for the disposal or treatment of hazardous or toxic substances at another location may also be liable for the costs of re­moval or remediation of such substances at the disposal or treatment facility, whether or not such facility is owned or operated by such person.  Certain environmental laws impose liability for the release of asbestos-containing materials into the air, and third parties may also seek recovery from owners or operators of real properties for personal injury associated with asbestos-containing materials and other hazardous or toxic substances.

In connection with the ownership (direct or indirect), operation, management and development of real properties, the Company may be considered an owner or operator of such properties or as having arranged for the disposal or treatment of hazardous or toxic substances and, therefore, potentially liable for removal or remediation costs, as well as certain other related costs, including governmental penalties and injuries to persons and property.

There can be no assurance that (i) future laws, ordinances or regulations will not impose any material environmental liability, (ii) the current environmental condition of the Properties will not be affected by tenants, by the condition of land or operations in the vicinity of the Properties (such as the presence of underground storage tanks), or by third parties unrelated to the Company, or (iii) the Company’s assessments reveal all environmental liabilities and that there are no material environmental liabilities of which the Company is aware.  If compliance with the various laws and regulations, now existing or hereafter adopted, exceeds the Company’s budgets for such items, the Company’s ability to make expected distributions to its unitholders or the Corporation’s ability to make expected distribu tions to its stockholders could be adversely affected.

There are no other laws or regulations which have a material effect on the Company’s operations, other than typical federal, state and local laws affecting the development and operation of real property, such as zoning laws.

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INDUSTRY SEGMENTS

The Company operates in two industry segments:  (i) real estate; and (ii) construction services.  As of December 31, 2010, the Company does not have any foreign operations and its business is not seasonal.  Please see our financial statements attached hereto and incorporated by reference herein for financial information relating to our industry segments.

RECENT DEVELOPMENTS

On December 17, 2010, the Company repaid a $26.8 million mortgage loan which encumbered One Grande Commons, a 198,376 square foot unconsolidated joint venture office property located in Bridgewater, New Jersey.  Concurrent with the repayment, the Company placed an $11 million mortgage financing on the property obtained from a bank.  As a result of the repayment of the existing mortgage loan, the Company obtained a controlling interest and is consolidating the office property.  The new mortgage loan bears interest at a rate of LIBOR plus 200 basis points and matures on December 31, 2011, with three one-year extension options, subject to certain conditions and payment of a fee.

The Company’s office property located at 105 Challenger Road in Ridgefield Park, New Jersey, aggregating 150,050 square feet, was collateral for a $19.5 million mortgage loan scheduled to mature on June 6, 2010.  The Company had recorded an impairment charge on the property of $16.6 million at December 31, 2009.   On June 1, 2010, the Company transferred the deed for 105 Challenger to the lender in satisfaction of its obligations.  As a result, the Company recorded a gain on the disposal of the office property of approximately $4.4 million.

The Company’s office property located at 2200 Renaissance Boulevard in King of Prussia, Pennsylvania, aggregating 174,124 square feet, is collateral for a mortgage loan scheduled to mature on December 1, 2012 with a balance of $16.2 million at December 31, 2010.  As of December 31, 2010, the Company estimated that the carrying value of the property may not be recoverable over its anticipated holding period. In order to reduce the carrying value of the property to its estimated fair market value of approximately $13.4 million, the Company recorded an impairment charge of approximately $9.5 million at December 31, 2010.

The Company’s core markets continue to be weak.  The percentage leased in the Company’s consolidated portfolio of stabilized operating properties was 89.1 percent at December 31, 2010, as compared to 90.1 percent at December 31, 2009 and 91.3 percent at December 31, 2008.  Percentage leased includes all leases in effect as of the period end date, some of which have commencement dates in the future and leases that expire at the period end date.  Leases that expired as of December 31, 2010, 2009 and 2008 aggregate 187,058, 64,672 and 67,473 square feet, respectively, or 0.6, 0.2 and 0.2 percentage of the net rentable square footage, respectively.  The Company believes that vacancy rates may continue to increase in some of its markets through 2011 and possibly beyond.  As a res ult, the Company’s future earnings and cash flow may continue to be negatively impacted by current market conditions.

The Company expects that the impact of the current state of the economy, including high unemployment, will continue to have a dampening effect on the fundamentals of its business, including lower occupancy and reduced effective rents.  These conditions would negatively affect the Company’s future net income and cash flows and could have a material adverse effect on the Company’s financial condition.

FINANCING ACTIVITY

On January 15, 2010, the Company refinanced its $150 million secured loan with The Prudential Insurance Company of America.  The new loan also includes VPCM, LLC, a wholly-owned subsidiary of the Virginia Retirement System, as co-lender.  The mortgage loan, which is collateralized by seven properties, is for a seven-year term and carries an interest rate of 6.25 percent.

On December 15, 2010, the Company redeemed $300 million principal amount of its 7.75 percent senior unsecured notes due February 15, 2011.  The redemption price, including a make-whole premium, was 101.225 percent of the principal amount of the notes, plus accrued and unpaid interest up to the redemption date.  The Company funded the redemption price, including accrued and unpaid interest, of approximately $311.4 million from borrowing on its unsecured revolving credit facility, as well as cash on hand.  In connection with the redemption, the Company recorded approximately $3.8 million as a loss from early extinguishment of debt.

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AVAILABLE INFORMATION

The Corporation’s internet website is www.mack-cali.com.  The Company makes available free of charge on or through the Corporation’s website its annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after it electronically files or furnishes such materials to the Securities and Exchange Commission.  In addition, the Corporation’s internet website includes other items related to corporate governance matters, including, among other things, the Corporation’s corporate governance principles, charters of various committees of its Board of Directors, and the Corporation’s code of business conduct a nd ethics applicable to all employees, officers and directors.  The Corporation intends to disclose on its internet website any amendments to or waivers from its code of business conduct and ethics as well as any amendments to its corporate governance principles or the charters of various committees of the Board of Directors.  Copies of these documents may be obtained, free of charge, from the Corporation’s internet website.  Any shareholder also may obtain copies of these documents, free of charge, by sending a request in writing to: Mack-Cali Investor Relations Department, 343 Thornall Street, Edison, NJ  08837-2206.

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

We consider portions of this report, including the documents incorporated by reference, to be forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended.  We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of such act.  Such forward-looking statements relate to, without limitation, our future economic performance, plans and objectives for future operations and projections of revenue and other financial items.  Forward-looking statements can be identified by the use of words such as “may,” “will,” “plan,” “should,” “expect,” “anticipate,” “estimate,” “continue” or comparable terminology.  Forward-looking statements are inherently subject to risks and uncertainties, many of which we cannot predict with accuracy and some of which we might not even anticipate.  Although we believe that the expectations reflected in such forward-looking statements are based upon reasonable assumptions at the time made, we can give no assurance that such expectations will be achieved.  Future events and actual results, financial and otherwise, may differ materially from the results discussed in the forward-looking statements.  Readers are cautioned not to place undue reliance on these forward-looking statements.

Among the factors about which we have made assumptions are:

·   risks and uncertainties affecting the general economic climate and conditions, including the impact of the general economic recession as it impacts the national and local economies, which in turn may have a negative effect on the fundamentals of our business and the financial condition of our tenants;

·   the value of our real estate assets, which may limit our ability to dispose of assets at attractive prices or obtain or maintain debt financing secured by our properties or on an unsecured basis;

·   the extent of any tenant bankruptcies or of any early lease terminations;

·   our ability to lease or re-lease space at current or anticipated rents;

·   changes in the supply of and demand for office, office/flex and industrial/warehouse properties;

·   changes in interest rate levels and volatility in the securities markets;

·   changes in operating costs;

·   our ability to obtain adequate insurance, including coverage for terrorist acts;

·   the availability of financing on attractive terms or at all, which may adversely impact our ability to pursue acquisition and development opportunities and refinance existing debt and our future interest expense;

·   changes in governmental regulation, tax rates and similar matters; and

·   other risks associated with the development and acquisition of properties, including risks that the development may not be completed on schedule, that the tenants will not take occupancy or pay rent, or that development or operating costs may be greater than anticipated.

For further information on factors which could impact us and the statements contained herein, see Item 1A: Risk Factors. We assume no obligation to update and supplement forward-looking statements that become untrue because of subsequent events, new information or otherwise.

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ITEM 1A.        RISK FACTORS

Our results from operations and ability to make distributions to our Partners and debt service on our indebtedness may be affected by the risk factors set forth below.  All investors should consider the following risk factors before deciding to purchase securities of the Company and the Corporation.  The Company refers to itself as “we” or “our” in the following risk factors.

Adverse economic and geopolitical conditions in general and the Northeastern suburban office markets in particular could have a material adverse effect on our results of operations, financial condition and our ability to pay distributions to you.

Our business may be affected by the unprecedented volatility in the financial and credit markets, the general global economic recession, and other market or economic challenges experienced by the U.S. economy or real estate industry as a whole.  Our business may also be adversely affected by local economic conditions, as substantially all of our revenues are derived from our properties located in the Northeast, particularly in New Jersey, New York and Pennsylvania.  Because our portfolio consists primarily of office and office/flex buildings (as compared to a more diversified real estate portfolio) located principally in the Northeast, if economic conditions persist or deteriorate, then our results of operations, financial condition and ability to service current debt and to pay distributions to our Partners may be adversely affected by the following, among other potential conditions:

·   significant job losses in the financial and professional services industries may occur, which may decrease demand for our office space, causing market rental rates and property values to be negatively impacted;

·   our ability to borrow on terms and conditions that we find acceptable, or at all, may be limited, which could reduce our ability to pursue acquisition and development opportunities and refinance existing debt, reduce our returns from both our existing operations and our acquisition and development activities and increase our future interest expense;

·   reduced values of our properties may limit our ability to dispose of assets at attractive prices or to obtain debt financing secured by our properties and may reduce the availability of unsecured loans;

·   the value and liquidity of our short-term investments and cash deposits could be reduced as a result of a deterioration of the financial condition of the institutions that hold our cash deposits or the institutions or assets in which we have made short-term investments, the dislocation of the markets for our short-term investments, increased volatility in market rates for such investments or other factors;

·   reduced liquidity in debt markets and increased credit risk premiums for certain market participants may impair our ability to access capital; and

·   one or more lenders under our line of credit could refuse or be unable to fund their financing commitment to us and we may not be able to replace the financing commitment of any such lenders on favorable terms, or at all.

These conditions, which could have a material adverse effect on our results of operations, financial condition and ability to pay distributions, may continue or worsen in the future.

Our performance is subject to risks associated with the real estate industry.

General: Our business and our ability to make distributions or payments to our investors depend on the ability of our properties to generate funds in excess of operating expenses (including scheduled principal payments on debt and capital expenditures).  Events or conditions that are beyond our control may adversely affect our operations and the value of our Properties.  Such events or conditions could include:

·   changes in the general economic climate and conditions, including the impact of the current global economic recession;

·   changes in local conditions, such as an oversupply of office space, a reduction in demand for office space, or reductions in office market rental rates;

·   decreased attractiveness of our properties to tenants;

·   competition from other office and office/flex properties;

·   our inability to provide adequate maintenance;

·   increased operating costs, including insurance premiums, utilities and real estate taxes, due to inflation and other factors which may not necessarily be offset by increased rents;

·   changes in laws and regulations (including tax, environmental, zoning and building codes, and housing laws and regulations) and agency or court interpretations of such laws and regulations and the related costs of compliance;

·   changes in interest rate levels and the availability of financing;

·   the inability of a significant number of tenants to pay rent;

·   our inability to rent office space on favorable terms; and

·   civil unrest, earthquakes, acts of terrorism and other natural disasters or acts of God that may result in uninsured losses.

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We may suffer adverse consequences if our revenues decline since our operating costs do not necessarily decline in proportion to our revenue:  We earn a significant portion of our income from renting our properties. Our operating costs, however, do not necessarily fluctuate in relation to changes in our rental revenue.  This means that our costs will not necessarily decline even if our revenues do.  Our operating costs could also increase while our revenues do not.  If our operating costs increase but our rental revenues do not, we may be forced to borrow to cover our costs, we may incur losses and we may not have cash available for distributions to our partners.

Financially distressed tenants may be unable to pay rent: If a tenant defaults, we may experience delays and incur substantial costs in enforcing our rights as landlord and protecting our investments.  If a tenant files for bankruptcy, a potential court judgment rejecting and terminating such tenant’s lease could adversely affect our ability to make distributions or payments to our investors as we may be unable to replace the defaulting tenant with a new tenant at a comparable rental rate without incurring significant expenses or a reduction in rental income.

Renewing leases or re-letting space could be costly: If a tenant does not renew its lease upon expiration or terminates its lease early, we may not be able to re-lease the space on favorable terms or at all.  If a tenant does renew its lease or we re-lease the space, the terms of the renewal or new lease, including the cost of required renovations or concessions to the tenant, may be less favorable than the current lease terms, which could adversely affect our ability to make distributions or payments to our investors.

Adverse developments concerning some of our major tenants and industry concentrations could have a negative impact on our revenue: Recent developments in the general economy and the global credit markets have had a significant adverse effect on many companies in numerous industries.  We have tenants concentrated in various industries that may be experiencing adverse effects of current economic conditions.  Our business could be adversely affected if any of these tenants or any other tenants became insolvent, declared bankruptcy or otherwise refused to pay rent in a timely manner or at all.

Our insurance coverage on our properties may be inadequate or our insurance providers may default on their obligations to pay claims:We currently carry comprehensive insurance on all of our properties, including insurance for liability, fire and flood.  We cannot guarantee that the limits of our current policies will be sufficient in the event of a catastrophe to our properties.  We cannot guarantee that we will be able to renew or duplicate our current insurance coverage in adequate amounts or at reasonable prices.  In addition, while our current insurance policies insure us against loss from terrorist acts and toxic mold, in the future, insurance companies ma y no longer offer coverage against these types of losses, or, if offered, these types of insurance may be prohibitively expensive.  If any or all of the foregoing should occur, we may not have insurance coverage against certain types of losses and/or there may be decreases in the limits of insurance available.  Should an uninsured loss or a loss in excess of our insured limits occur, we could lose all or a portion of the capital we have invested in a property or properties, as well as the anticipated future revenue from the property or properties.  Nevertheless, we might remain obligated for any mortgage debt or other financial obligations related to the property or properties.  We cannot guarantee that material losses in excess of insurance proceeds will not occur in the future.  If any of our properties were to experience a catastrophic loss, it could seriously disrupt our operations, delay revenue and result in large expenses to repair or rebuild the prope rty.  Such events could adversely affect our ability to make distributions or payments to our investors.  If one or more of our insurance providers were to fail to pay a claim as a result of insolvency, bankruptcy or otherwise, the nonpayment of such claims could have an adverse effect on our financial condition and results of operations.  In addition, if one or more of our insurance providers were to become subject to insolvency, bankruptcy or other proceedings and our insurance policies with the provider were terminated or canceled as a result of those proceedings, we cannot guarantee that we would be able to find alternative coverage in adequate amounts or at reasonable prices.  In such case, we could experience a lapse in any or adequate insurance coverage with respect to one or more properties and be exposed to potential losses relating to any claims that may arise during such period of lapsed or inadequate coverage.

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Illiquidity of real estate limits our ability to act quickly: Real estate investments are relatively illiquid.  Such illiquidity may limit our ability to react quickly in response to changes in economic and other conditions.  If we want to sell an investment, we might not be able to dispose of that investment in the time period we desire, and the sales price of that investment might not recoup or exceed the amount of our investment.  The prohibition in the Internal Revenue Code of 1986, as amended (the “Code”), and related regulations on a real estate investment trust holding property for sale also may restrict our ability to sell property.  In addition, we acquired a significant number of our propert ies from individuals to whom we issued Units as part of the purchase price.  In connection with the acquisition of these properties, in order to preserve such individual’s income tax deferral, we contractually agreed not to sell or otherwise transfer the properties for a specified period of time, except in a manner which does not result in recognition of any built-in-gain (which may result in an income tax liability) or which reimburses the appropriate individuals for the income tax consequences of the recognition of such built-in-gains.  As of December 31, 2010, seven of our properties, with an aggregate net book value of approximately $133.9 million, were subject to these restrictions, which expire periodically through 2016.  For those properties where such restrictions have lapsed, we are generally required to use commercially reasonable efforts to prevent any sale, transfer or other disposition of the subject properties from resulting in the recognition of built-in gai n to the appropriate individuals.  130 of our properties, with an aggregate net book value of approximately $1.8 billion, have lapsed restrictions and are subject to these conditions.  The above limitations on our ability to sell our investments could adversely affect our ability to make distributions or payments to our investors.

Americans with Disabilities Act compliance could be costly: Under the Americans with Disabilities Act of 1990 (“ADA”), all public accommodations and commercial facilities must meet certain federal requirements related to access and use by disabled persons.  Compliance with the ADA requirements could involve removal of structural barriers from certain disabled persons’ entrances.  Other federal, state and local laws may require modifications to or restrict further renovations of our properties with respect to such accesses.  Although we believe that our properties are substantially in compliance with present requirements, noncompliance with the ADA or related laws or regulations could result in the United States government imposing fines or private litigants being awarded damages against us.  Such costs may adversely affect our ability to make distributions or payments to our investors.

Environmental problems are possible and may be costly: Various federal, state and local laws and regulations subject property owners or operators to liability for the costs of removal or remediation of certain hazardous or toxic substances located on or in the property.  These laws often impose liability without regard to whether the owner or operator was responsible for or even knew of the presence of such substances.  The presence of or failure to properly remediate hazardous or toxic substances (such as toxic mold) may adversely affect our ability to rent, sell or borrow against contaminated property and may impose liability upon us for personal injury to persons exposed to such substances.  Various laws and regulations also impose liability on persons who arrange for the disposal or treatment of hazardous or toxic substances at another location for the costs of removal or remediation of such substances at the disposal or treatment facility.  These laws often impose liability whether or not the person arranging for such disposal ever owned or operated the disposal facility.  Certain other environmental laws and regulations impose liability on owners or operators of property for injuries relating to the release of asbestos-containing or other materials into the air, water or otherwise into the environment.  As owners and operators of property and as potential arrangers for hazardous substance disposal, we may be liable under such laws and regulations for removal or remediation costs, governmental penalties, property damage, personal injuries and related expenses.  Payment of such costs and expenses could adversely affect our ability to make distributions or payments to our investors.< /font>

We face risks associated with property acquisitions: We have acquired in the past, and our long-term strategy is to continue to pursue the acquisition of properties and portfolios of properties in New Jersey, New York and Pennsylvania and in the Northeast generally, including large real estate portfolios that could increase our size and result in alterations to our capital structure.  We may be competing for investment opportunities with entities that have greater financial resources.  Several office building developers and real estate companies may compete with us in seeking properties for acquisition, land for development and prospective tenants. Such competition may adversely affect our ability to make distributions or payments t o our and the Corporation’s investors by:

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·   reducing the number of suitable investment opportunities offered to us;

·   increasing the bargaining power of property owners;

·   interfering with our ability to attract and retain tenants;

·   increasing vacancies which lowers market rental rates and limits our ability to negotiate rental rates; and/or

·   adversely affecting our ability to minimize expenses of operation.

Our acquisition activities and their success are subject to the following risks:

·   adequate financing to complete acquisitions may not be available on favorable terms or at all as a result of the unprecedented volatility in the financial and credit markets;

·   even if we enter into an acquisition agreement for a property, we may be unable to complete that acquisition and risk the loss of certain non-refundable deposits and incurring certain other acquisition-related costs;

·   the actual costs of repositioning or redeveloping acquired properties may be greater than our estimates;

·   any acquisition agreement will likely contain conditions to closing, including completion of due diligence investigations to our satisfaction or other conditions that are not within our control, which may not be satisfied; and

·   we may be unable to quickly and efficiently integrate new acquisitions, particularly acquisitions of portfolios of properties, into our existing operations, and acquired properties may fail to perform as expected; which may adversely affect our results of operations and financial condition.

New acquisitions may fail to perform as expected: We may acquire new office properties, assuming that we are able to obtain capital on favorable terms.  Such newly acquired properties may not perform as expected and may subject us to unknown liability with respect to liabilities relating to such properties for clean-up of undisclosed environmental contamination or claims by tenants, vendors or other persons against the former owners of the properties.  Inaccurate assumptions regarding future rental or occupancy rates could result in overly optimistic estimates of future revenues.  In addition, future operating expenses or the costs necessary to bring an acquired property up to standards established for its intended market position may be underestimated.

Development of real estate could be costly: As part of our operating strategy, we may acquire land for development or construct on owned land, under certain conditions.  Included among the risks of the real estate development business are the following, which may adversely affect our ability to make distributions or payments to our investors:

·   financing for development projects may not be available on favorable terms;

·   long-term financing may not be available upon completion of construction; and

·   failure to complete construction on schedule or within budget may increase debt service expense and construction costs.

Property ownership through joint ventures could subject us to the contrary business objectives of our co-venturers: We, from time to time, invest in joint ventures or partnerships in which we do not hold a controlling interest in the assets underlying the entities in which we invest, including joint ventures in which (i) we own a direct interest in an entity which controls such assets, or (ii) we own a direct interest in an entity which owns indirect interests, through one or more intermediaries, of such assets.  These investments involve risks that do not exist with properties in which we own a controlling interest with respect to the underlying assets, including the possibility that our co-venturers or partners may, at any time, have busine ss, economic or other objectives that are inconsistent with our objectives.  Because we lack a controlling interest, our co-venturers or partners may be in a position to take action contrary to our instructions or requests or contrary to our policies or objectives.  While we seek protective rights against such contrary actions, there can be no assurance that we will be successful in procuring any such protective rights, or if procured, that the rights will be sufficient to fully protect us against contrary actions.  Our organizational documents do not limit the amount of available funds that we may invest in joint ventures or partnerships.  If the objectives of our co-venturers or partners are inconsistent with ours, it may adversely affect our ability to make distributions or payments to our investors.

Our real estate construction management activities are subject to risks particular to third-party construction projects.

As we may perform fixed price construction services for third parties, we are subject to a variety of risks unique to these activities.  If construction costs of a project exceed original estimates, such costs may have to be absorbed by us, thereby making the project less profitable than originally estimated, or possibly not profitable at all.  In addition, a construction project may be delayed due to government or regulatory approvals, supply shortages, or other events and circumstances beyond our control, or the time required to complete a construction project may be greater than originally anticipated.  If any such excess costs or project delays were to be material, such events may adversely effect our cash flow and liquidity and thereby impact our ability to pay dividends or make distributions to our i nvestors.

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We face possible risks associated with the physical effects of climate change.

We cannot predict with certainty whether climate change is occurring and, if so, at what rate.  However, the physical effects of climate change could have a material adverse effect on our properties, operations and business. For example, many of our properties are located along the East coast, particularly those in New Jersey, New York and Connecticut.  To the extent climate change causes changes in weather patterns, our markets could experience increases in storm intensity and rising sea-levels.  Over time, these conditions could result in declining demand for office space in our buildings or the inability of us to operate the buildings at all.  Climate change may also have indirect effects on our business by increasing the cost of (or making unavailable) property insurance on terms we find acce ptable, increasing the cost of energy and increasing the cost of snow removal or related costs at our properties.  Proposed legislation to address climate change could increase utility and other costs of operating our properties which, if not offset by rising rental income, would reduce our net income.  There can be no assurance that climate change will not have a material adverse effect on our properties, operations or business.

Debt financing could adversely affect our economic performance.

Scheduled debt payments and refinancing could adversely affect our financial condition: We are subject to the risks normally associated with debt financing.  These risks, including the following, may adversely affect our ability to make distributions or payments to our investors:

·   our cash flow may be insufficient to meet required payments of principal and interest;

·   payments of principal and interest on borrowings may leave us with insufficient cash resources to pay operating expenses;

·   we may not be able to refinanceindebtedness on our properties at maturity; and

·   if refinanced, the terms of refinancing may not be as favorable as the original terms of the related indebtedness.

As of December 31, 2010, we had total outstanding indebtedness of $2.1 billion comprised of $1.1 billion of senior unsecured notes, outstanding borrowings of $228 million under our $775 million revolving credit facility and approximately $743 million of mortgages, loans payable and other obligations.  We may have to refinance the principal due on our current or future indebtedness at maturity, and we may not be able to do so.

If we are unable to refinance our indebtedness on acceptable terms, or at all, events or conditions that may adversely affect our ability to make distributions or payments to our investors include the following:

·   we may need to dispose of one or more of our properties upon disadvantageous terms;

·   prevailing interest rates or other factors at the time of refinancing could increase interest rates and, therefore, our interest expense;

·   we may be subject to an event of default pursuant to covenants for our indebtedness;

·   if we mortgage property to secure payment of indebtedness and are unable to meet mortgage payments, the mortgagee could foreclose upon such property or appoint a receiver to receive an assignment of our rents and leases; and

·   foreclosures upon mortgaged property could create taxable income without accompanying cash proceeds and, therefore, hinder our ability to meet the real estate investment trust distribution requirements of the Code.

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We are obligated to comply with financial covenants in our indebtedness that could restrict our range of operating activities: The mortgages on our properties contain customary negative covenants, including limitations on our ability, without the prior consent of the lender, to further mortgage the property, to enter into new leases outside of stipulated guidelines or to materially modify existing leases.  In addition, our revolving credit facility contains customary requirements, including restrictions and other limitations on our ability to incur debt, debt to assets ratios, secured debt to total assets ratios, interest coverage ratios and minimum ratios of unencumbered assets to unsecured debt.  The indentures under which our sen ior unsecured debt have been issued contain financial and operating covenants including coverage ratios and limitations on our ability to incur secured and unsecured debt.  These covenants limit our flexibility in conducting our operations and create a risk of default on our indebtedness if we cannot continue to satisfy them.  Some of our debt instruments are cross-collateralized and contain cross default provisions with other debt instruments.  Due to this cross-collateralization, a failure or default with respect to certain debt instruments or properties could have an adverse impact on us or our properties that are subject to the cross-collateralization under the applicable debt instrument.  Failure to comply with these covenants could cause a default under the agreements and, in certain circumstances, our lenders may be entitled to accelerate our debt obligations.  Defaults under our debt agreements could materially and adversely affect our financial condi tion and results of operations.

Rising interest rates may adversely affect our cash flow: As of December 31, 2010, outstanding borrowings of approximately $228 million under our revolving credit facility and approximately $11 million of our mortgage indebtedness bear interest at variable rates.  We may incur additional indebtedness in the future that bears interest at variable rates.  Variable rate debt creates higher debt service requirements if market interest rates increase.  Higher debt service requirements could adversely affect our ability to make distributions or payments to our investors and/or cause us to default under certain debt covenants.

Our degree of leverage could adversely affect our cash flow: We fund acquisition opportunities and development partially through short-term borrowings (including our revolving credit facility), as well as from proceeds from property sales and undistributed cash.  We expect to refinance projects purchased with short-term debt either with long-term indebtedness or equity financing depending upon the economic conditions at the time of refinancing.  The Corporation’s Board of Directors has a general policy of limiting the ratio of our indebtedness to total undepreciated assets (total debt as a percentage of total undepreciated assets) to 50 percent or less, although there is no limit in the Corporation’s or our organizationa l documents on the amount of indebtedness that we may incur.  However, we have entered into certain financial agreements which contain financial and operating covenants that limit our ability under certain circumstances to incur additional secured and unsecured indebtedness.  The Corporation’s Board of Directors could alter or eliminate its current policy on borrowing at any time at its discretion.  If this policy were changed, we could become more highly leveraged, resulting in an increase in debt service that could adversely affect our cash flow and our ability to make distributions or payments to our investors and/or could cause an increased risk of default on our obligations.

We are dependent on external sources of capital for future growth: To qualify as a real estate investment trust under the Code, the Corporation must distribute to its shareholders each year at least 90 percent of its net taxable income, excluding any net capital gain. Because of this distribution requirement, it is not likely that we will be able to fund all future capital needs, including for acquisitions and developments, from income from operations.  Therefore, we will have to rely on third-party sources of capital, which may or may not be available on favorable terms or at all.  Our access to third-party sources of capital depends on a number of things, including the market’s perception of our growth potential and our curr ent and potential future earnings.  Moreover, additional equity offerings may result in substantial dilution of the Corporation’s shareholders’ interests and the interests of our limited partners, and additional debt financing may substantially increase our leverage.

Competition for skilled personnel could increase our labor costs.

We compete with various other companies in attracting and retaining qualified and skilled personnel.  We depend on our ability to attract and retain skilled management personnel who are responsible for the day-to-day operations of our company.  Competitive pressures may require that we enhance our pay and benefits package to compete effectively for such personnel.  We may not be able to offset such added costs by increasing the rates we charge our tenants.  If there is an increase in these costs or if we fail to attract and retain qualified and skilled personnel, our business and operating results could be harmed.

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We are dependent on our key personnel whose continued service is not guaranteed.

We are dependent upon the Corporation’s executive officers for strategic business direction and real estate experience.  While we believe that we could find replacements for these key personnel, loss of their services could adversely affect our operations.  The Corporation has entered into an employment agreement (including non-competition provisions) which provides for a continuous four-year employment term with each of Mitchell E. Hersh, Barry Lefkowitz and Roger W. Thomas and a continuous one-year employment term with Michael A. Grossman.  The Corporation does not have key man life insurance for its executive officers.

Certain provisions of Maryland law and the Corporation’s charter and bylaws could hinder, delay or prevent changes in control.

Certain provisions of Maryland law, and the Corporation’s charter and bylaws have the effect of discouraging, delaying or preventing transactions that involve an actual or threatened change in control.  These provisions include the following:

Classified Board of Directors: The Corporation’s Board of Directors is divided into three classes with staggered terms of office of three years each.  The classification and staggered terms of office of its directors make it more difficult for a third party to gain control of its board of directors.  At least two annual meetings of stockholders, instead of one, generally would be required to affect a change in a majority of the board of directors.

Removal of Directors: Under the Corporation’s charter, subject to the rights of one or more classes or series of preferred stock to elect one or more directors, a director may be removed only for cause and only by the affirmative vote of at least two-thirds of all votes entitled to be cast by the Corporation’s stockholders generally in the election of directors.  Neither the Maryland General Corporation Law nor the Corporation’s charter define the term “cause.”  As a result, removal for “cause” is subject to Maryland common law and to judicial interpretation and review in the context of the facts and circumstances of any particular situation.

Number of Directors, Board Vacancies, Terms of Office: The Corporation has, in its bylaws, elected to be subject to certain provisions of Maryland law which vest in its Board of Directors the exclusive right to determine the number of directors and the exclusive right, by the affirmative vote of a majority of the remaining directors, even if the remaining directors do not constitute a quorum, to fill vacancies on the board.  These provisions of Maryland law, which are applicable even if other provisions of Maryland law or the charter or bylaws provide to the contrary, also provide that any director elected to fill a vacancy shall hold office for the remainder of the full term of the class of directors in which the vacancy occurred, rather tha n the next annual meeting of stockholders as would otherwise be the case, and until his or her successor is elected and qualifies.

Stockholder Requested Special Meetings: The Corporation’s bylaws provide that its stockholders have the right to call a special meeting only upon the written request of the stockholders entitled to cast not less than a majority of all the votes entitled to be cast by the stockholders at such meeting.

Advance Notice Provisions for Stockholder Nominations and Proposals: The Corporation’s bylaws require advance written notice for stockholders to nominate persons for election as directors at, or to bring other business before, any meeting of stockholders.  This bylaw provision limits the ability of stockholders to make nominations of persons for election as directors or to introduce other proposals unless the Corporation is notified in a timely manner prior to the meeting.

Exclusive Authority of the Board to Amend the Bylaws: The Corporation’s bylaws provide that its board of directors has the exclusive power to adopt, alter or repeal any provision of the bylaws or to make new bylaws.  Thus, its stockholders may not effect any changes to its bylaws.

Preferred Stock: Under the Corporation’s charter, its Board of Directors has authority to issue preferred stock from time to time in one or more series and to establish the terms, preferences and rights of any such series of preferred stock, all without approval of its stockholders.

Duties of Directors with Respect to Unsolicited Takeovers: Maryland law provides protection for Maryland corporations against unsolicited takeovers by limiting, among other things, the duties of the directors in unsolicited takeover situations. The duties of directors of Maryland corporations do not require them to (a) accept, recommend or respond to any proposal by a person seeking to acquire control of the corporation, (b) authorize the corporation to redeem any rights under, or modify or render inapplicable, any stockholders rights plan, (c) make a determination under the Maryland Business Combination Act or the Maryland Control Share Acquisition Act, or (d) act or fail to act solely because of the effect of the act or failure to act may have on an acquisition or potential acquisition of control of the corporation or the amount or type of consideration that may be offered or paid to the stockholders in an acquisition.  Moreover, under Maryland law, the act of a director of a Maryland corporation relating to or affecting an acquisition or potential acquisition of control is not subject to any higher duty or greater scrutiny than is applied to any other act of a director. Maryland law also contains a statutory presumption that an act of a director of a Maryland corporation satisfies the applicable standards of conduct for directors under Maryland law.

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Ownership Limit: In order to preserve the Corporation’s status as a real estate investment trust under the Code, its charter generally prohibits any single stockholder, or any group of affiliated stockholders, from beneficially owning more than 9.8 percent of its outstanding capital stock unless its Board of Directors waives or modifies this ownership limit.

Maryland Business Combination Act: The Maryland Business Combination Act provides that unless exempted, a Maryland corporation may not engage in business combinations, including mergers, dispositions of 10 percent or more of its assets, certain issuances of shares of stock and other specified transactions, with an “interested stockholder” or an affiliate of an interested stockholder, for five years after the most recent date on which the interested stockholder became an interested stockholder, and thereafter unless specified criteria are met.  An interested stockholder is generally a person owning or controlling, directly or indirectly, 10 percent or more of the voting power of the outstanding stock of the Maryland corporation.
60; The Corporation’s board of directors has exempted from this statute business combinations between it and certain of its affiliated individuals and entities.  However, unless the Corporation’s board adopts other exemptions, the provisions of the Maryland Business Combination Act will be applicable to business combinations with other persons.

Maryland Control Share Acquisition Act: Maryland law provides that “control shares” of a corporation acquired in a “control share acquisition” shall have no voting rights except to the extent approved by a vote of two-thirds of the votes eligible to cast on the matter under the Maryland Control Share Acquisition Act.  “Control shares” means shares of stock that, if aggregated with all other shares of stock previously acquired by the acquirer, would entitle the acquirer to exercise voting power in electing directors within one of the following ranges of the voting power:  one-tenth or more but less than one-third, one-third or more but less t han a majority or a majority or more of all voting power.  A “control share acquisition” means the acquisition of control shares, subject to certain exceptions.

If voting rights of control shares acquired in a control share acquisition are not approved at a stockholder’s meeting, then subject to certain conditions and limitations, the issuer may redeem any or all of the control shares for fair value.  If voting rights of such control shares are approved at a stockholder’s meeting and the acquirer becomes entitled to vote a majority of the shares of stock entitled to vote, all other stockholders may exercise appraisal rights.  The Corporation’s bylaws contain a provision exempting from the Maryland Control Share Acquisition Act any acquisitions of shares by certain affiliated individuals and entities, any directors, officers or employees of the Corporation and any person approved by the board of directors prior to the acquisition by such person of control s hares.  Any control shares acquired in a control share acquisition which are not exempt under the foregoing provisions of the Corporation’s bylaws will be subject to the Maryland Control Share Acquisition Act.

Consequences of the Corporation’s failure to qualify as a real estate investment trust could adversely affect our financial condition. Failure to maintain ownership limits could cause the Corporation to lose its qualification as a real estate investment trust: In order for the Corporation to maintain its qualification as a real estate investment trust under the Code, not more than 50 percent in value of its outstanding stock may be actually and/or constructively owned by five or fewer individuals (as defined in the Code to include certain entities).  The Corporation has limited the ownership of its outstanding shares of common stock by any single stockholder to 9.8 percent of the o utstanding shares of its common stock.  The Corporation’s Board of Directors could waive this restriction if they were satisfied, based upon the advice of tax counsel or otherwise, that such action would be in its best interests and would not affect its qualification as a real estate investment trust under the Code.  Common stock acquired or transferred in breach of the limitation may be redeemed by the Corporation for the lesser of the price paid and the average closing price for the 10 trading days immediately preceding redemption or sold at the direction of the Corporation.  The Corporation may elect to redeem such shares of common stock for Units, which are nontransferable except in very limited circumstances.  Any transfer of shares of common stock which, as a result of such transfer, causes the Corporation to be in violation of any ownership limit, will be deemed void.  Although the Corporation currently intends to continue to operate in a manner which will enable it to continue to qualify as a real estate investment trust under the Code, it is possible that future economic, market, legal, tax or other considerations may cause the Corporation’s Board of Directors to revoke the election for it to qualify as a real estate investment trust.  Under the Corporation’s organizational documents, its Board of Directors can make such revocation without the consent of its stockholders.

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In addition, the consent of the holders of at least 85 percent of our partnership units is required: (i)  to merge (or permit the merger of) us with another unrelated person, pursuant to a transaction in which we are not the surviving entity; (ii) to dissolve, liquidate or wind up the Company; or (iii) to convey or otherwise transfer all or substantially all of its assets.  As of February 8, 2011, the Corporation, as general partner, owns approximately 86.0 percent of our outstanding common partnership units.

Tax liabilities as a consequence of failure to qualify as a real estate investment trust: The Corporation has elected to be treated and have operated so as to qualify as a real estate investment trust for federal income tax purposes since its taxable year ended December 31, 1994.  Although the Corporation believes it will continue to operate in such manner, it cannot guarantee that it will do so.  Qualification as a real estate investment trust involves the satisfaction of various requirements (some on an annual and some on a quarterly basis) established under highly technical and complex tax provisions of the Code.  Because few judicial or administrative interpretations of such provisions exist and qualification determina tions are fact sensitive, the Corporation cannot assure you that it will qualify as a real estate investment trust for any taxable year.

If the Corporation fails to qualify as a real estate investment trust in any taxable year, it will be subject to the following:

·   it will not be allowed a deduction for dividends paid to shareholders;

·   it will be subject to federal income tax at regular corporate rates, including any alternative minimum tax, if applicable; and

·   unless it is entitled to relief under certain statutory provisions, it will not be permitted to qualify as a real estate investment trust for the four taxable years following the year during which it was disqualified.

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A loss of the Corporation’s status as a real estate investment trust could have an adverse effect on us.  Failure to qualify as a real estate investment trust also would eliminate the requirement that the Corporation pay dividends to its stockholders.

Other tax liabilities: Even if the Corporation qualifies as a real estate investment trust under the Code, it is subject to certain federal, state and local taxes on our income and property and, in some circumstances, certain other state and local taxes.  From time to time changes in state and local tax laws or regulations are enacted, which may result in an increase in our tax liability. A shortfall in tax revenues for states and municipalities in which we operate may lead to an increase in the frequency and size of such changes.  These actions could adversely affect our financial condition and results of operations. In addition, our taxable REIT subsidiaries will be subject to federal, state and local income tax for income receive d in connection with certain non-customary services performed for tenants and/or third parties.

Risk of changes in the tax law applicable to real estate investment trusts: Since the Internal Revenue Service, the United States Treasury Department and Congress frequently review federal income tax legislation, we cannot predict whether, when or to what extent new federal tax laws, regulations, interpretations or rulings will be adopted.  Any of such legislative action may prospectively or retroactively modify our and the Corporation’s tax treatment and, therefore, may adversely affect taxation of us, the Corporation, and/or our investors.

Changes in market conditions could adversely affect the market price of the Corporation’s common stock.

As with other publicly traded equity securities, the value of the Corporation’s common stock depends on various market conditions, which may change from time to time.  The market price of the Corporation’s common stock could change in ways that may or may not be related to our business, our industry or our operating performance and financial condition.  Among the market conditions that may affect the value of the Corporation’s common stock are the following:

· the extent of your interest in us;

· the general reputation of REITs and the attractiveness of the Corporation’s equity securities in comparison to other equity securities, including securities issued by other real estate-based companies;

· our financial performance; and

· general stock and bond market conditions.

The market value of the Corporation’s common stock is based primarily upon the market’s perception of our growth potential and our current and potential future earnings and the Corporation‘s cash dividends. Consequently, the Corporation’s common stock may trade at prices that are higher or lower than its net asset value per share of common stock.

ITEM 1B.              UNRESOLVED STAFF COMMENTS

None.

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ITEM 2.                 PROPERTIES

PROPERTY LIST

As of December 31, 2010, the Company’s Consolidated Properties consisted of 263 in-service office, office/flex and industrial/warehouse properties, as well as two stand-alone retail properties and three land leases.  The Consolidated Properties are located primarily in the Northeast.  The Consolidated Properties are easily accessible from major thoroughfares and are in close proximity to numerous amenities.  The Consolidated Properties contain a total of approximately 31.0 million square feet, with the individual properties ranging from 6,216 to 1,246,283 square feet.  The Consolidated Properties, managed by on-site employees, generally have attractively landscaped sites and atriums in addition to quality design and construction.  The Company’s tenants include many service s ector employers, including a large number of professional firms and national and international businesses.  The Company believes that all of its properties are well-maintained and do not require significant capital improvements.

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Office Properties
							2010
			Percentage	2010		2010	Average
		Net	Leased	Base		Average	Effective
		Rentable	as of	Rent	Percentage	Base Rent	Rent
	Year	Area	12/31/10	($000’s)	of Total 2010	Per Sq. Ft.	Per Sq. Ft.
Property Location	Built	(Sq. Ft.)	(%) (a)	(b) (c)	Base Rent (%)	($) (c) (d)	($) (c) (e)
NEW JERSEY
Bergen County
Fair Lawn
17-17 Route 208 North	1987	143,000	100.0	2,239	0.37	15.66	14.16
Fort Lee
One Bridge Plaza	1981	200,000	83.4	4,270	0.71	25.60	22.03
2115 Linwood Avenue	1981	68,000	55.2	942	0.16	25.10	23.36
Little Ferry
200 Riser Road	1974	286,628	100.0	2,083	0.35	7.27	6.88
Lyndhurst
210 Clay Avenue	1981	121,203	89.1	2,502	0.42	23.17	20.93
Montvale
95 Chestnut Ridge Road	1975	47,700	0.0	4	0.00	0.00	0.00
135 Chestnut Ridge Road	1981	66,150	35.4	1,290	0.21	55.09	47.10
Paramus
15 East Midland Avenue	1988	259,823	80.5	4,860	0.81	23.24	22.48
140 East Ridgewood Avenue	1981	239,680	93.3	4,868	0.81	21.77	18.71
461 From Road	1988	253,554	97.0	6,081	1.01	24.72	24.64
650 From Road	1978	348,510	79.5	6,224	1.03	22.46	19.65
61 South Paramus Road (f)	1985	269,191	70.9	5,232	0.87	27.41	23.96
Rochelle Park
120 West Passaic Street	1972	52,000	99.6	1,403	0.23	27.09	25.62
365 West Passaic Street	1976	212,578	98.7	4,335	0.72	20.66	18.35
395 West Passaic Street	1979	100,589	98.0	2,426	0.40	24.61	20.79
Upper Saddle River
1 Lake Street	1973/94	474,801	100.0	7,465	1.23	15.72	15.72
10 Mountainview Road	1986	192,000	72.9	3,234	0.54	23.11	20.25
Woodcliff Lake
400 Chestnut Ridge Road	1982	89,200	100.0	1,950	0.32	21.86	16.32
470 Chestnut Ridge Road	1987	52,500	100.0	1,248	0.21	23.77	18.90
530 Chestnut Ridge Road	1986	57,204	80.2	759	0.13	16.54	15.00
50 Tice Boulevard	1984	235,000	84.2	5,880	0.98	29.72	26.85
300 Tice Boulevard	1991	230,000	96.0	5,561	0.92	25.19	22.45
Burlington County
Moorestown
224 Strawbridge Drive	1984	74,000	100.0	1,750	0.29	23.65	20.38
228 Strawbridge Drive	1984	74,000	100.0	1,853	0.31	25.04	21.61
232 Strawbridge Drive	1986	74,258	98.8	1,474	0.24	20.09	18.03
Essex County
Millburn
150 J.F. Kennedy Parkway	1980	247,476	98.0	7,263	1.21	29.95	25.19
Roseland
4 Becker Farm Road	1983	281,762	97.1	6,542	1.09	23.91	21.80
5 Becker Farm Road	1982	118,343	89.8	2,501	0.42	23.53	21.43
6 Becker Farm Road	1982	129,732	78.3	2,799	0.46	27.55	25.47
101 Eisenhower Parkway	1980	237,000	91.4	5,163	0.86	23.83	21.79
103 Eisenhower Parkway	1985	151,545	72.7	2,231	0.37	20.25	17.05
105 Eisenhower Parkway	2001	220,000	96.3	5,175	0.86	24.43	18.29
75 Livingston Avenue	1985	94,221	59.4	1,301	0.22	23.25	19.14
85 Livingston Avenue	1985	124,595	84.8	2,713	0.45	25.68	23.77

19

Office Properties
(Continued)
							2010
			Percentage	2010		2010	Average
		Net	Leased	Base		Average	Effective
		Rentable	as of	Rent	Percentage	Base Rent	Rent
	Year	Area	12/31/10	($000’s)	of Total 2010	Per Sq. Ft.	Per Sq. Ft.
Property Location	Built	(Sq. Ft.)	(%) (a)	(b) (c)	Base Rent (%)	($) (c) (d)	($) (c) (e)
Hudson County
Jersey City
Harborside Financial Center Plaza 1	1983	400,000	100.0	11,507	1.91	28.77	25.31
Harborside Financial Center Plaza 2	1990	761,200	100.0	18,556	3.08	24.38	22.43
Harborside Financial Center Plaza 3	1990	725,600	95.6	20,044	3.33	28.90	26.86
Harborside Financial Center Plaza 4-A	2000	207,670	100.0	6,081	1.01	29.28	25.09
Harborside Financial Center Plaza 5	2002	977,225	96.1	36,248	6.01	38.60	33.16
101 Hudson Street	1992	1,246,283	93.8	30,173	5.01	25.81	22.49
Mercer County
Hamilton Township
3 AAA Drive	1981	35,270	68.7	566	0.09	23.36	18.53
600 Horizon Drive	2002	95,000	100.0	1,384	0.23	14.57	14.57
700 Horizon Drive	2007	120,000	100.0	2,459	0.41	20.49	18.33
2 South Gold Drive	1974	33,962	64.5	483	0.08	22.05	19.49
Princeton
103 Carnegie Center	1984	96,000	90.7	2,480	0.41	28.48	23.84
2 Independence Way	1981	67,401	100.0	1,521	0.25	22.57	20.53
3 Independence Way	1983	111,300	96.0	2,065	0.34	19.33	14.74
100 Overlook Center	1988	149,600	90.9	4,608	0.76	33.89	28.90
5 Vaughn Drive	1987	98,500	83.8	2,146	0.36	26.00	21.89
Middlesex County
East Brunswick
377 Summerhill Road	1977	40,000	100.0	362	0.06	9.05	8.35
Edison
343 Thornall Street (c)	1991	195,709	100.0	4,170	0.69	21.31	16.18
Piscataway
30 Knightsbridge Road, Bldg 3	1977	160,000	100.0	2,334	0.39	14.59	14.59
30 Knightsbridge Road, Bldg 4	1977	115,000	100.0	1,677	0.28	14.58	14.58
30 Knightsbridge Road, Bldg 5	1977	332,607	80.8	4,942	0.82	18.39	13.42
30 Knightsbridge Road, Bldg 6	1977	72,743	63.8	206	0.03	4.44	2.09
Plainsboro
500 College Road East (f)	1984	158,235	71.9	418	0.07	3.67	2.66
Woodbridge
581 Main Street	1991	200,000	93.1	4,989	0.83	26.79	23.25
Monmouth County
Freehold
2 Paragon Way	1989	44,524	44.3	393	0.07	19.92	17.39
3 Paragon Way	1991	66,898	64.3	802	0.13	18.64	13.74
4 Paragon Way	2002	63,989	30.8	521	0.09	26.44	24.61
100 Willbowbrook Road	1988	60,557	64.2	1,257	0.21	32.33	22.76
Holmdel
23 Main Street	1977	350,000	100.0	4,012	0.67	11.46	8.63
Middletown
One River Center Bldg 1	1983	122,594	91.1	2,981	0.49	26.69	21.95
One River Center Bldg 2	1983	120,360	82.8	2,456	0.41	24.64	22.79
One River Center Bldg 3 and 4	1984	214,518	88.4	4,328	0.72	22.82	21.97
Neptune
3600 Route 66	1989	180,000	100.0	2,400	0.40	13.33	12.06
Wall Township
1305 Campus Parkway	1988	23,350	92.4	474	0.08	21.97	14.55
1350 Campus Parkway	1990	79,747	99.9	1,309	0.22	16.43	14.23

20

Office Properties
(Continued)
								2010
				Percentage	2010		2010	Average
			Net	Leased	Base		Average	Effective
			Rentable	as of	Rent	Percentage	Base Rent	Rent
		Year	Area	12/31/10	($000’s)	of Total 2010	Per Sq. Ft.	Per Sq. Ft.
Property Location		Built	(Sq. Ft.)	(%) (a)	(b) (c)	Base Rent (%)	($) (c) (d)	($) (c) (e)
Morris County
Florham Park
325 Columbia Turnpike		1987	168,144	78.5	3,007	0.50	22.78	19.36
Morris Plains
250 Johnson Road		1977	75,000	100.0	1,579	0.26	21.05	18.47
201 Littleton Road		1979	88,369	36.4	1,150	0.19	35.75	33.11
Morris Township
412 Mt. Kemble Avenue		1986	475,100	58.6	5,005	0.83	17.98	13.46
Parsippany
4 Campus Drive		1983	147,475	87.5	3,134	0.52	24.29	19.47
6 Campus Drive		1983	148,291	94.4	3,279	0.54	23.42	19.28
7 Campus Drive		1982	154,395	77.4	1,806	0.30	15.11	12.42
8 Campus Drive		1987	215,265	100.0	6,080	1.01	28.24	25.14
9 Campus Drive		1983	156,495	67.6	2,496	0.41	23.59	21.76
4 Century Drive		1981	100,036	72.3	1,491	0.25	20.61	17.37
5 Century Drive		1981	79,739	77.1	1,352	0.22	21.99	18.59
6 Century Drive		1981	100,036	94.7	1,617	0.27	17.07	8.47
2 Dryden Way		1990	6,216	100.0	99	0.02	15.93	14.64
4 Gatehall Drive		1988	248,480	99.4	6,370	1.06	25.79	22.62
2 Hilton Court		1991	181,592	100.0	6,528	1.08	35.95	31.33
1633 Littleton Road		1978	57,722	100.0	1,131	0.19	19.59	19.59
600 Parsippany Road		1978	96,000	84.4	1,490	0.25	18.39	14.18
1 Sylvan Way		1989	150,557	60.3	1,841	0.31	20.28	16.81
4 Sylvan Way		1984	105,135	100.0	1,929	0.32	18.35	16.47
5 Sylvan Way		1989	151,383	93.5	3,436	0.57	24.28	20.84
7 Sylvan Way		1987	145,983	100.0	3,219	0.53	22.05	19.29
22 Sylvan Way		2009	249,409	100.0	6,027	1.00	24.17	21.78
20 Waterview Boulevard		1988	225,550	100.0	5,313	0.88	23.56	20.02
35 Waterview Boulevard		1990	172,498	96.8	3,586	0.60	21.48	18.63
5 Wood Hollow Road		1979	317,040	84.5	4,769	0.79	17.80	14.35
Passaic County
Clifton
777 Passaic Avenue		1983	75,000	66.0	1,350	0.22	27.27	25.39
Totowa
999 Riverview Drive		1988	56,066	89.7	861	0.14	17.12	15.07
Somerset County
Basking Ridge
222 Mt. Airy Road		1986	49,000	100.0	1,059	0.18	21.61	16.20
233 Mt. Airy Road		1987	66,000	100.0	1,315	0.22	19.92	16.71
Bernards
106 Allen Road		2000	132,010	99.7	3,289	0.55	24.99	19.49
Branchburg
51 Imclone Drive		1986	63,213	100.0	344	0.06	5.44	4.62
Bridgewater
440 Route 22 East (g)	1990		198,376	82.5	0	0.00	0.00	0.00
721 Route 202/206	1989		192,741	86.4	3,640	0.60	21.86	15.76
Warren
10 Independence Boulevard	1988		120,528	100.0	3,330	0.55	27.63	25.38
Union County
Clark
100 Walnut Avenue	1985		182,555	94.1	4,755	0.79	27.68	23.27

21

Office Properties
(Continued)
								2010
				Percentage	2010		2010	Average
			Net	Leased	Base		Average	Effective
			Rentable	as of	Rent	Percentage	Base Rent	Rent
	Year		Area	12/31/10	($000’s)	of Total 2010	Per Sq. Ft.	Per Sq. Ft.
Property Location	Built		(Sq. Ft.)	(%) (a)	(b) (c)	Base Rent (%)	($) (c) (d)	($) (c) (e)
Cranford
6 Commerce Drive	1973		56,000	88.5	990	0.16	19.98	17.01
11 Commerce Drive	1981		90,000	100.0	2,039	0.34	22.66	19.10
12 Commerce Drive	1967		72,260	83.9	850	0.14	14.02	10.69
14 Commerce Drive	1971		67,189	71.3	1,118	0.19	23.34	18.81
20 Commerce Drive	1990		176,600	99.8	4,399	0.73	24.96	21.71
25 Commerce Drive	1971		67,749	95.8	1,446	0.24	22.28	20.32
65 Jackson Drive	1984		82,778	100.0	1,879	0.31	22.70	19.73
New Providence
890 Mountain Avenue	1977		80,000	91.4	1,780	0.30	24.34	22.89
Total New Jersey Office			19,396,060	89.9	408,151	67.77	23.42	20.40
NEW YORK
New York County
New York
125 Broad Street	1970		524,476	58.6	9,036	1.50	29.40	27.51
Rockland County
Suffern
400 Rella Boulevard	1988		180,000	87.1	3,712	0.62	23.68	21.03
Westchester County
Elmsford
100 Clearbrook Road (c)	1975		60,000	98.0	1,118	0.19	19.01	17.31
101 Executive Boulevard	1971		50,000	12.6	361	0.06	57.30	51.27
555 Taxter Road	1986		170,554	80.3	3,468	0.58	25.32	20.47
565 Taxter Road	1988		170,554	90.2	3,977	0.66	25.85	21.42
570 Taxter Road	1972		75,000	73.6	1,292	0.21	23.41	21.56
Hawthorne
1 Skyline Drive	1980		20,400	99.0	356	0.06	17.63	16.59
2 Skyline Drive	1987		30,000	100.0	286	0.05	9.53	7.23
7 Skyline Drive	1987		109,000	83.2	2,730	0.45	30.10	26.61
17 Skyline Drive (f)	1989		85,000	100.0	1,630	0.27	19.18	18.53
19 Skyline Drive	1982		248,400	100.0	4,036	0.67	16.25	15.11
Tarrytown
200 White Plains Road	1982		89,000	92.6	1,731	0.29	21.00	18.52
220 White Plains Road	1984		89,000	76.8	1,634	0.27	23.91	20.91
White Plains
1 Barker Avenue		1975	68,000	95.0	1,660	0.28	25.70	23.54
3 Barker Avenue		1983	65,300	100.0	1,712	0.28	26.22	23.84
50 Main Street		1985	309,000	94.3	9,469	1.56	32.50	29.36
11 Martine Avenue		1987	180,000	89.2	4,621	0.77	28.78	26.20
1 Water Street		1979	45,700	100.0	1,140	0.19	24.95	21.51
Yonkers
1 Executive Boulevard		1982	112,000	100.0	2,774	0.46	24.77	21.57
3 Executive Boulevard		1987	58,000	94.8	1,598	0.27	29.06	28.03
Total New York Office			2,739,384	83.8	58,341	9.69	25.42	22.84

22

Office Properties
(Continued)
							2010
			Percentage	2010		2010	Average
		Net	Leased	Base		Average	Effective
		Rentable	as of	Rent	Percentage	Base Rent	Rent
	Year	Area	12/31/10	($000’s)	of Total 2010	Per Sq. Ft.	Per Sq. Ft.
Property Location	Built	(Sq. Ft.)	(%) (a)	(b) (c)	Base Rent (%)	($) (c) (d)	($) (c) (e)
PENNSYLVANIA
Chester County
Berwyn
1000 Westlakes Drive	1989	60,696	92.2	1,522	0.25	27.20	26.20
1055 Westlakes Drive	1990	118,487	88.1	2,877	0.48	27.56	23.08
1205 Westlakes Drive	1988	130,265	87.6	3,149	0.52	27.60	24.19
1235 Westlakes Drive	1986	134,902	99.0	2,975	0.49	22.28	18.39
Delaware County
Lester
100 Stevens Drive	1986	95,000	100.0	2,771	0.46	29.17	26.55
200 Stevens Drive	1987	208,000	100.0	6,088	1.01	29.27	27.14
300 Stevens Drive	1992	68,000	90.7	1,398	0.23	22.67	18.69
Media
1400 Providence Road – Center I	1986	100,000	98.7	2,183	0.36	22.12	19.36
1400 Providence Road – Center II	1990	160,000	100.0	3,612	0.60	22.58	19.01
Montgomery County
Bala Cynwyd
150 Monument Road	1981	125,783	95.5	2,908	0.48	24.21	20.85
Blue Bell
4 Sentry Park	1982	63,930	78.8	1,036	0.17	20.57	17.35
5 Sentry Park East	1984	91,600	58.5	1,108	0.18	20.68	14.67
5 Sentry Park West	1984	38,400	31.5	253	0.04	20.92	18.44
16 Sentry Park West	1988	93,093	100.0	1,987	0.33	21.34	18.58
18 Sentry Park West	1988	95,010	99.8	2,182	0.36	23.01	20.18
King of Prussia
2200 Renaissance Boulevard	1985	174,124	57.9	2,304	0.38	22.85	18.24
Lower Providence
1000 Madison Avenue	1990	100,700	75.0	985	0.16	13.04	8.29
Plymouth Meeting
1150 Plymouth Meeting Mall	1970	167,748	69.1	2,641	0.44	22.78	17.61
Total Pennsylvania Office		2,025,738	86.3	41,979	6.94	24.02	20.54
CONNECTICUT
Fairfield County
Norwalk
40 Richards Avenue	1985	145,487	69.5	2,340	0.39	23.14	19.69
Stamford
1266 East Main Street	1984	179,260	88.8	4,058	0.66	25.49	21.72
Total Connecticut Office		324,747	80.1	6,398	1.05	24.61	20.96
DISTRICT OF COLUMBIA
Washington
1201 Connecticut Avenue, NW	1940	169,549	92.9	6,796	1.12	43.15	37.73
1400 L Street, NW	1987	159,000	100.0	5,818	0.97	36.59	30.89
Total District of Columbia Office		328,549	96.3	12,614	2.09	39.85	34.29

23

Office Properties
(Continued)
							2010
			Percentage	2010		2010	Average
		Net	Leased	Base		Average	Effective
		Rentable	as of	Rent	Percentage	Base Rent	Rent
	Year	Area	12/31/10	($000’s)	of Total 2010	Per Sq. Ft.	Per Sq. Ft.
Property Location	Built	(Sq. Ft.)	(%) (a)	(b) (c)	Base Rent (%)	($) (c) (d)	($) (c) (e)
MARYLAND
Prince George’s County
Greenbelt
9200 Edmonston Road	1973	38,690	100.0	910	0.15	23.52	21.17
6301 Ivy Lane	1979	112,003	78.3	1,741	0.29	19.85	17.77
6303 Ivy Lane	1980	112,047	85.6	2,029	0.34	21.15	19.41
6305 Ivy Lane	1982	112,022	68.5	1,666	0.28	21.71	19.18
6404 Ivy Lane	1987	165,234	66.3	1,674	0.28	15.28	11.44
6406 Ivy Lane	1991	163,857	0.0	0	0.00	0.00	0.00
6411 Ivy Lane	1984	138,405	90.2	2,882	0.48	23.09	20.23
Lanham
4200 Parliament Place	1989	122,000	93.7	2,754	0.46	24.09	22.29
Total Maryland Office		964,258	67.2	13,656	2.28	21.08	18.58
TOTAL OFFICE PROPERTIES		25,778,736	88.0	541,139	89.82	23.84	20.81

24

Office/Flex Properties
							2010
			Percentage	2010		2010	Average
		Net	Leased	Base		Average	Effective
		Rentable	as of	Rent	Percentage	Base Rent	Rent
	Year	Area	12/31/10	($000’s)	of Total 2010	Per Sq. Ft.	Per Sq. Ft.
Property Location	Built	(Sq. Ft.)	(%) (a)	(b) (c)	Base Rent (%)	($) (c) (d)	($) (c) (e)
NEW JERSEY
Burlington County
Burlington
3 Terri Lane	1991	64,500	100.0	561	0.09	8.70	7.69
5 Terri Lane	1992	74,555	100.0	526	0.09	7.06	5.70
Moorestown
2 Commerce Drive	1986	49,000	85.4	274	0.05	6.55	4.49
101 Commerce Drive	1988	64,700	100.0	275	0.05	4.25	3.85
102 Commerce Drive	1987	38,400	87.5	215	0.04	6.40	4.61
201 Commerce Drive	1986	38,400	100.0	199	0.03	5.18	3.93
202 Commerce Drive	1988	51,200	82.8	212	0.04	5.00	4.15
1 Executive Drive	1989	20,570	81.1	162	0.03	9.71	7.67
2 Executive Drive	1988	60,800	90.3	442	0.07	8.05	5.72
101 Executive Drive	1990	29,355	99.7	306	0.05	10.46	8.06
102 Executive Drive	1990	64,000	100.0	474	0.08	7.41	7.02
225 Executive Drive	1990	50,600	79.1	175	0.03	4.37	3.02
97 Foster Road	1982	43,200	74.8	152	0.03	4.70	3.22
1507 Lancer Drive	1995	32,700	100.0	134	0.02	4.10	3.79
1245 North Church Street	1998	52,810	100.0	296	0.05	5.60	4.92
1247 North Church Street	1998	52,790	58.1	200	0.03	6.52	5.35
1256 North Church Street	1984	63,495	100.0	431	0.07	6.79	6.11
840 North Lenola Road	1995	38,300	100.0	370	0.06	9.66	7.86
844 North Lenola Road	1995	28,670	100.0	183	0.03	6.38	4.81
915 North Lenola Road	1998	52,488	100.0	297	0.05	5.66	4.48
2 Twosome Drive	2000	48,600	100.0	450	0.07	9.26	8.81
30 Twosome Drive	1997	39,675	100.0	283	0.05	7.13	5.44
31 Twosome Drive	1998	84,200	100.0	483	0.08	5.74	5.44
40 Twosome Drive	1996	40,265	100.0	305	0.05	7.57	6.41
41 Twosome Drive	1998	43,050	77.7	201	0.03	6.01	5.05
50 Twosome Drive	1997	34,075	100.0	257	0.04	7.54	7.13
Gloucester County
West Deptford
1451 Metropolitan Drive	1996	21,600	100.0	120	0.02	5.56	4.91
Mercer County
Hamilton Township
100 Horizon Center Boulevard	1989	13,275	50.0	189	0.03	28.47	24.41
200 Horizon Drive	1991	45,770	100.0	601	0.10	13.13	11.89
300 Horizon Drive	1989	69,780	55.3	827	0.14	21.43	15.73
500 Horizon Drive	1990	41,205	88.7	509	0.08	13.93	13.02
Monmouth County
Wall Township
1325 Campus Parkway	1988	35,000	100.0	653	0.11	18.66	14.63
1340 Campus Parkway	1992	72,502	100.0	888	0.15	12.25	9.85
1345 Campus Parkway	1995	76,300	85.4	874	0.15	13.41	10.39
1433 Highway 34	1985	69,020	70.2	554	0.09	11.43	8.59
1320 Wyckoff Avenue	1986	20,336	100.0	222	0.04	10.92	9.15
1324 Wyckoff Avenue	1987	21,168	81.5	186	0.03	10.78	6.84

25

Office/Flex Properties
(Continued)
							2010
			Percentage	2010		2010	Average
		Net	Leased	Base		Average	Effective
		Rentable	as of	Rent	Percentage	Base Rent	Rent
	Year	Area	12/31/10	($000’s)	of Total 2010	Per Sq. Ft.	Per Sq. Ft.
Property Location	Built	(Sq. Ft.)	(%) (a)	(b) (c)	Base Rent (%)	($) (c) (d)	($) (c) (e)
Passaic County
Totowa
1 Center Court	1999	38,961	46.2	300	0.05	16.67	15.50
2 Center Court	1998	30,600	62.8	326	0.05	16.96	14.73
11 Commerce Way	1989	47,025	100.0	610	0.10	12.97	12.59
20 Commerce Way	1992	42,540	70.8	320	0.05	10.62	10.49
29 Commerce Way	1990	48,930	100.0	699	0.12	14.29	11.38
40 Commerce Way	1987	50,576	72.5	329	0.05	8.97	8.26
45 Commerce Way	1992	51,207	100.0	480	0.08	9.37	7.77
60 Commerce Way	1988	50,333	100.0	590	0.10	11.72	9.58
80 Commerce Way	1996	22,500	100.0	266	0.04	11.82	10.58
100 Commerce Way	1996	24,600	66.9	290	0.05	17.62	15.68
120 Commerce Way	1994	9,024	100.0	117	0.02	12.97	12.19
140 Commerce Way	1994	26,881	99.5	350	0.06	13.09	12.23
Total New Jersey Office/Flex		2,189,531	89.5	18,163	3.02	9.26	7.77
NEW YORK
Westchester County
Elmsford
11 Clearbrook Road	1974	31,800	72.8	366	0.06	15.81	13.61
75 Clearbrook Road	1990	32,720	100.0	464	0.08	14.18	13.08
125 Clearbrook Road	2002	33,000	100.0	712	0.12	21.58	17.94
150 Clearbrook Road	1975	74,900	100.0	983	0.16	13.12	11.96
175 Clearbrook Road	1973	98,900	98.6	1,429	0.24	14.65	13.34
200 Clearbrook Road	1974	94,000	98.8	1,119	0.19	12.05	10.48
250 Clearbrook Road	1973	155,000	97.3	1,541	0.26	10.22	9.29
50 Executive Boulevard	1969	45,200	95.2	467	0.08	10.85	9.37
77 Executive Boulevard	1977	13,000	100.0	248	0.04	19.08	18.31
85 Executive Boulevard	1968	31,000	99.4	577	0.10	18.73	15.87
300 Executive Boulevard	1970	60,000	100.0	551	0.09	9.18	8.05
350 Executive Boulevard	1970	15,400	98.8	233	0.04	15.31	15.12
399 Executive Boulevard	1962	80,000	100.0	1,038	0.17	12.98	12.40
400 Executive Boulevard	1970	42,200	55.2	487	0.08	20.91	17.13
500 Executive Boulevard	1970	41,600	100.0	735	0.12	17.67	15.38
525 Executive Boulevard	1972	61,700	100.0	1,071	0.18	17.36	15.75
1 Westchester Plaza	1967	25,000	100.0	316	0.05	12.64	12.28
2 Westchester Plaza	1968	25,000	100.0	542	0.09	21.68	20.12
3 Westchester Plaza	1969	93,500	99.4	1,045	0.17	11.24	9.46
4 Westchester Plaza	1969	44,700	100.0	540	0.09	12.08	9.91
5 Westchester Plaza	1969	20,000	100.0	296	0.05	14.80	9.80
6 Westchester Plaza	1968	20,000	100.0	312	0.05	15.60	14.25
7 Westchester Plaza	1972	46,200	100.0	628	0.10	13.59	13.27
8 Westchester Plaza	1971	67,200	100.0	1,027	0.17	15.28	13.15
Hawthorne
200 Saw Mill River Road	1965	51,100	87.9	594	0.10	13.22	12.27
4 Skyline Drive	1987	80,600	100.0	1,254	0.21	15.56	13.23
5 Skyline Drive	1980	124,022	99.3	1,626	0.27	13.20	11.37
6 Skyline Drive	1980	44,155	100.0	149	0.02	3.37	2.88
8 Skyline Drive	1985	50,000	92.7	928	0.15	20.02	16.25
10 Skyline Drive	1985	20,000	100.0	351	0.06	17.55	14.75
11 Skyline Drive (f)	1989	45,000	100.0	848	0.14	18.84	18.56
12 Skyline Drive (f)	1999	46,850	100.0	606	0.10	12.93	10.22
15 Skyline Drive (f)	1989	55,000	100.0	1,202	0.20	21.85	20.00

26

Office/Flex Properties
(Continued)
							2010
			Percentage	2010		2010	Average
		Net	Leased	Base		Average	Effective
		Rentable	as of	Rent	Percentage	Base Rent	Rent
	Year	Area	12/31/10	($000’s)	of Total 2010	Per Sq. Ft.	Per Sq. Ft.
Property Location	Built	(Sq. Ft.)	(%) (a)	(b) (c)	Base Rent (%)	($) (c) (d)	($) (c) (e)
Yonkers
100 Corporate Boulevard	1987	78,000	98.3	1,554	0.26	20.27	19.16
200 Corporate Boulevard South	1990	84,000	99.8	1,571	0.26	18.74	17.93
4 Executive Plaza	1986	80,000	100.0	1,379	0.23	17.24	12.95
6 Executive Plaza	1987	80,000	99.2	1,511	0.25	19.04	17.54
1 Odell Plaza	1980	106,000	99.9	1,363	0.23	12.87	11.57
3 Odell Plaza	1984	71,065	100.0	1,596	0.26	22.46	20.83
5 Odell Plaza	1983	38,400	99.6	576	0.10	15.06	11.74
7 Odell Plaza	1984	42,600	99.6	771	0.13	18.17	17.02
Total New York Office/Flex		2,348,812	97.8	34,606	5.75	15.06	13.38
CONNECTICUT
Fairfield County
Stamford
419 West Avenue	1986	88,000	100.0	1,363	0.23	15.49	13.84
500 West Avenue	1988	25,000	100.0	435	0.07	17.40	15.68
550 West Avenue	1990	54,000	100.0	932	0.15	17.26	16.91
600 West Avenue	1999	66,000	100.0	403	0.07	6.11	5.55
650 West Avenue	1998	40,000	100.0	686	0.11	17.15	15.90
Total Connecticut Office/Flex		273,000	100.0	3,819	0.63	13.99	12.91
TOTAL OFFICE/FLEX PROPERTIES		4,811,343	94.2	56,588	9.40	12.49	10.92

27

Industrial/Warehouse, Retail and Land Lease Properties
							2010
			Percentage	2010		2010	Average
		Net	Leased	Base		Average	Effective
		Rentable	as of	Rent	Percentage	Base Rent	Rent
	Year	Area	12/31/10	($000’s)	of Total 2010	Per Sq. Ft.	Per Sq. Ft.
Property Location	Built	(Sq. Ft.)	(%) (a)	(b) (c)	Base Rent (%)	($) (c) (d)	($) (c) (e)
NEW YORK
Westchester County
Elmsford
1 Warehouse Lane (f)	1957	6,600	100.0	96	0.02	14.55	12.73
2 Warehouse Lane (f)	1957	10,900	100.0	149	0.02	13.67	13.03
3 Warehouse Lane (f)	1957	77,200	100.0	363	0.06	4.70	4.48
4 Warehouse Lane (f)	1957	195,500	96.7	1,845	0.31	9.76	8.79
5 Warehouse Lane (f)	1957	75,100	97.1	939	0.16	12.88	11.30
6 Warehouse Lane (f)	1982	22,100	100.0	538	0.09	24.34	23.53
Total Industrial/Warehouse Properties		387,400	97.8	3,930	0.66	10.38	9.45
Westchester County
Tarrytown
230 White Plains Road	1984	9,300	100.0	179	0.03	19.25	18.82
Yonkers
2 Executive Boulevard	1986	8,000	100.0	35	0.01	4.38	4.38
Total Retail Properties		17,300	100.0	214	0.04	12.37	12.14
Westchester County
Elmsford
700 Executive Boulevard	--	--	--	148	0.02	--	--
Yonkers
1 Enterprise Boulevard	--	--	--	185	0.03	--	--
Total New York Land Leases		--	--	333	0.05	--	--
Prince George’s County, Maryland
Greenbelt
Capital Office Park Parcel A	--	--	--	153	0.03	--	--
Total Maryland Land Leases		--	--	153	0.03	--	--
Total Land Leases		--	--	486	0.08	--	--
TOTAL PROPERTIES		30,994,779	89.1	602,357	100.00	21.81	19.04

(a) Percentage leased includes all leases in effect as of the period end date, some of which have commencement dates in the future and leases expiring December 31, 2010 aggregating 187,058 square feet (representing 0.6percent of the Company’s total net rentable square footage) for which no new leases were signed.

(b) Total base rent for 2010, determined in accordance with generally accepted accounting principles (“GAAP”).  Substantially all of the leases provide for annual base rents plus recoveries and escalation charges based upon the tenant’s proportionate share of and/or increases in real estate taxes and certain operating costs, as defined, and the pass through of charges for electrical usage.

(c)   Excludes space leased by the Company.

(d) Base rent for 2010 divided by net rentable square feet leased at December 31, 2010

(e) Total base rent for 2010 minus total 2010 amortization of tenant improvements, leasing commissions and other concessions and costs, determined in accordance with GAAP, divided by net rentable square feet leased at December 31, 2010.

(f) This property is located on land leased by the Company.

(g) As this property was acquired, placed in service or initially consolidated by the Company during 2010, the amounts represented in 2010 base rent reflect only that portion of the year during which the Company owned or consolidated the property.  Accordingly, these amounts may not be indicative of the property’s full year results.  For comparison purposes, the amounts represented in 2010 average base rent per sq. ft. and 2010 effective rent per sq. ft. for this property have been calculated by taking 2010 base rent and 2010 effective rent for such property and annualizing these partial-year results, dividing such annualized amounts by the net rentable square feet leased at December 31, 2010.  These annualized per square foot amounts may not be indicative of the property’s results had the Company owned or consolidated the property for the entirety of 2010.

28

PERCENTAGE LEASED

The following table sets forth the year-end percentages of square feet leased in the Company’s stabilized operating Consolidated Properties for the last five years:

	Percentage of
December 31,	Square Feet Leased (%) (a)
2010	89.1
2009	90.1
2008	91.3
2007	92.7
2006	92.0

(a)   Percentage of square-feet leased includes all leases in effect as of the period end date, some of which have commencement dates in the future and leases that expire at the period end date.

29

SIGNIFICANT TENANTS

The following table sets forth a schedule of the Company’s 50 largest tenants for the Consolidated Properties as of December 31, 2010 based upon annualized base rental revenue:

			Percentage of
		Annualized	Company	Square	Percentage	Year of
	Number of	Base Rental	Annualized Base	Feet	Total Company	Lease
	Properties	Revenue ($) (a)	Rental Revenue (%)	Leased	Leased Sq. Ft. (%)	Expiration
National Union Fire Insurance
Company of Pittsburgh, PA	3	13,648,052	2.2	472,651	1.7	(b)
DB Services New Jersey, Inc.	2	10,905,426	1.8	402,068	1.5	2017
New Cingular Wireless PCS, LLC	4	9,744,793	1.6	433,296	1.6	(c)
Wyndham Worldwide Operations	2	9,258,626	1.5	395,392	1.5	(d)
Keystone Mercy Health Plan	2	8,973,210	1.5	303,149	1.1	2020
United States of America-GSA	11	8,824,842	1.4	286,354	1.1	(e)
Prentice-Hall, Inc.	1	8,643,699	1.4	474,801	1.8	2014
Forest Research Institute, Inc.	1	8,271,398	1.3	215,659	0.8	2017
AT&T Corp.	2	7,934,132	1.3	395,528	1.5	(f)
ICAP Securities USA, LLC	1	6,304,775	1.0	159,834	0.6	2017
Toys 'R' Us – NJ, Inc.	1	6,152,682	1.0	242,518	0.9	2012
TD Ameritrade Online Holdings	1	6,036,278	1.0	188,776	0.7	2020
Daiichi Sankyo, Inc.	2	6,015,498	1.0	180,807	0.7	(g)
Credit Suisse (USA), Inc.	1	5,212,307	0.8	153,464	0.6	(h)
Merrill Lynch Pierce Fenner	1	5,001,213	0.8	294,189	1.1	2017
IBM Corporation	2	4,991,121	0.8	292,304	1.1	(i)
Montefiore Medical Center	5	4,905,268	0.8	222,670	0.8	(j)
National Financial Services	1	4,798,621	0.8	112,964	0.4	2012
KPMG, LLP	3	4,735,115	0.8	176,659	0.7	(k)
Allstate Insurance Company	8	4,665,368	0.8	221,156	0.8	(l)
Bank Of Tokyo-Mitsubishi, Ltd.	1	4,454,970	0.7	137,076	0.5	2019
J.H. Cohn, LLP	2	4,323,277	0.7	155,056	0.6	(m)
Vonage America, Inc.	1	4,091,500	0.7	350,000	1.3	2017
Morgan Stanley Smith Barney	4	4,061,541	0.7	142,530	0.5	(n)
Arch Insurance Company	1	3,685,118	0.6	106,815	0.4	2024
Morgan Stanley & Co., Inc.	1	3,674,040	0.6	306,170	1.1	2013
American Institute of Certified Public
Accountants	1	3,455,040	0.6	142,953	0.5	2012
Oppenheimer & Co., Inc.	1	3,269,465	0.5	118,871	0.4	(o)
E*Trade Financial Corporation	1	3,124,160	0.5	106,573	0.4	2022
Shaw Facilities, Inc.	3	3,071,838	0.5	141,172	0.5	(p)
Dow Jones & Company, Inc.	1	3,057,773	0.5	92,312	0.3	2012
Alpharma, LLC	1	3,009,116	0.5	112,235	0.4	2018
SunAmerica Asset Management	1	2,958,893	0.5	69,621	0.2	2018
United States Life Insurance Co.	1	2,880,000	0.5	180,000	0.7	2013
Tullett Prebon Holdings Corp.	1	2,863,412	0.5	113,041	0.4	(q)
HQ Global Workplaces, LLC	7	2,831,482	0.5	133,209	0.5	(r)
High Point Safety & Insurance	2	2,827,665	0.5	116,889	0.4	2020
Lehman Brothers Holdings, Inc.	1	2,631,235	0.4	74,114	0.3	2012
Regus Business Centre Corp.	2	2,609,160	0.4	79,805	0.3	(s)
Natixis North America, Inc.	1	2,603,297	0.4	89,907	0.3	2021
Connell Foley, LLP	2	2,572,383	0.4	97,822	0.4	2015
AAA Mid-Atlantic, Inc.	2	2,535,780	0.4	129,784	0.5	(t)
New Jersey Turnpike Authority	1	2,530,631	0.4	100,223	0.4	2017
Tradeweb Markets, LLC	1	2,490,140	0.4	64,976	0.2	2017
Movado Group, Inc	1	2,449,828	0.4	90,050	0.3	2013
Lowenstein Sandler, P.C.	1	2,442,255	0.4	98,677	0.4	2017
Savvis Communications Corporation	1	2,430,116	0.3	71,474	0.2	2015
Sony Music Entertainment	1	2,359,986	0.3	97,653	0.4	2014
Rothstein, Kass & Company, P.C.	1	2,216,300	0.3	88,652	0.3	2017
Norris McLaughlin & Marcus, PA	1	2,216,278	0.3	86,913	0.3	2017
Totals		234,749,103	38.0	9,318,812	34.4

See footnotes on subsequent page.

30

Significant Tenants Footnotes

(a)   Annualized base rental revenue is based on actual December 2010 billings times 12.  For leases whose rent commences after January 1, 2011, annualized base rental revenue is based on the first full month’s billing times 12.  As annualized base rental revenue is not derived from historical GAAP results, historical results may differ from those set forth above.

(b)   69,944 square feet expire in 2012; 14,056 square feet expire in 2013; 271,533 square feet expire in 2018; 117,118 square feet expire 2019.

(c)   333,145 square feet expire in 2013; 72,385 square feet expire in 2014; 27,766 square feet expire in 2015.

(d)   145,983 square feet expire in 2011; 249,409 square feet expire in 2024.

(e)   9,901 square feet expire in 2011; 11,216 square feet expire in 2012; 65,438 square feet expire in 2013; 4,879 square feet expire in 2014; 180,729 square feet expire in 2015; 5,950 square feet expire in 2016; 8,241 square feet expire in 2017.

(f)   120,528 square feet expire in 2011; 275,000 square feet expire in 2014.

(g)   8,907 square feet expire in 2013; 171,900 square feet expire in 2022.

(h)   71,511 square feet expire in 2011; 81,953 square feet expire in 2012.

(i)   248,399 square feet expire in 2012; 43,905 square feet expire in 2013.

(j)   5,850 square feet expire in 2014; 7,200 square feet expire in 2016; 30,872 square feet expire in 2017; 36,385 square feet expire in 2018; 133,763 square feet expire in 2019; 8,600 square feet expire in 2020.

(k)   77,381 square feet expire in 2012; 53,409 square feet expire in 2019; 45,869 square feet expire in 2020.

(l)   70,933 square feet expire in 2011; 29,005 square feet expire in 2013; 4,456 square feet expire in 2014; 5,348 square feet expire in 2015; 4,014 square feet expire in 2016; 53,983 square feet expire in 2017; 53,417 square feet expire in 2018.

(m)   1,021 square feet expire in 2014; 154,035 square feet expire in 2020.

(n)   26,834 square feet expire in 2014; 29,654 square feet expire in 2015; 63,260 square feet expire in 2016; 22,782 square feet expire in 2018.

(o)   104,008 square feet expire in 2013; 14,863 square feet expire in 2017.

(p)   39,060 square feet expire in 2013; 102,112 square feet expire in 2015.

(q)   12,282 square feet expire in 2011; 100,759 square feet expire in 2023.

(r)   22,064 square feet expire in 2013; 22,279 square feet expire in 2015; 33,649 square feet expire in 2018; 19,485 square feet expire in 2019; 21,008 square feet expire in 2020; 14,724 square feet expire in 2021.

(s)   40,875 square feet expire in 2011; 38,930 square feet expire in 2016.

(t)   9,784 square feet expire in 2017; 120,000 square feet expire in 2022.

31

SCHEDULE OF LEASE EXPIRATIONS: ALL CONSOLIDATED PROPERTIES

The following table sets forth a schedule of lease expirations for the total of the Company’s office, office/flex, industrial/warehouse and stand-alone retail properties included in the Consolidated Properties beginning January 1, 2011, assuming that none of the tenants exercise renewal or termination options:

							Average
							Annual Base
				Percentage Of			Rent Per Net
		Net Rentable		Total Leased		Annualized	Rentable	Percentage Of
		Area Subject		Square Feet		Base Rental	Square Foot	Annual Base
	Number Of	To Expiring		Represented		Revenue Under	Represented	Rent Under
Year Of	Leases	Leases		By Expiring		Expiring	By Expiring	Expiring
Expiration	Expiring (a)	(Sq. Ft.)		Leases (%)		Leases ($) (b)	Leases ($)	Leases (%)
2011 (c)	358	2,381,669		8.8		55,287,305	23.21	9.0
2012	372	3,011,077		11.1		71,996,645	23.91	11.7
2013	378	3,725,257		13.8		79,591,577	21.37	12.9
2014	303	2,952,299		10.9		64,388,903	21.81	10.4
2015	261	3,198,784		11.8		69,360,282	21.68	11.2
2016	202	2,215,906		8.2		48,418,940	21.85	7.8
2017	135	2,909,617		10.7		68,454,318	23.53	11.1
2018	87	1,630,330		6.0		39,030,171	23.94	6.3
2019	57	1,119,330		4.1		25,216,359	22.53	4.1
2020	50	1,083,340		4.0		24,209,864	22.35	3.9
2021	49	923,060		3.4		23,013,804	24.93	3.7
2022 and thereafter	46	1,950,622		7.2		49,057,346	25.15	7.9
Totals/Weighted
Average	2,298	27,101,291	(c) (d)		100.0	618,025,514	22.80	100.0

(a)   Includes office, office/flex, industrial/warehouse and stand-alone retail property tenants only.  Excludes leases for amenity, retail, parking and month-to-month tenants.  Some tenants have multiple leases.

(b)   Annualized base rental revenue is based on actual December 2010 billings times 12.  For leases whose rent commences after January 1, 2011, annualized base rental revenue is based on the first full month’s billing times 12.  As annualized base rental revenue is not derived from historical GAAP results, historical results may differ from those set forth above.

(c)   Includes leases expiring December 31, 2010 aggregating 187,058 square feet and representing annualized rent of $3,827,976 for which no new leases were signed.

(d)   Reconciliation to Company’s total net rentable square footage is as follows:

	Square Feet
Square footage leased to commercial tenants	27,101,291
Square footage used for corporate offices, management offices,
building use, retail tenants, food services, other ancillary
service tenants and occupancy adjustments	522,451
Square footage unleased	3,371,037
Total net rentable square footage (does not include land leases)	30,994,779

32

SCHEDULE OF LEASE EXPIRATIONS: OFFICE PROPERTIES

The following table sets forth a schedule of lease expirations for the office properties beginning January 1, 2011, assuming that none of the tenants exercise renewal or termination options:

						Average
						Annual Base
			Percentage Of			Rent Per Net
		Net Rentable	Total Leased		Annualized	Rentable	Percentage Of
		Area Subject	Square Feet		Base Rental	Square Foot	Annual Base
	Number Of	To Expiring	Represented By		Revenue Under	Represented	Rent Under
Year Of	Leases	Leases	Expiring		Expiring	By Expiring	Expiring
Expiration	Expiring (a)	(Sq. Ft.)	Leases (%)		Leases ($) (b)	Leases ($)	Leases (%)
2011 (c)	291	1,937,656	8.5		49,896,473	25.75	9.1
2012	285	2,321,643	10.5		63,482,789	27.34	11.5
2013	285	2,768,529	12.5		66,009,413	23.84	11.9
2014	243	2,351,998	10.6		57,042,676	24.25	10.3
2015	217	2,811,124	12.7		64,582,772	22.97	11.7
2016	166	1,811,379	8.2		42,702,705	23.57	7.7
2017	110	2,651,971	12.0		64,763,925	24.42	11.7
2018	62	1,186,896	5.4		33,363,353	28.11	6.0
2019	40	752,331	3.4		19,806,107	26.33	3.6
2020	39	909,792	4.1		22,109,470	24.30	4.0
2021	43	861,513	3.9		22,173,117	25.74	4.0
2022 and thereafter	40	1,825,083	8.2		47,253,148	25.89	8.5
Totals/Weighted
Average	1,821	22,189,915 (c)		100.0	553,185,948	24.93	100.0

(a)   Includes office tenants only.  Excludes leases for amenity, retail, parking and month-to-month tenants.  Some tenants have multiple leases.

(b)   Annualized base rental revenue is based on actual December 2010 billings times 12.  For leases whose rent commences after January 1, 2011, annualized base rental revenue is based on the first full month’s billing times 12.  As annualized base rental revenue is not derived from historical GAAP results, historical results may differ from those set forth above.

(c)   Includes leases expiring December 31, 2010 aggregating 159,154 square feet and representing annualized rent of $3,430,877 for which no new leases were signed.

33

SCHEDULE OF LEASE EXPIRATIONS: OFFICE/FLEX PROPERTIES

The following table sets forth a schedule of lease expirations for the office/flex properties beginning January 1, 2011, assuming that none of the tenants exercise renewal or termination options:

						Average
						Annual Base
			Percentage Of			Rent Per Net
		Net Rentable	Total Leased		Annualized	Rentable	Percentage Of
		Area Subject	Square Feet		Base Rental	Square Foot	Annual Base
	Number Of	To Expiring	Represented By		Revenue Under	Represented	Rent Under
Year Of	Leases	Leases	Expiring		Expiring	By Expiring	Expiring
Expiration	Expiring (a)	(Sq. Ft.)	Leases (%)		Leases ($) (b)	Leases ($)	Leases (%)
2011 (c)	67	444,013	9.8		5,390,832	12.14	8.9
2012	87	689,434	15.3		8,513,856	12.35	14.1
2013	82	802,423	17.8		12,165,876	15.16	20.2
2014	56	560,456	12.4		6,531,909	11.65	10.8
2015	43	359,660	8.0		4,441,510	12.35	7.4
2016	32	373,539	8.3		5,375,177	14.39	8.9
2017	25	257,646	5.7		3,690,393	14.32	6.1
2018	24	308,352	6.8		4,236,818	13.74	7.0
2019	17	366,999	8.1		5,410,252	14.74	9.0
2020	11	173,548	3.8		2,100,394	12.10	3.5
2021	6	61,547	1.4		840,687	13.66	1.4
2022 and thereafter	5	117,539	2.6		1,640,998	13.96	2.7
Totals/Weighted
Average	455	4,515,156 (c)		100.0	60,338,702	13.36	100.0

(a)   Includes office/flex tenants only.  Excludes leases for amenity, retail, parking and month-to-month tenants.  Some tenants have multiple leases.

(b)   Annualized base rental revenue is based on actual December 2010 billings times 12.  For leases whose rent commences after January 1, 2011, annualized base rental revenue is based on the first full month’s billing times 12.  As annualized base rental revenue is not derived from historical GAAP results, historical results may differ from those set forth above. Includes office/flex tenants only.  Excludes leases for amenity, retail, parking and month-to-month tenants.  Some tenants have multiple leases.

(c)   Includes leases expiring December 31, 2010 aggregating 27,904 square feet and representing annualized rent of $397,098 for which no new leases were signed.

34

SCHEDULE OF LEASE EXPIRATIONS: INDUSTRIAL/WAREHOUSE PROPERTIES

The following table sets forth a schedule of lease expirations for the industrial/warehouse properties beginning January 1, 2011, assuming that none of the tenants exercise renewal or termination options:

					Average
					Annual Base
			Percentage Of		Rent Per Net
		Net Rentable	Total Leased	Annualized	Rentable	Percentage Of
		Area Subject	Square Feet	Base Rental	Square Foot	Annual Base
	Number Of	To Expiring	Represented By	Revenue Under	Represented	Rent Under
Year Of	Leases	Leases	Expiring	Expiring	By Expiring	Expiring
Expiration	Expiring (a)	(Sq. Ft.)	Leases (%)	Leases ($) (b)	Leases ($)	Leases (%)
2013	11	154,305	40.7	1,416,288	9.18	34.0
2014	3	30,545	8.1	639,318	20.93	15.4
2015	1	28,000	7.4	336,000	12.00	8.0
2016	4	30,988	8.2	341,058	11.01	8.2
2018	1	135,082	35.6	1,430,000	10.59	34.4
Totals/Weighted
Average	20	378,920	100.0	4,162,664	10.99	100.0

(a)   Includes industrial/warehouse tenants only.  Excludes leases for amenity, retail, parking and month-to-month industrial/warehouse tenants.  Some tenants have multiple leases.

(b)   Annualized base rental revenue is based on actual December 2010 billings times 12.  For leases whose rent commences after January 1, 2011, annualized base rental revenue is based on the first full month’s billing times 12.  As annualized base rental revenue is not derived from historical GAAP results, the historical results may differ from those set forth above.

SCHEDULE OF LEASE EXPIRATIONS: STAND-ALONE RETAIL PROPERTIES

The following table sets forth a schedule of lease expirations for the stand-alone retail properties beginning January 1, 2011 assuming that none of the tenants exercise renewal or termination options:

					Average
					Annual Base
			Percentage Of		Rent Per Net
		Net Rentable	Total Leased	Annualized	Rentable	Percentage Of
		Area Subject	Square Feet	Base Rental	Square Foot	Annual Base
	Number Of	To Expiring	Represented By	Revenue Under	Represented	Rent Under
Year Of	Leases	Leases	Expiring	Expiring	By Expiring	Expiring
Expiration	Expiring (a)	(Sq. Ft.)	Leases (%)	Leases ($) (b)	Leases ($)	Leases (%)
2014	1	9,300	53.8	175,000	18.82	51.7
2022 and beyond	1	8,000	46.2	163,200	20.40	48.3
Totals/Weighted
Average	2	17,300	100.0	338,200	19.55	100.0

(a)   Includes stand-alone retail property tenants only.

(b)   Annualized base rental revenue is based on actual December 2010 billings times 12.  For leases whose rent commences after January 1, 2011, annualized base rental revenue is based on the first full month’s billing times 12.  As annualized base rental revenue is not derived from historical GAAP results, historical results may differ from those set forth above.

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INDUSTRY DIVERSIFICATION

The following table lists the Company’s 30 largest industry classifications based on annualized contractual base rent of the Consolidated Properties:

Industry Classification (a)	Annualized Base Rental Revenue ($) (b) (c) (d)	Percentage of Company Annualized Base Rental Revenue (%)	Square Feet Leased (c) (d)	Percentage of Total Company Leased Sq. Ft. (%)
Securities, Commodity Contracts & Other Financial	91,706,655	14.7	3,386,515	12.3
Insurance Carriers & Related Activities	59,530,284	9.6	2,402,461	8.9
Manufacturing	49,267,387	8.0	2,552,135	9.4
Telecommunications	42,083,790	6.8	2,148,980	7.9
Legal Services	36,845,947	6.0	1,403,586	5.2
Health Care & Social Assistance	29,705,006	4.8	1,418,535	5.2
Computer System Design Services	27,808,954	4.5	1,343,686	5.0
Credit Intermediation & Related Activities	27,204,376	4.4	1,023,261	3.8
Accounting/Tax Prep.	20,706,597	3.4	786,784	2.9
Scientific Research/Development	20,507,079	3.3	736,485	2.7
Wholesale Trade	19,806,813	3.2	1,324,965	4.9
Architectural/Engineering	16,459,431	2.7	750,509	2.8
Admin & Support, Waste Mgt. & Remediation Services	15,791,420	2.6	761,150	2.8
Retail Trade	14,777,916	2.4	737,482	2.7
Public Administration	14,484,613	2.3	555,019	2.0
Other Services (except Public Administration)	13,999,576	2.3	557,319	2.1
Management/Scientific	12,042,760	1.9	485,221	1.8
Accommodation & Food Services	11,511,920	1.9	501,945	1.9
Arts, Entertainment & Recreation	11,427,343	1.8	685,630	2.5
Real Estate & Rental & Leasing	11,232,564	1.8	502,028	1.9
Advertising/Related Services	9,220,403	1.5	376,187	1.4
Construction	7,773,223	1.3	368,621	1.4
Other Professional	7,053,400	1.1	318,306	1.2
Publishing Industries	6,186,359	1.0	247,613	0.9
Information Services	6,064,190	1.0	237,339	0.9
Data Processing Services	5,689,535	0.9	216,041	0.8
Transportation	5,453,060	0.9	291,586	1.1
Utilities	5,316,017	0.9	215,395	0.8
Broadcasting	5,276,310	0.9	189,010	0.7
Educational Services	3,726,349	0.6	189,903	0.7
Other	9,366,237	1.5	387,594	1.4
TOTAL	618,025,514	100.0	27,101,291	100.0

  (a) The Company’s tenants are classified according to the U.S. Government’s North American Industrial Classification System (NAICS).

  (b) Annualized base rental revenue is based on actual December 2010 billings times 12.  For leases whose rent commences after January 1, 2011, annualized base rental revenue is based on the first full month’s billing times 12.  As annualized base rental revenue is not derived from historical GAAP results, historical results may differ from those set forth above.

  (c) Includes office, office/flex, industrial/warehouse and stand-alone retail tenants only.  Excludes leases for amenity, retail, parking and month-to-month tenants. Some tenants have multiple leases.

  (d) Includes leases in effect as of the period end date, some of which have commencement dates in the future, and leases expiring December 31, 2010 aggregating 187,058 square feet and representing annualized rent of $3,827,976 for which no new leases were signed.

36

MARKET DIVERSIFICATION

The following table lists the Company’s markets (MSAs), based on annualized contractual base rent of the Consolidated Properties:

		Percentage Of
		Company
	Annualized Base	Annualized	Total Property
	Rental Revenue	Base Rental	Size Rentable	Percentage Of
Market (MSA)	($) (a) (b) (c)	Revenue (%)	Area (b) (c)	Rentable Area (%)
Newark, NJ
(Essex-Morris-Union Counties)	138,969,969	22.4	6,495,715	21.0
Jersey City, NJ	117,260,604	19.0	4,317,978	13.9
Westchester-Rockland, NY	92,544,600	15.0	4,968,420	16.0
Bergen-Passaic, NJ	83,179,659	13.5	4,573,554	14.8
Philadelphia, PA-NJ	56,638,134	9.2	3,529,994	11.4
Middlesex-Somerset-Hunterdon, NJ	40,930,985	6.6	2,116,628	6.8
Washington, DC-MD-VA-WV	26,951,239	4.4	1,292,807	4.2
Monmouth-Ocean, NJ	24,379,690	3.9	1,620,863	5.2
Trenton, NJ	17,964,036	2.9	956,597	3.1
Stamford-Norwalk, CT	10,459,595	1.7	597,747	1.9
New York (Manhattan)	8,747,003	1.4	524,476	1.7
Totals	618,025,514	100.0	30,994,779	100.0

(a) Annualized base rental revenue is based on actual December 2010 billings times 12.  For leases whose rent commences after January 1, 2011, annualized base rental revenue is based on the first full month’s billing times 12.  As annualized base rental revenue is not derived from historical GAAP results, historical results may differ from those set forth above.

(b) Includes leases in effect as of the period end date, some of which have commencement dates in the future, and leases expiring December 31, 2010 aggregating 187,058 square feet and representing annualized rent of $3,827,976 for which no new leases were signed.

(c) Includes office, office/flex, industrial/warehouse and stand-alone retail tenants only.  Excludes leases for amenity, retail, parking and month-to-month tenants. Some tenants have multiple leases.

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ITEM 3.                 LEGAL PROCEEDINGS

There are no material pending legal proceedings, other than ordinary routine litigation incidental to its business, to which the Company is a party or to which any of the Properties is subject.

ITEM 4.                 (Removed and Reserved).

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PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

MARKET INFORMATION

The shares of the Corporation’s Common Stock are traded on the New York Stock Exchange (“NYSE”) under the symbol “CLI.”

On June 4, 2010, the Corporation filed with the NYSE its annual CEO Certification and Annual Written Affirmation pursuant to Section 303A.12 of the NYSE Listed Company Manual, each certifying that the Corporation was in compliance with all of the listing standards of the NYSE.

HOLDERS

On February 8, 2011, the Company had 129 owners of limited partnership units and one owner of General Partnership units.

RECENT SALES OF UNREGISTERED SECURITIES; USES OF PROCEEDS FROM REGISTERED SECURITIES

None.

DIVIDENDS AND DISTRIBUTIONS

The declaration and payment of dividends and distributions will continue to be determined by the Corporation’s Board of Directors in light of conditions then existing, including the Company’s earnings, cash flows, financial condition, capital requirements, debt maturities, the availability of debt and equity capital, applicable REIT and legal restrictions and the general overall economic conditions and other factors.

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PERFORMANCE GRAPH

The following graph compares total stockholder returns from the last five fiscal years to the Standard & Poor’s 500 Index (“S&P 500”) and to the National Association of Real Estate Investment Trusts, Inc.’s Equity REIT Total Return Index (“NAREIT”).  The graph assumes that the value of the investment in the Corporation’s Common Stock and in the S&P 500 and NAREIT indices was $100 at December 31, 2005 and that all dividends were reinvested.  The price of the Corporation’s Common Stock on December 31, 2005 (on which the graph is based) was $43.20.  The past stockholder return shown on the following graph is not necessarily indicative of future performance.

Comparison of Five-Year Cumulative Total Return

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SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

Equity Compensation Plan Information

The following table summarizes information, as of December 31, 2010, relating to equity compensation plans of the Corporation (including individual compensation arrangements) pursuant to which equity securities of the Corporation are authorized for issuance.

Plan Category	(a) Number of Securities to be Issued Upon Exercise of Outstanding Options and Rights	(b) Weighted-Average Exercise Price of Outstanding Options and Rights	(c) Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (excluding securities reflected in column(a))
Equity Compensation Plans Approved by Stockholders	535,435 (2)	29.05 (3)	2,425,073
Equity Compensation Plans Not Approved by Stockholders(1)	84,236	N/A	N/A   (4)
Total	619,671	N/A	2,425,073

(1) The only plan included in the table that was adopted without stockholder approval was the Directors’ Deferred Compensation Plan.  See Note 11: Mack-Cali Realty, L.P. Partners’ Capital - Deferred Stock Compensation Plan For Directors.

(2)           Includes 239,759 shares of restricted Common Stock.

(3)           Weighted-average exercise price of outstanding options; excludes restricted Common Stock.

(4)   The Directors’ Deferred Compensation Plan does not limit the number of stock units issuable thereunder, but applicable SEC and NYSE rules restricted the aggregate number of stock units issuable thereunder to one percent (1%) of the Corporation’s outstanding shares when the plan commenced on January 1, 1999.

PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

None.

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ITEM 6.                 SELECTED FINANCIAL DATA

The following table sets forth selected financial data on a consolidated basis for the Company.  The consolidated selected operating, balance sheet and other data of the Company as of December 31, 2010, 2009, 2008, 2007 and 2006, and for the years then ended have been derived from the Company’s financial statements for the respective periods.

Operating Data (a)	Year Ended December 31,
In thousands, except per unit data	2010	2009	2008	2007	2006
Total revenues	$  787,480	$   758,925	$   772,780	$   803,162	$   729,007
Property expenses (b)	$  282,064	$   274,418	$   277,142	$   268,404	$   252,176
Direct construction costs	$    60,255	$     20,323	$     37,649	$     85,180	$     53,602
General and administrative	$    35,003	$     39,779	$     43,861	$     52,156	$     49,071
Interest expense	$  149,329	$   140,068	$   126,937	$   125,467	$   134,197
Income from continuing operations	$    58,750	$     80,308	$     65,390	$     88,790	$   105,372
Net income available to common unitholders	$    61,701	$     62,671	$     63,543	$   132,966	$   177,692
Income from continuing operations
per unit – basic	$        0.62	$         0.90	$         0.79	$         1.06	$         1.32
Income from continuing operations
per unit – diluted	$        0.62	$         0.90	$         0.79	$         1.06	$         1.32
Net income per unit – basic	$        0.67	$         0.71	$         0.79	$         1.62	$         2.29
Net income per unit – diluted	$        0.67	$         0.71	$         0.79	$         1.61	$         2.28
Distributions declared per common unit	$        1.80	$         1.80	$         2.56	$         2.56	$         2.54
Basic weighted average units outstanding	92,373	88,346	80,404	82,216	77,523
Diluted weighted average units outstanding	92,477	88,389	80,648	82,500	77,901

Balance Sheet Data	December 31,
In thousands	2010	2009	2008	2007	2006
Rental property, before accumulated
depreciation and amortization	$5,216,720	$5,186,208	$4,963,780	$4,885,429	$4,573,587
Total assets	$4,362,466	$4,721,637	$4,443,922	$4,593,202	$4,422,889
Total debt (c)	$2,089,494	$2,337,437	$2,225,475	$2,211,735	$2,159,959
Total liabilities	$2,318,529	$2,578,447	$2,484,559	$2,492,797	$2,412,762
Total equity	$2,043,937	$2,143,190	$1,959,363	$2,100,405	$2,010,127

(a) Certain reclassifications have been made to prior period amounts in order to conform with current period presentation.

(b) Property expenses is calculated by taking the sum of real estate taxes, utilities and operating services for each of the periods presented.

(c) Total debt is calculated by taking the sum of senior unsecured notes, revolving credit facilities, and mortgages, loans payable and other obligations.

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the Consolidated Financial Statements of Mack-Cali Realty, L.P. and the notes thereto (collectively, the “Financial Statements”).  Certain defined terms used herein have the meaning ascribed to them in the Financial Statements.

Executive Overview

Mack-Cali Realty Corporation together with its subsidiaries, (the “Corporation” or the “General Partner”) is one of the largest real estate investment trusts (REITs) in the United States.  Mack-Cali Realty, L.P. (“the Company”) has been involved in all aspects of commercial real estate development, management and ownership for over 50 years and the Corporation has been a publicly-traded REIT since 1994.  The Company owns or has interests in 277properties (collectively, the “Properties”), primarily class A office and office/flex buildings, totaling approximately 32.2million square feet, leased to over 2,000tenants.  The Properties are located primarily in suburban markets of the Northeast, some with adjacent, Company-controlled developable land sites able to accommodate up to 12.5million square feet of additional commercial space.

The Company’s strategy is to be a significant real estate owner and operator in its core, high-barriers-to-entry markets, primarily in the Northeast.

As an owner of real estate, almost all of the Company’s earnings and cash flow is derived from rental revenue received pursuant to leased space at the Properties.  Key factors that affect the Company’s business and financial results include the following:

· the general economic climate;

· the occupancy rates of the Properties;

· rental rates on new or renewed leases;

· tenant improvement and leasing costs incurred to obtain and retain tenants;

· the extent of early lease terminations;

· operating expenses;

· cost of capital; and

· the extent of acquisitions, development and sales of real estate.

Any negative effects of the above key factors could potentially cause a deterioration in the Company’s revenue and/or earnings.  Such negative effects could include: (1) failure to renew or execute new leases as current leases expire; (2) failure to renew or execute new leases with rental terms at or above the terms of in-place leases; and (3) tenant defaults.

A failure to renew or execute new leases as current leases expire or to execute new leases with rental terms at or above the terms of in-place leases may be affected by several factors such as: (1) the local economic climate, which may be adversely impacted by business layoffs or downsizing, industry slowdowns, changing demographics and other factors; and (2) local real estate conditions, such as oversupply of office and office/flex space or competition within the market.

The Company’s core markets continue to be weak.  The percentage leased in the Company’s consolidated portfolio of stabilized operating properties was 89.1 percent at December 31, 2010 as compared to 90.1 percent at December 31, 2009 and 91.3 percent at December 31, 2008.  Percentage leased includes all leases in effect as of the period end date, some of which have commencement dates in the future and leases that expire at the period end date.  Leases that expired as of December 31, 2010, 2009 and 2008 aggregate 187,058, 64,672 and 67,473 square feet, respectively, or 0.6, 0.2 and 0.2 percentage of the net rentable square footage, respectively.  The Company believes that vacancy rates may continue to increase and rental rates may continue to decline in som e of its markets through 2011 and possibly beyond.  As a result, the Company’s future earnings and cash flow may continue to be negatively impacted by current market conditions.

43

The Company expects that the impact of the current state of the economy, including high unemployment will continue to have a negative effect on the fundamentals of its business, including lower occupancy, reduced effective rents, and increases in defaults and past due accounts.  These conditions would negatively affect the Company’s future net income and cash flows and could have a material adverse effect on the Company’s financial condition.

The remaining portion of this Management’s Discussion and Analysis of Financial Condition and Results of Operations should help the reader understand our:

· real estate transactions;

· critical accounting policies and estimates;

· results of operations for the year ended December 31, 2010 as compared to the year ended December 31, 2009;

· results of operations for the year ended December 31, 2009 as compared to the year ended December 31, 2008;

· liquidity and capital resources.

Real Estate Transactions

On December 17, 2010, the Company repaid a $26.8 million mortgage loan which encumbered One Grande Commons, a 198,376 square foot unconsolidated joint venture office property located in Bridgewater, New Jersey.  Concurrent with the repayment, the Company placed an $11 million mortgage financing on the property obtained from a bank. As a result of the repayment of the existing mortgage loan, the Company obtained a controlling interest and is consolidating the office property.  The new mortgage loan bears interest at a rate of LIBOR plus 200 basis points and matures on December 31, 2011, with three one-year extension options, subject to certain conditions and payment of a fee.

The Company’s office property located at 105 Challenger Road in Ridgefield Park, New Jersey, aggregating 150,050 square feet, was collateral for a $19.5 million mortgage loan scheduled to mature on June 6, 2010.  The Company had recorded an impairment charge on the property of $16.6 million at December 31, 2009.   On June 1, 2010, the Company transferred the deed for 105 Challenger to the lender in satisfaction of its obligations.  As a result, the Company recorded a gain on the disposal of the office property of approximately $4.4 million.

The Company’s office property located at 2200 Renaissance Boulevard in King of Prussia, Pennsylvania, aggregating 174,124 square feet, is collateral for a mortgage loan scheduled to mature on December 1, 2012 with a balance of $16.2 million at December 31, 2010.  As of December 31, 2010, the Company estimated that the carrying value of the property may not be recoverable over its anticipated holding period. In order to reduce the carrying value of the property to its estimated fair market value of approximately $13.4 million, the Company recorded an impairment charge of approximately $9.5 million at December 31, 2010.

Critical Accounting Policies and Estimates

The Financial Statements have been prepared in conformity with generally accepted accounting principles.  The preparation of the Financial Statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Financial Statements, and the reported amounts of revenues and expenses during the reported period.  These estimates and assumptions are based on management’s historical experience that are believed to be reasonable at the time.  However, because future events and their effects cannot be determined with certainty, the determination of estimates requires the exercise of judgment.  The Company’s critical accounting policies are those which require assumptions to be made about matters that are highly uncertain.  Different estimates could have a material effect on the Company’s financial results.  Judgments and uncertainties affecting the application of these policies and estimates may result in materially different amounts being reported under different conditions and circumstances.

Rental Property:

Rental properties are stated at cost less accumulated depreciation and amortization.  Costs directly related to the acquisition, development and construction of rental properties are capitalized.  Capitalized development and construction costs include pre-construction costs essential to the development of the property, development and construction costs, interest, property taxes, insurance, salaries and other project costs incurred during the period of development.  Interest capitalized by the Company for the years ended December 31, 2010, 2009 and 2008 was $1.9 million, $1.4 million and $5.8 million, respectively.  Ordinary repairs and maintenance are expensed as incurred; major replacements and betterments, which improve or extend the life of the asset, are capitalized and deprec iated over their estimated useful lives.  Fully-depreciated assets are removed from the accounts.

44

The Company considers a construction project as substantially completed and held available for occupancy upon the completion of tenant improvements, but no later than one year from cessation of major construction activity (as distinguished from activities such as routine maintenance and cleanup).  If portions of a rental project are substantially completed and occupied by tenants, or held available for occupancy, and other portions have not yet reached that stage, the substantially completed portions are accounted for as a separate project.  The Company allocates costs incurred between the portions under construction and the portions substantially completed and held available for occupancy and capitalizes only those costs associated with the portion under construction.

Properties are depreciated using the straight-line method over the estimated useful lives of the assets.  The estimated useful lives are as follows:

Leasehold interests	Remaining lease term
Buildings and improvements	5 to 40 years
Tenant improvements	The shorter of the term of the
	related lease or useful life
Furniture, fixtures and equipment	5 to 10 years

Upon acquisition of rental property, the Company estimates the fair value of acquired tangible assets, consisting of land, building and improvements, and identified intangible assets and liabilities generally consisting of the fair value of (i) above and below market leases, (ii) in-place leases and (iii) tenant relationships.  The Company allocates the purchase price to the assets acquired and liabilities assumed based on their fair values. The Company records goodwill or a gain on bargain purchase (if any) if the net assets acquired/liabilities assumed exceed the purchase consideration of a transaction. In estimating the fair value of the tangible and intangible assets acquired, the Company considers information obtained about each property as a result of its due diligence and marketing and leasing activities, and util izes various valuation methods, such as estimated cash flow projections utilizing appropriate discount and capitalization rates, estimates of replacement costs net of depreciation, and available market information.  The fair value of the tangible assets of an acquired property considers the value of the property as if it were vacant.

Above-market and below-market lease values for acquired properties are initially recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to each in-place lease and (ii) management’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases and the remaining initial term plus the term of any below-market fixed rate renewal options for below-market leases.  The capitalized above-market lease values are amortized as a reduction of base rental revenue over the remaining term of the respective leases, and the capitalized below-market lease values are amortized as an increase to ba se rental revenue over the remaining initial terms plus the terms of any below-market fixed rate renewal options of the respective leases.

Other intangible assets acquired include amounts for in-place lease values and tenant relationship values which are based on management’s evaluation of the specific characteristics of each tenant’s lease and the Company’s overall relationship with the respective tenant.  Factors to be considered by management in its analysis of in-place lease values include an estimate of carrying costs during hypothetical expected lease-up periods considering current market conditions, and costs to execute similar leases.  In estimating carrying costs, management includes real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease-up periods, depending on local market conditions.  In estimating costs to execute similar leases, manageme nt considers leasing commissions, legal and other related expenses.  Characteristics considered by management in valuing tenant relationships include the nature and extent of the Company’s existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals.  The value of in-place leases are amortized to expense over the remaining initial terms of the respective leases.  The value of tenant relationship intangibles will be amortized to expense over the anticipated life of the relationships.

45

On a periodic basis, management assesses whether there are any indicators that the value of the Company’s rental properties may be impaired.  In addition to identifying any specific circumstances which may affect a property or properties, management considers other criteria for determining which properties may require assessment for potential impairment.  The criteria considered by management include reviewing low leased percentages, significant near-term lease expirations, recently acquired properties, current and historical operating and/or cash flow losses, near-term mortgage debt maturities or other factors that might impact the Company’s intent and ability to hold the property.  A property’s value is impaired only if management’s estimate of the aggregate future cash flows (und iscounted and without interest charges) to be generated by the property is less than the carrying value of the property.  To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the property over the fair value of the property.  The Company’s estimates of aggregate future cash flows expected to be generated by each property are based on a number of assumptions.  These assumptions are generally based on management’s experience in its local real estate markets and the effects of current market conditions.  The assumptions are subject to economic and market uncertainties including, among others, demand for space, competition for tenants, changes in market rental rates, and costs to operate each property.  As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the future cash flows estimated by management in its impairment analyses may not be achieved, and actual losses or impairments may be realized in the future.

Rental Property Held for Sale and Discontinued Operations:

When assets are identified by management as held for sale, the Company discontinues depreciating the assets and estimates the sales price, net of selling costs, of such assets.  If, in management’s opinion, the net sales price of the assets which have been identified as held for sale is less than the net book value of the assets, a valuation allowance is established.  Properties identified as held for sale and/or sold are presented in discontinued operations for all periods presented.

If circumstances arise that previously were considered unlikely and, as a result, the Company decides not to sell a property previously classified as held for sale, the property is reclassified as held and used.  A property that is reclassified is measured and recorded individually at the lower of (a) its carrying amount before the property was classified as held for sale, adjusted for any depreciation (amortization) expense that would have been recognized had the property been continuously classified as held and used, or (b) the fair value at the date of the subsequent decision not to sell.

Investments in Unconsolidated Joint Ventures:

The Company accounts for its investments in unconsolidated joint ventures under the equity method of accounting.  The Company applies the equity method by initially recording these investments at cost, as Investments in Unconsolidated Joint Ventures, subsequently adjusted for equity in earnings and cash contributions and distributions.

Accounting Standards Codification (“ASC”) 810, Consolidation, provides guidance on the identification of entities for which control is achieved through means other than voting rights (“variable interest entities” or “VIEs”) and the determination of which business enterprise, if any, should consolidate the VIEs (the “primary beneficiary”).  Generally, the consideration of whether an entity is a VIE applies when either (1) the equity investors (if any) lack one or more of the essential characteristics of a controlling financial interest, (2) the equity investment at risk is insufficient to finance that entity’s activities without additional subordinated financial support or (3) the equity investors have voting rights that are not proportionate to their economic interests and the activities of the entity involve or are conducted on behalf of an investor with a disproportionately small voting interest.

On January 1, 2010, the Company adopted the updated provisions of ASC 810, pursuant to FASB No. 167, which amends FIN 46(R) to require ongoing reassessments of whether an enterprise is the primary beneficiary of a variable interest entity.  Additionally, FASB No. 167 amends FIN 46(R) to eliminate the quantitative approach previously required for determining the primary beneficiary of a variable interest entity, which was based on determining which enterprise absorbs the majority of the entity’s expected losses, receives a majority of the entity’s expected residual returns, or both.  FASB No. 167 amends certain guidance in Interpretation 46(R) for determining whether an entity is a variable interest entity.  Also, FASB No. 167 amends FIN 46(R) to require enhanced disclosures that will provide us ers of financial statements with more transparent information about an enterprise’s involvement in a variable interest entity.  The enhanced disclosures are required for any enterprise that holds a variable interest in a variable interest entity.  The adoption of this guidance did not have a material impact to the Financial Statements.  See Note 4: Investments in Unconsolidated Joint Ventures to the Financial Statements for disclosures regarding the Company’s unconsolidated joint ventures.

46

On a periodic basis, management assesses whether there are any indicators that the value of the Company’s investments in unconsolidated joint ventures may be impaired.  An investment is impaired only if management’s estimate of the value of the investment is less than the carrying value of the investment, and such decline in value is deemed to be other than temporary.  To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the value of the investment.  The Company’s estimates of value for each investment (particularly in commercial real estate joint ventures) are based on a number of assumptions that are subject to economic and market uncertainties including, among others, demand for space, competition for tenants, cha nges in market rental rates, and operating costs.  As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the values estimated by management in its impairment analyses may not be realized, and actual losses or impairment may be realized in the future.

Revenue Recognition:

Base rental revenue is recognized on a straight-line basis over the terms of the respective leases. Unbilled rents receivable represents the amount by which straight-line rental revenue exceeds rents currently billed in accordance with the lease agreements.  Above-market and below-market lease values for acquired properties are initially recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to each in-place lease and (ii) management’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases a nd the initial term plus the term of any below-market fixed-rate renewal options for below-market leases.  The capitalized above-market lease values for acquired properties are amortized as a reduction of base rental revenue over the remaining term of the respective leases, and the capitalized below-market lease values are amortized as an increase to base rental revenue over the remaining initial terms plus the terms of any below-market fixed-rate renewal options of the respective leases.  Escalations and recoveries from tenants are received from tenants for certain costs as provided in the lease agreements.  These costs generally include real estate taxes, utilities, insurance, common area maintenance and other recoverable costs.

Construction services revenue includes fees earned and reimbursements received by the Company for providing construction management and general contractor services to clients.  Construction services revenue is recognized on the percentage of completion method.  Using this method, profits are recorded on the basis of our estimates of the overall profit and percentage of completion of individual contracts.  A portion of the estimated profits is accrued based upon estimates of the percentage of completion of the construction contract.  This revenue recognition method involves inherent risks relating to profit and cost estimates.  Real estate services revenue includes property management, facilities management, leasing commission fees and other services, and payroll and related costs reimbu rsed from clients.  Other income includes income from parking spaces leased to tenants, income from tenants for additional services arranged for the Company and income from tenants for early lease terminations.

Allowance for Doubtful Accounts:

Management periodically performs a detailed review of amounts due from tenants to determine if accounts receivable balances are impaired based on factors affecting the collectability of those balances.  Management’s estimate of the allowance for doubtful accounts requires management to exercise significant judgment about the timing, frequency and severity of collection losses, which affects the allowance and net income.

47

Results From Operations

The following comparisons for the year ended December 31, 2010 (“2010”), as compared to the year ended December 31, 2009 (“2009”), and for 2009 as compared to the year ended December 31, 2008 (“2008”), make reference to the following:  (i) the effect of the “Same-Store Properties,” which represent all in-service properties owned by the Company at December 31, 2008, (for the 2010 versus 2009 comparison) and which represent all in-service properties owned by the Company at December 31, 2007, (for the 2009 versus 2008 comparison), excluding properties sold or held for sale through December 31, 2010; and (ii) the effect of the “Acquired Properties,” which represent all properties acquired by the Company, commencing initial operations or initially consolidated by the Company from January 1, 2009 through December 31, 2010 (for the 2010 versus 2009 comparison) and which represent all properties acquired by the Company or commencing initial operation from January 1, 2008 through December 31, 2009 (for the 2009 versus 2008 comparison).

48

Year Ended December 31, 2010 Compared to Year Ended December 31, 2009

	Year Ended
	December 31,						Dollar			Percent
(dollars in thousands)	2010			2009			Change			Change
Revenue from rental operations and other:
Base rents	$	602,357		$	611,061		$	(8,704	)		(1.4	)%
Escalations and recoveries from tenants		101,699			103,057			(1,358	)		(1.3	)
Other income		12,553			13,538			(985	)		(7.3	)
Total revenues from rental operations		716,609			727,656			(11,047	)		(1.5	)
Property expenses:
Real estate taxes		93,535			93,322			213			0.2
Utilities		74,077			70,927			3,150			4.4
Operating services		114,452			110,169			4,283			3.9
Total property expenses		282,064			274,418			7,646			2.8
Non-property revenues:
Construction services		62,997			21,910			41,087			187.5
Real estate services		7,874			9,359			(1,485	)		(15.9	)
Total non-property revenues		70,871			31,269			39,602			126.6
Non-property expenses:
Direct construction costs		60,255			20,323			39,932			196.5
General and administrative		35,003			39,779			(4,776	)		(12.0	)
Depreciation and amortization		191,168			200,732			(9,564	)		(4.8	)
Impairment charge on rental property		9,521			--			9,521			--
Total non-property expenses		295,947			260,834			35,113			13.5
Operating  income		209,469			223,673			(14,204	)		(6.4	)
Other (expense) income:
Interest expense		(149,329	)		(140,068	)		(9,261	)		(6.6	)
Interest and other investment income		86			570			(484	)		(84.9	)
Equity in earnings (loss) of unconsolidated
joint ventures		2,276			(5,560	)		7,836			140.9
Loss from early extinguishment of debt		(3,752	)		--			(3,752	)		--
Gain on reduction of other obligations		--			1,693			(1,693	)		(100.0	)
Total other (expense) income		(150,719	)		(143,365	)		(7,354	)		(5.1	)
Income from continuing operations		58,750			80,308			(21,558	)		(26.8	)
Discontinued Operations:
Income (loss) from discontinued operations		242			(17	)		259			1,523.5
Impairment charge on rental property		--			(16,563	)		16,563			100.0
Realized gains (losses) and unrealized losses
on disposition of rental property, net		4,447			--			4,447			--
Total discontinued operations, net		4,689			(16,580	)		21,269			128.3
Net income		63,439			63,728			(289	)		(0.5	)
Noncontrolling interest in consolidated joint
ventures		262			943			(681	)		(72.2	)
Preferred unit distributions		(2,000	)		(2,000	)		--			--
Net income available to common unitholders	$	61,701		$	62,671		$	(970	)		(1.5	)%

49

The following is a summary of the changes in revenue from rental operations and property expenses in 2010 as compared to 2009 divided into Same-Store Properties and Acquired Properties (dollars in thousands):

	Total Company		Same-Store Properties		Acquired Properties
	Dollar	Percent	Dollar	Percent	Dollar	Percent
	Change	Change	Change	Change	Change	Change
Revenue from rental operations:
Base rents	$   (8,704)	(1.4)%	$ (19,418)	(3.2)%	$ 10,714	1.8%
Escalations and recoveries
from tenants	(1,358)	(1.3)	(2,583)	(2.5)	1,225	1.2
Other income	(985)	(7.3)	(975)	(7.2)	(10)	(0.1)
Total	$ (11,047)	(1.5)%	$ (22,976)	(3.2)%	$ 11,929	1.7%
Property expenses:
Real estate taxes	$       213	0.2%	$   (1,416)	(1.5)%	$   1,629	1.7%
Utilities	3,150	4.4	2,807	4.0	343	0.4
Operating services	4,283	3.9	2,216	2.0	2,067	1.9
Total	$    7,646	2.8%	$     3,607	1.3%	$   4,039	1.5%
OTHER DATA:
Number of Consolidated Properties	268		254		14
Square feet (in thousands)	30,995		29,095		1,900

Base rents for the Same-Store Properties decreased $19.4million, or 3.2percent, for 2010 as compared to 2009, due primarily to decreased occupancy and rental rates in 2010 over 2009.  Escalations and recoveries from tenants for the Same-Store Properties decreased $2.6million, or 2.5 percent, for 2010 over 2009, due primarily to lower recoveries from newer tenants in 2010. Other income for the Same-Store Properties decreased $1.0million, or 7.2percent, due primarily to a decrease in tenant extra services in 2010.

Real estate taxes on the Same-Store Properties decreased $1.4 million, or 1.5 percent, for 2010 as compared to 2009, due primarily to reductions in certain property tax assessments and real estate tax refunds in 2010.  Utilities for the Same-Store Properties increased $2.8 million, or 4.0 percent, for 2010 as compared to 2009, due primarily to increased usage and rates in 2010 as compared to 2009.  Operating services for the Same-Store Properties increased $2.2 million, or 2.0 percent, due primarily to an increase in snow removal and maintenance costs in 2010 as compared to 2009.

Construction services revenue increased $41.1million, or 187.5 percent, in 2010 as compared to 2009, due primarily to increased construction contracts in 2010.  Real estate services revenues decreased by $1.5million, or 15.9percent, for 2010 as compared to 2009, due primarily to decreases in management fee income of $0.6million, salary reimbursements of $0.6million, and commissions income of $0.3million on account of a reduction in third party management and leasing assign ments in 2010.

Direct construction costs increased $39.9million, or 196.5percent, in 2010 as compared to 2009, due primarily to increased construction contracts in 2010.

General and administrative decreased by $4.8 million, or 12.0 percent, for 2010 as compared to 2009 due primarily to decreases in salaries and related expenses and professional fees in 2010.

Depreciation and amortization decreased by $9.6 million, or 4.8 percent, for 2010 over 2009.  This decrease was due primarily to assets becoming fully amortized in 2010.

In 2010, the Company incurred $9.5 million as an impairment charge on a rental property.

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Interest expense increased $9.3 million, or 6.6percent, for 2010 as compared to 2009.  This increase was primarily as a result of higher average debt balances and interest rates in 2010 as compared to 2009.

Interest and other investment income decreased $0.5 million, or 84.9 percent, for 2010 as compared to 2009.  This decrease was due primarily to the repayment of a note receivable in late 2009.

Equity in earnings of unconsolidated joint ventures increased $7.8 million, or 140.9 percent, for 2010 as compared to 2009.  The increase was due primarily to the write-off in 2009 of the Company’s investment in the Route 93 Portfolio venture for an increased loss of $4.4 million, a decreased loss of $4.1 million in the Boston-Downtown Crossing venture for 2010 as compared to 2009, increased income of $1.3 million in the Gale Kimball venture for 2010 as compared to 2009.  These were partially offset by decreased income of $2.6 million from the Harborside South Pier venture for 2010 as compared to 2009.

The Company recognized a loss from early extinguishment of debt of $3.8 million in 2010 as a result of the prepayment of $300 million of senior unsecured notes in 2010 which were scheduled to mature in February 2011.

The Company had a gain on reduction of other obligations of $1.7 million on account of the expiration of certain assumed obligations in 2009.

Income from continuing operations decreased to approximately $58.7 million in 2010 from $80.3 million in 2009.  The decrease of $21.6 million was due to the factors discussed above.

Net income available to common unitholders decreased by $1.0 million, or 1.5 percent, from $62.7 million in 2009 to $61.7 million in 2010.  The decrease was primarily the result of a decrease in income from continuing operations of $21.6 million and a decrease in noncontrolling interest in consolidated joint ventures of $0.7 million for 2010 as compared to 2009.  These were partially offset by an impairment charge on rental property of $16.6 million in 2009, a realized gain on disposition of rental property of $4.4 million in 2010, and an increase in income from discontinued operations of $0.3 million for 2010 as compared to 2009.

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Year Ended December 31, 2009 Compared to Year Ended December 31, 2008

	Year Ended
	December 31,						Dollar			Percent
(dollars in thousands)	2009			2008			Change			Change
Revenue from rental operations and other:
Base rents	$	611,061		$	589,626		$	21,435			3.6	%
Escalations and recoveries from tenants		103,057			108,812			(5,755	)		(5.3	)
Other income		13,538			20,175			(6,637	)		(32.9	)
Total revenues from rental operations		727,656			718,613			9,043			1.3
Property expenses:
Real estate taxes		93,322			87,220			6,102			7.0
Utilities		70,927			83,634			(12,707	)		(15.2	)
Operating services		110,169			106,288			3,881			3.7
Total property expenses		274,418			277,142			(2,724	)		(1.0	)
Non-property revenues:
Construction services		21,910			40,680			(18,770	)		(46.1	)
Real estate services		9,359			13,487			(4,128	)		(30.6	)
Total non-property revenues		31,269			54,167			(22,898	)		(42.3	)
Non-property expenses:
Direct construction costs		20,323			37,649			(17,326	)		(46.0	)
General and administrative		39,779			43,861			(4,082	)		(9.3	)
Depreciation and amortization		200,732			192,957			7,775			4.0
Total non-property expenses		260,834			274,467			(13,633	)		(5.0	)
Operating  income		223,673			221,171			2,502			1.1
Other (expense) income:
Interest expense		(140,068	)		(126,937	)		(13,131	)		(10.3	)
Interest and other investment income		570			1,374			(804	)		(58.5	)
Equity in earnings (loss) of unconsolidated
joint ventures		(5,560	)		(39,752	)		34,192			86.0
Gain on sale of investment in marketable securities		--			471			(471	)		(100.0	)
Gain on reduction of other obligations		1,693			9,063			(7,370	)		(81.3	)
Total other (expense) income		(143,365	)		(155,781	)		12,416			8.0
Income from continuing operations		80,308			65,390			14,918			22.8
Discontinued Operations:
Income (loss) from discontinued operations		(17	)		(511	)		494			96.7
Impairment charge on rental property		(16,563	)		--			(16,563	)		--
Total discontinued operations, net		(16,580	)		(511	)		(16,069	)		(3,144.6	)
Net income		63,728			64,879			(1,151	)		(1.8	)
Noncontrolling interest in consolidated joint
ventures		943			664			279			42.0
Preferred unit distributions		(2,000	)		(2,000	)		--			--
Net income available to common unitholders	$	62,671		$	63,543		$	(872	)		(1.4	)%

52

The following is a summary of the changes in revenue from rental operations and property expenses in 2009 as compared to 2008 divided into Same-Store Properties and Acquired Properties (dollars in thousands):

	Total Company		Same-Store Properties		Acquired Properties
	Dollar	Percent	Dollar	Percent	Dollar	Percent
	Change	Change	Change	Change	Change	Change
Revenue from rental operations:
Base rents	$ 21,435	3.6%	$   (4,951)	(0.9)%	$ 26,386	4.5%
Escalations and recoveries
from tenants	(5,755)	(5.3)	(7,641)	(7.0)	1,886	1.7
Other income	(6,637)	(32.9)	(6,750)	(33.5)	113	0.6
Total	$   9,043	1.3%	$ (19,342)	(2.7)	$ 28,385	4.0%
Property expenses:
Real estate taxes	$   6,102	7.0%	$    2,808	3.2%	$   3,294	3.8%
Utilities	(12,707)	(15.2)	(14,806)	(17.7)	2,099	2.5
Operating services	3,881	3.7	(564)	(0.5)	4,445	4.2
Total	$  (2,724)	(1.0)%	$ (12,562)	(4.5)%	$   9,838	3.5%
OTHER DATA:
Number of Consolidated Properties	267		254		13
Square feet (in thousands)	30,796		29,095		1,701

Base rents for the Same-Store Properties decreased $5.0 million, or 0.9 percent, for 2009 as compared to 2008, due primarily to decreased occupancy.  Escalations and recoveries from tenants for the Same-Store Properties decreased $7.6 million, or 7.0 percent, for 2009 over 2008, due primarily to lower operating and utility expenses in 2009, as compared to 2008.  Other income for the Same-Store Properties decreased $6.8 million, or 33.5 percent, due primarily to a decrease in lease breakage income for 2009 as compared to 2008.

Real estate taxes on the Same-Store Properties increased $2.8 million, or 3.2 percent, for 2009 as compared to 2008, due primarily to real estate tax refunds received in 2008.  Utilities for the Same-Store Properties decreased $14.8 million, or 17.7 percent, for 2009 as compared to 2008, due primarily to lower electric rates and usage in 2009 as compared to 2008. Operating services for the Same-Store Properties decreased $0.6 million, or 0.5 percent, due primarily to a decrease in property insurance, partially offset by an increase in snow removal costs in 2009 as compared to 2008.

Construction services revenue decreased $18.8million, or 46.1 percent, in 2009 as compared to 2008, due to lesser activity in 2009.  Real estate services revenues decreased by $4.1 million, or 30.6percent, for 2009 as compared to 2008, due primarily to decreases in management fee income of $1.8million, salary reimbursements of $1.4million, and commissions income of $0.7million.

Direct construction costs decreased $17.3million, or 46.0percent, in 2009 as compared to 2008, due primarily to lesser activity in 2009.

General and administrative decreased by $4.1million, or 9.3percent, for 2009 as compared to 2008 due primarily to decreases in professional fees and state taxes.

Depreciation and amortization increased by $7.8 million, or 4.0 percent, for 2009 over 2008.  This increase was due primarily to the Acquired Properties.

Interest expense increased $13.1million, or 10.3percent, for 2009 as compared to 2008.  This increase was primarily as a result of higher average interest rates on outstanding debt and capitalizing less interest on development projects in 2009 as compared to 2008.

Interest and other investment income decreased $0.8 million, or 58.5 percent, for 2009 as compared to 2008.  This decrease was due primarily to lower interest rates on invested cash and cash equivalents for 2009 as compared to 2008.

53

Equity in earnings of unconsolidated joint ventures increased $34.2 million, or 86.0 percent, for 2009 as compared to 2008.  The increase was due primarily to the recording of the Company’s share of the venture’s impairment charge in 2008 of $27.1 million in the Mack-Gale-Green/Gramercy venture, and $11.9 million in the Boston-Downtown Crossing joint venture, partially offset by the write-off in 2009 of the Company’s investment in the Route 93 Portfolio venture for an increased loss of $3.2 million in 2009.

The Company had a gain on reduction of other obligations of $1.7 million on account of the expiration of certain assumed obligations in 2009, as compared to a gain on reduction of other obligations of $9.1 million in 2008 due to a change in the Company’s estimates of payables under its remaining assumed lease obligations.

The Company recognized a gain on sale of investments in marketable securities of $0.5 million in 2008.

Income from continuing operations increased to $80.3 million in 2009 from $65.4 million in 2008.  The increase of $14.9 million was due to the factors discussed above.

Net income available to common unitholders decreased by $0.9 million, or 1.4 percent, from approximately $63.6 million in 2008 to $62.7 million in 2009.  The decrease was primarily due to an impairment charge on rental property of $16.6 million in 2009.  This was partially offset by an increase in income from continuing operations of $14.9 million, an increase in income from discontinued operations of $0.5 million for 2009 as compared to 2008, and an increase in noncontrolling interest in consolidated joint ventures of $0.3 million for 2009 as compared to 2008.

54

LIQUIDITY AND CAPITAL RESOURCES

Liquidity

Overview:

Historically, rental revenue has been the Company’s principal source of funds to pay operating expenses, debt service, capital expenditures and distributions, excluding non-recurring capital expenditures.  To the extent that the Company’s cash flow from operating activities is insufficient to finance its non-recurring capital expenditures such as property acquisitions, development and construction costs and other capital expenditures, the Company and Corporation have and expect to continue to finance such activities through borrowings under the Company’s revolving credit facility and other debt and equity financings.

The Company believes that with the general downturn in the Company’s markets in recent years, it is reasonably likely that vacancy rates may continue to increase, effective rental rates on new and renewed leases may continue to decrease and tenant installation costs, including concessions, may continue to increase in most or all of its markets in 2011 and possibly beyond.  As a result of the potential negative effects on the Company’s revenue from the overall reduced demand for office space, the Company’s cash flow could be insufficient to cover increased tenant installation costs over the short-term.  If this situation were to occur, the Company expects that it would finance any shortfalls through borrowings under its revolving credit facility and other debt securities by the Company and equity fi nancings by the Corporation.

The Company expects to meet its short-term liquidity requirements generally through its working capital, net cash provided by operating activities and from its revolving credit facility.  The Company frequently examines potential property acquisitions and development projects and, at any given time, one or more of such acquisitions or development projects may be under consideration.  Accordingly, the ability to fund property acquisitions and development projects is a major part of the Company’s financing requirements.  The Company expects to meet its financing requirements through funds generated from operating activities, to the extent available, proceeds from property sales, long-term and short-term borrowings (including draws on the Company’s revolving credit facility) and the issuance of ad ditional debt securities by the Company and/or equity securities by the Corporation.

If current economic conditions persist or deteriorate, the Company may experience increases in past due accounts, defaults, lower occupancy rates and reduced effective rents.  This condition would negatively affect the Company’s future net income and cash flows and could have a material adverse effect on the Company’s financial condition and its ability to continue distributions at current levels.

Construction Projects and Other:

Sanofi-Aventis U.S. Inc. (“Sanofi”), which occupies neighboring buildings in Bridgewater, New Jersey, exercised its option to cause the Company to construct a building on its vacant, developable land and has signed a lease for the building.  The lease has a term of 15 years, subject to three five-year extension options.  The construction of the 205,000 square foot building commenced in 2009 and was delivered to the tenant in January 2011.  The total estimated costs of the project are expected to be approximately $50.9 million (of which the Company has incurred $38.0 million through December 31, 2010.)

REIT Restrictions:

To maintain its qualification as a REIT under the Code, the Corporation must make annual distributions to its stockholders of at least 90 percent of its REIT taxable income, determined without regard to the dividends paid deduction and by excluding net capital gains.  Moreover, the Corporation intends to continue to make regular quarterly dividends to its common stockholders.  Based upon the most recently paid quarterly common dividend of $0.45 per common share, in the aggregate, such distributions would equal approximately $143.3 million ($166.7 million, including common units in the Company, held by parties other than the Corporation) on an annualized basis.  However, any such distribution, whether for federal income tax purposes or otherwise, would be paid out of (a) available cash, including borrowings and other sources, after meeting operating requirements, preferred stock dividends and distributions, and scheduled debt service on the Company’s debt, and (b) for distributions declared on or before December 31, 2012 with respect to a taxable year ending on or before December 31, 2011, the Corporation’s stock, as permitted pursuant to Internal Revenue Service Revenue Procedure 2010-12, 2010-3 I.R.B. Under this Revenue Procedure, the Corporation is permitted to make taxable distributions of its stock (in lieu of cash) if (x) any such distribution is declared on or before December 31, 2012 with respect to a taxable year ending on or before December 31, 2011, and (y) each of its stockholders is permitted to elect to receive its entire entitlement under such declaration in either cash or shares of equivalent value subject to a limitation in the amount of cash to be distributed in the aggregate; provided that (i) the amount of cash that is set aside for distribution is not less than 10 percent of the aggregate distribution so declared, and (ii) if too many of its stockholders elect to receive cash, a pro rata amount of cash will be distributed to each such stockholder electing to receive cash, but in no event will any such stockholder receive less than its entire entitlement under such declaration.

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Property Lock-Ups:

The Company may not dispose of or distribute certain of its properties, currently comprising seven properties with an aggregate net book value of approximately $133.9 million, which were originally contributed by certain unrelated common unitholders of the Company, without the express written consent of such common unitholders, as applicable, except in a manner which does not result in recognition of any built-in-gain (which may result in an income tax liability) or which reimburses the appropriate specific common unitholders for the tax consequences of the recognition of such built-in-gains (collectively, the “Property Lock-Ups”).  The aforementioned restrictions do not apply in the event that the Company sells all of its properties or in connection with a sale transaction which the Corporation’s Board of D irectors determines is reasonably necessary to satisfy a material monetary default on any unsecured debt, judgment or liability of the Company or to cure any material monetary default on any mortgage secured by a property.  The Property Lock-Ups expire periodically through 2016.  Upon the expiration of the Property Lock-Ups, the Company is generally required to use commercially reasonable efforts to prevent any sale, transfer or other disposition of the subject properties from resulting in the recognition of built-in gain to the specific common unitholders, which include members of the Mack Group (which includes William L. Mack, Chairman of the Corporation’s Board of Directors; David S. Mack, director of the Corporation; Earle I. Mack, a former director of the Corporation; and Mitchell E. Hersh, president, chief executive officer and director of the Corporation), the Robert Martin Group (which includes Robert F. Weinberg, director of the Corporation; Martin S. Berger, a former director of the Corporation; and Timothy M. Jones, former president of the Corporation), the Cali Group (which includes John R. Cali, director of the Corporation, and John J. Cali, a former director of the Corporation).  As of December 31, 2010, 130 of the Company’s properties, with an aggregate net book value of approximately $1.8 billion, have lapsed restrictions and are subject to these conditions.

Unencumbered Properties:

As of December 31, 2010, the Company had 236 unencumbered properties, totaling 24.3 million square feet, representing 78.5 percent of the Company’s total portfolio on a square footage basis.

Cash Flows

Cash and cash equivalents decreased by $269.2 million to $21.8 million at December 31, 2010, compared to $291.0 million at December 31, 2009.  This decrease is comprised of the following net cash flow items:

(1)   $223.0 million provided by operating activities.

(2)   $89.0 million used in investing activities, consisting primarily of the following:

(a)   $92.5 million used for additions to rental property; plus

(b)   $1.0 million used for investments in unconsolidated joint ventures; minus

(c)   $2.4 million received from distributions in excess of cumulative earnings from unconsolidated joint ventures; minus

(d)   $2.0 million received from restricted cash.

(3)   $403.2million used in financing activities, consisting primarily of the following:

(a)   $465.0million used for repayment of senior unsecured notes; plus

(b)   $168.5million used for payments of dividends and distributions; plus

(c)   $22.0million used for repayments of borrowings under the Company’s unsecured credit facility; plus

(d)   $8.2million used for repayments of mortgages, loans payable and other obligation; plus.

(e)   $2.1 million used for payments of financing costs; minus.

(f)   $250.0 million from borrowings under the revolving credit facility; minus

(g)   $11.0million from proceeds received from mortgages and loans payable; minus

(h)   $1.5million from proceeds received from stock options exercised.

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Debt Financing

Summary of Debt:

The following is a breakdown of the Company’s debt between fixed and variable-rate financing as of December 31, 2010.

	Balance		Weighted Average	Weighted Average Maturity
	($000’s)	% of Total	Interest Rate (a)	in Years
Fixed Rate Unsecured Debt and
Other Obligations	$1,118,451	53.53%	6.08%	4.45
Fixed Rate Secured Debt	732,043	35.03%	7.44%	6.54
Variable Rate Secured Debt	11,000	0.53%	2.26%	1.00
Variable Rate Unsecured Debt	228,000	10.91%	0.83%	1.48
Totals/Weighted Average:	$2,089,494	100.00%	5.97%	4.84

(a) Actual weighted average LIBOR contract rates relating to the Company’s outstanding debt as of December 31, 2010 of 0.28 percent was used in calculating revolving credit facility and other variable rate debt interest rates.

Debt Maturities:

Scheduled principal payments and related weighted average annual interest rates for the Company’s debt as of December 31, 2010 are as follows:

	Scheduled	Principal		Weighted Avg.
	Amortization	Maturities	Total	Interest Rate of
Period	($000’s)	($000’s)	($000’s)	Future Repayments (a)
2011	$   9,217	$     11,000	$     20,217	4.75%
2012	10,687	438,148	448,835	3.48%
2013	11,319	145,223	156,542	5.39%
2014	10,473	335,257	345,730	6.82%
2015	8,946	150,000	158,946	5.40%
Thereafter	35,820	952,532	988,352	7.15%
Sub-total	86,462	2,032,160	2,118,622
Adjustment for unamortized debt
discount/premium and
mark-to-market, net, as of
December 31, 2010	(29,128)	--	(29,128)
Totals/Weighted Average	$ 57,334	$2,032,160	$2,089,494	5.97%
(a)  Actual weighted average LIBOR contract rates relating to the Company’s outstanding debt as of December 31, 2010 of 0.28 percent was used in calculating revolving credit facility and other variable rate debt interest rates.

Senior Unsecured Notes:

On December 15, 2010, the Company redeemed $300 million principal amount of its 7.75 percent senior unsecured notes due February 15, 2011.  The redemption price, including a make-whole premium, was 101.225 percent of the principal amount of the notes, plus accrued and unpaid interest up to the redemption date.  The Company funded the redemption price, including accrued and unpaid interest, of approximately $311.4 million from borrowing on its unsecured revolving credit facility, as well as cash on hand.  In connection with the redemption, the Company recorded approximately $3.8 million as a loss from early extinguishment of debt.

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The terms of the Company’s senior unsecured notes (which totaled approximately $1.1 billion as of December 31, 2010) include certain restrictions and covenants which require compliance with financial ratios relating to the maximum amount of debt leverage, the maximum amount of secured indebtedness, the minimum amount of debt service coverage and the maximum amount of unsecured debt as a percent of unsecured assets.

Unsecured Revolving Credit Facility:

The Company has an unsecured revolving credit facility with a borrowing capacity of $775 million (expandable to $800 million). The interest rate on outstanding borrowings (not electing the Company’s competitive bid feature) is LIBOR plus 55 basis points at the BBB/Baa2 pricing level.  In June 2010, the Company exercised its option to extend the credit facility for one year to June 2012 and paid the $1,162,500 extension fee.  As of February 8, 2011, the Company had $247 million of outstanding borrowings under its unsecured revolving credit facility.

The facility has a competitive bid feature, which allows the Company to solicit bids from lenders under the facility to borrow up to $300 million at interest rates less than the current LIBOR plus 55 basis point spread.  The Company may also elect an interest rate representing the higher of the lender’s prime rate or the Federal Funds rate plus 50 basis points. The unsecured facility also requires a 15 basis point facility fee on the current borrowing capacity payable quarterly in arrears.

The interest rate and the facility fee are subject to adjustment, on a sliding scale, based upon the Company’s unsecured debt ratings.  In the event of a change in the Company’s unsecured debt rating, the interest and facility fee rates will be adjusted in accordance with the following table:

Company’s	Interest Rate –
Unsecured Debt Ratings:	Applicable Basis Points	Facility Fee
S&P Moody’s/Fitch (a)	Above LIBOR	Basis Points
No ratings or less than BBB-/Baa3/BBB-	100.0	25.0
BBB-/Baa3/BBB-	75.0	20.0
BBB/Baa2/BBB (current)	55.0	15.0
BBB+/Baa1/BBB+	42.5	15.0
A-/A3/A- or higher	37.5	12.5
(a)    If the Company has debt ratings from two rating agencies, one of which is Standard & Poor’s Rating Services (“S&P”) or Moody’s Investors Service (“Moody’s”), the rates per the above table shall be based on the lower of such ratings.  If the Company has debt ratings from three rating agencies, one of which is S&P or Moody’s, the rates per the above table shall be based on the lower of the two highest ratings.  If the Company has debt ratings from only one agency, it will be considered to have no rating or less than BBB-/Baa3/BBB- per the above table.

The terms of the unsecured facility include certain restrictions and covenants which limit, among other things, the payment of dividends (as discussed below), the incurrence of additional indebtedness, the incurrence of liens and the disposition of real estate properties (to the extent that: (i) such property dispositions cause the Company to default on any of the financial ratios of the facility described below; or (ii) the property dispositions are completed while the Company is under an event of default under the facility, unless, under certain circumstances, such disposition is being carried out to cure such default), and which require compliance with financial ratios relating to the maximum leverage ratio, the maximum amount of secured indebtedness, the minimum amount of tangible net worth, the minimum amount of fixed charge cover age, the maximum amount of unsecured indebtedness, the minimum amount of unencumbered property interest coverage and certain investment limitations.  The dividend restriction referred to above provides that, if an event of default has occurred and is continuing, the Corporation will not make any excess distributions with respect to common stock or other common equity interests except to enable the Corporation to continue to qualify as a REIT under the Code.

The lending group for the credit facility consists of: JPMorgan Chase Bank, N.A., as administrative agent (the “Agent”); Bank of America, N.A., assyndication agent; Scotiabanc, Inc., Wachovia Bank, National Association, and Wells Fargo Bank, National Association, as documentation agents; SunTrust Bank, as senior managing agent; US Bank National Association, Citicorp North America, Inc. and PNC Bank, National Association, as managing agents; and Bank of China, New York Branch, The Bank of New York; Chevy Chase Bank, F.S.B., The Royal Bank of Scotland PLC, Mizuho Corporate Bank, Ltd., The Bank of Tokyo-Mitsubishi UFJ, Ltd. (successor by merger to UFJ Bank Limited), North Fork Bank, Bank Hapoalim B.M., Comeri ca Bank, Chang Hwa Commercial Bank, Ltd., New York Branch, First Commercial Bank, New York Agency, Mega International Commercial Bank Co. Ltd., New York Branch, Deutsche Bank Trust Company Americas and Hua Nan Commercial Bank, New York Agency, as participants.

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Money Market Loan:

The Company entered into an agreement with JPMorgan Chase Bank to participate in a noncommitted money market loan program (“Money Market Loan”).  The Money Market Loan is an unsecured borrowing of up to $75 million arranged by JPMorgan Chase Bank (“the lender”) with maturities of 30 days or less.  The rate of interest on the Money Market Loan borrowing is set at the time of each borrowing.  As of December 31, 2010, the Company had no outstanding borrowings under its Money Market Loan program.

Mortgages, Loans Payable and Other Obligations:

The Company has mortgages, loans payable and other obligations which consist of various loans collateralized by certain of the Company’s rental properties.  Payments on mortgages, loans payable and other obligations are generally due in monthly installments of principal and interest, or interest only.

On January 15, 2010, the Company refinanced its $150 million secured loan with The Prudential Insurance Company of America.  The new loan also includes VPCM, LLC, a wholly-owned subsidiary of the Virginia Retirement System, as co-lender.  The mortgage loan, which is collateralized by seven properties, is for a seven-year term at an effective interest rate of 6.33 percent.

Debt Strategy:

The Company does not intend to reserve funds to retire the Company’s senior unsecured notes, borrowings under its unsecured revolving credit facility, or its mortgages, loans payable and other obligations upon maturity.  Instead, the Corporation or Company will seek to refinance such debt at maturity or retire such debt through the issuance of additional equity or debt securities on or before the applicable maturity dates.  If it cannot raise sufficient proceeds to retire the maturing debt, the Company may draw on its revolving credit facility to retire the maturing indebtedness, which would reduce the future availability of funds under such facility.  As of February 8, 2011, the Company had $247 million of outstanding borrowings under its $775 million unsecured revolving credit facili ty and no outstanding borrowings under the Money Market Loan.  The Company is reviewing various refinancing options, including the purchase of its senior unsecured notes in privately-negotiated transactions, the issuance of additional, or exchange of current, unsecured debt, common and preferred stock, and/or obtaining additional mortgage debt, some or all of which may be completed during 2011.  The Company currently anticipates that its available cash and cash equivalents and cash flows from operating activities, together with cash available from borrowings and other sources, will be adequate to meet the Company’s capital and liquidity needs in the short term.  However, if these sources of funds are insufficient or unavailable, due to current economic conditions or otherwise, the Corporation’s ability to make the expected distributions discussed in “REIT Restrictions” above may be adversely affected.

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Equity Financing and Registration Statements

Common Equity:

The following table presents the changes in the Corporation’s issued and outstanding shares of Common Stock and the Company’s common units from December 31, 2009 to December 31, 2010:

	Common	Common
	Stock	Units	Total
Outstanding at December 31, 2009	78,969,752	13,495,036	92,464,788
Stock options exercised	55,508		55,508
Common units redeemed for Common Stock	487,368	(487,368)	--
Shares issued under Dividend Reinvestment
and Stock Purchase Plan	5,197		5,197
Restricted shares issued, net of cancellations	87,649		87,649
Outstanding at December 31, 2010	79,605,474	13,007,668	92,613,142

Share Repurchase Program:

The Corporation has a share repurchase program which was authorized by its Board of Directors in September 2007 to purchase up to $150 million of the Corporation’s outstanding common stock (“Repurchase Program”), which it may repurchase from time to time in open market transactions at prevailing prices or through privately negotiated transactions. As of December 31, 2010, the Corporation has a remaining authorization under the Repurchase Program of $46 million. Concurrent with any repurchases of common stock by the Corporation, the Corporation sells to the Company an equal number of common units.

Dividend Reinvestment and Stock Purchase Plan:

The Corporation has a Dividend Reinvestment and Stock Purchase Plan (the “DRIP”) which commenced in March 1999 under which 5.5 million shares of the Corporation’s common stock have been reserved for future issuance.  The DRIP provides for automatic reinvestment of all or a portion of a participant’s dividends from the Corporation’s shares of common stock.  The DRIP also permits participants to make optional cash investments up to $5,000 a month without restriction and, if the Corporation waives this limit, for additional amounts subject to certain restrictions and other conditions set forth in the DRIP prospectus filed as part of the Corporation’s effective registration statement on Form S-3 filed with the Securities and Exchange Commission (“SEC”) for the 5.5 million shares of the Corporation’s common stock reserved for issuance under the DRIP.

Shelf Registration Statements:

The Corporation has an effective shelf registration statement on Form S-3 filed with the SEC for an aggregate amount of $2.0 billion in common stock, preferred stock, depositary shares, and/or warrants of the Corporation, under which $287.5 million of securities have been sold through February 8, 2011 and $1.7 billion remains available for future issuances.

The Corporation and the Company also have an effective shelf registration statement on Form S-3 filed with the SEC for an aggregate amount of $2.5 billion in common stock, preferred stock, depositary shares and guarantees of the Corporation and debt securities of the Company, under which $250 million of securities have been sold as of February 8, 2011 and $2.25 billion remains available for future issuances.

Off-Balance Sheet Arrangements

Unconsolidated Joint Venture Debt:

The debt of the Company’s unconsolidated joint ventures are generally non-recourse to the Company except for customary exceptions pertaining to such matters as intentional misuse of funds, environmental conditions and material misrepresentations.  The Company has also posted a $5.9 million letter of credit in support of the Harborside South Pier joint venture, half of which is indemnified by Hyatt Corporation, the Company’s joint venture partner.

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The Company’s off-balance sheet arrangements are further discussed in Note 4: Investments in Unconsolidated Joint Ventures to the Financial Statements.

Contractual Obligations

The following table outlines the timing of payment requirements related to the Company’s debt (principal and interest), PILOT agreements, ground lease and other agreements as of December 31, 2010:

	Payments Due by Period
		Less than 1	1 – 3	4 – 5	6 – 10	After 10
(dollars in thousands)	Total	Year	Years	Years	Years	Years
Senior unsecured notes	1,490,985	77,744	438,785	441,156	533,300	--
Revolving credit facility	228,000	--	228,000	--	--	--
Mortgages, loans payable
and other obligations	1,074,079	69,613	150,848	232,185	621,433	--
Payments in lieu of taxes
(PILOT)	50,160	4,407	13,222	8,815	22,037	1,679
Ground lease payments	18,519	375	1,085	743	1,197	15,119
Total	2,861,743	152,139	831,940	682,899	1,177,967	16,798

Inflation

The Company’s leases with the majority of its tenants provide for recoveries and escalation charges based upon the tenant’s proportionate share of, and/or increases in, real estate taxes and certain operating costs, which reduce the Company’s exposure to increases in operating costs resulting from inflation.

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

We consider portions of this information, including the documents incorporated by reference, to be forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended.  We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of such act.  Such forward-looking statements relate to, without limitation, our future economic performance, plans and objectives for future operations and projections of revenue and other financial items.  Forward-looking statements can be identified by the use of words such as “may,” “will,” “plan,” “should,” “expect,” “anticipate,” “estimate,” “continue” or co mparable terminology.  Forward-looking statements are inherently subject to risks and uncertainties, many of which we cannot predict with accuracy and some of which we might not even anticipate.  Although we believe that the expectations reflected in such forward-looking statements are based upon reasonable assumptions at the time made, we can give no assurance that such expectations will be achieved.  Future events and actual results, financial and otherwise, may differ materially from the results discussed in the forward-looking statements.  Readers are cautioned not to place undue reliance on these forward-looking statements.

Among the factors about which we have made assumptions are:

·   risks and uncertainties affecting the general economic climate and conditions, including the impact of the general economic recession as it impacts the national and local economies, which in turn may have a negative effect on the fundamentals of our business and the financial condition of our tenants;

·   the value of our real estate assets, which may limit our ability to dispose of assets at attractive prices or obtain or maintain debt financing secured by our properties or on an unsecured basis;

·   the extent of any tenant bankruptcies or of any early lease terminations;

·   our ability to lease or re-lease space at current or anticipated rents;

·   changes in the supply of and demand for office, office/flex and industrial/warehouse properties;

·   changes in interest rate levels and volatility in the securities markets;

·   changes in operating costs;

·   our ability to obtain adequate insurance, including coverage for terrorist acts;

·   the availability of financing on attractive terms or at all, which may adversely impact our ability to pursue acquisition and development opportunities and refinance existing debt and our future interest expense;

·   changes in governmental regulation, tax rates and similar matters; and

·   other risks associated with the development and acquisition of properties, including risks that the development may not be completed on schedule, that the tenants will not take occupancy or pay rent, or that development or operating costs may be greater than anticipated.

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For further information on factors which could impact us and the statements contained herein, see Item 1A: Risk Factors. We assume no obligation to update and supplement forward-looking statements that become untrue because of subsequent events, new information or otherwise.

ITEM 7A.        QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk is the exposure to loss resulting from changes in interest rates, foreign currency exchange rates, commodity prices and equity prices.  In pursuing its business plan, the primary market risk to which the Company is exposed is interest rate risk.  Changes in the general level of interest rates prevailing in the financial markets may affect the spread between the Company’s yield on invested assets and cost of funds and, in turn, its ability to make distributions or payments to its investors.

Approximately $1.9 billion of the Company’s long-term debt as of December 31, 2010 bears interest at fixed rates and therefore the fair value of these instruments is affected by changes in market interest rates.  The following table presents principal cash flows (in thousands) based upon maturity dates of the debt obligations and the related weighted-average interest rates by expected maturity dates for the fixed rate debt.  The interest rates on the Company’s variable rate debt as of December 31, 2010 ranged from LIBOR plus 55 basis points to LIBOR plus 200 basis points.  If market rates of interest on the Company’s variable rate debt increased or decreased by 10 percent, then the increase or decrease in interest costs on the Company’s variable rate debt would be approximately $0.2 million annually.

December 31, 2010
Debt,										Fair
including current portion ($’s in thousands)	2011	2012	2013	2014	2015	Thereafter	Sub-total	Other (a)	Total	Value
Fixed Rate	$9,217	$220,835	$156,542	$345,730	$158,946	$988,352	$1,879,622	$(29,128)	$1,850,494	$1,962,249
Average Interest Rate	7.71%	6.21%	5.39%	6.82%	5.40%	7.15%			6.62%
Variable Rate	$11,000	$228,000							$   239,000	$   233,300

(a)      Adjustment for unamortized debt discount/premium and mark-to-market, net, as of December 31, 2010.

While the Company has not experienced any significant credit losses, in the event of a significant rising interest rate environment and/or economic downturn, defaults could increase and result in losses to the Company which could adversely affect its operating results and liquidity.

ITEM 8.        FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The Consolidated Financial Statements of the Company and the Report of PricewaterhouseCoopers LLP, together with the notes to the Consolidated Financial Statements of the Company, and the Consolidated Financial Statements of Mack-Green-Gale LLC and the Report of the Cornerstone Accounting Group LLP, together with the notes to the Consolidated Financial Statements of Mack-Green-Gale LLC, each as set forth in the index in Item 15: Exhibits and Financial Statements are filed under this Item 8: Financial Statements and Supplementary Data and are incorporated herein by reference.

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ITEM 9.          CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING

AND FINANCIAL DISCLOSURE

None.

ITEM 9A.       CONTROLS AND PROCEDURES

Disclosure Controls and Procedures. The Corporation’s management, with the participation of the Corporation’s chief executive officer and chief financial officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on such evaluation, the Corporation’s chief executive officer and chief financial officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures were effective in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act.

Management’s Report on Internal Control Over Financial Reporting. Internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, is a process designed by, or under the supervision of, the Corporation’s chief executive officer and chief financial officer, or persons performing similar functions, and effected by the Corporation’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting p rinciples.  The Corporation’s management, with the participation of the Corporation’s chief executive officer and chief financial officer, has established and maintained policies and procedures designed to maintain the adequacy of the Company’s internal control over financial reporting, and includes those policies and procedures that:

(1) Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company;

(2) Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Corporation; and

(3) Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

The Corporation’s management has evaluated the effectiveness of the Company’s internal control over financial reporting as of December 31, 2010 based on the criteria established in a report entitled Internal Control—Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).  Based on our assessment and those criteria, the Corporation’s management has concluded that the Company’s internal control over financial reporting was effective as of December 31, 2010.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree or compliance with the policies or procedures may deteriorate.

The effectiveness of the Company’s internal control over financial reporting as of December 31, 2010 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which appears herein.

Changes In Internal Control Over Financial Reporting.  There have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fourth fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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ITEM 9B.       OTHER INFORMATION

Not Applicable.

PART III

ITEM 10.       DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by Item 10 will be set forth in the Corporation’s definitive proxy statement for its annual meeting of shareholders expected to be held on May 24, 2011, and is incorporated herein by reference.

ITEM 11.       EXECUTIVE COMPENSATION

The information required by Item 11 will be set forth in the Corporation’s definitive proxy statement for its annual meeting of shareholders expected to be held on May 24, 2011, and is incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information required by Item 12 will be set forth in the Corporation’s definitive proxy statement for its annual meeting of shareholders expected to be held on May 24, 2011, and is incorporated herein by reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by Item 13 will be set forth in the Corporation’s definitive proxy statement for its annual meeting of shareholders expected to be held on May 24, 2011, and is incorporated herein by reference.

ITEM 14.       PRINCIPAL ACCOUNTING FEES AND SERVICES

The information required by Item 14 will be set forth in the Corporation’s definitive proxy statement for its annual meeting of shareholders expected to be held on May 24, 2011, and is incorporated herein by reference.

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PART IV

ITEM 15.       EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) 1. All Financial Statements

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheets as of December 31, 2010 and 2009

Consolidated Statements of Operations for the Years Ended December 31, 2010, 2009 and 2008

Consolidated Statements of Changes in Equity for the Years Ended December 31, 2010, 2009 and 2008

Consolidated Statements of Cash Flows for the Years Ended December 31, 2010, 2009 and 2008

Notes to Consolidated Financial Statements

(a) 2.       Financial Statement Schedules

(i)         Mack-Cali Realty Corporation:

Schedule III – Real Estate Investments and Accumulated Depreciation as of December 31, 2010

All other schedules are omitted because they are not required or the required information is shown in the financial statements or notes thereto.

(ii)   Mack-Green-Gale LLC:

Mack-Green-Gale LLC met the conditions of a significant subsidiary under Rule 1-02(w) of Regulation S-X for the fiscal year ended December 31, 2008 and was consolidated by the Company as of April 29, 2009. The following financial statements of Mack-Green-Gale LLC for the periods indicated are being filed pursuant to Rule 3-09 of Regulation S-X.

Mack-Green-Gale LLC and Subsidiaries Consolidated Balance Sheets at December 31, 2008 and 2007 and Consolidated Statements of Operations, Changes in Members' Capital and Cash Flows for the years ended December 31, 2008 and 2007 and for the period from May 9, 2006 (Commencement of Operations) through December 31, 2006, including the report of independent registered public accounting firm (filed as Exhibit 99.1 to this Annual Report on Form 10-K)

Mack-Green-Gale LLC and Subsidiaries Consolidated Balance Sheet at April 28, 2009 and Consolidated Statements of Operations, Changes in Members' Capital and Cash Flows for the period January 1, 2009 through April 28, 2009 (Date of Consolidation) (unaudited) (filed as Exhibit 99.2 to this Annual Report on Form 10-K)

All other schedules are omitted because they are not required or the required information is shown in the financial statements or notes thereto.

(a) 3.       Exhibits

The exhibits required by this item are set forth on the Exhibit Index attached hereto.

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Report of Independent Registered Public Accounting Firm

To the Partners

of Mack-Cali Realty, L.P.:

In our opinion, the consolidated financial statements listed in the index appearing under Item 15(a)(1) present fairly, in all material respects, the financial position of Mack-Cali Realty, L.P. and its subsidiaries (collectively, the “Operating Partnership”) at December 31, 2010 and 2009, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2010 in conformity with accounting principles generally accepted in the United States of America.  In addition, in our opinion, the financial statement schedule listed in the index appearing under Item 15(a)(2)(i)presents fairly, in all material respects, the information set forth therein when read in conjunction with t he related consolidated financial statements.  Also in our opinion, the Operating Partnership maintained, in all material respects, effective internal control over financial reporting as of December 31, 2010, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).  The Operating Partnership’s management is responsible for these financial statements and financial statement schedule, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Controls Over Financial Reporting appearing under Item 9A.  Our responsibility is to express opinions on these financial statements, on the financial statement schedule, and on the Operating Partnership’s internal control over financial reporting based on our integrated audits.  We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects.  Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation.  Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design an d operating effectiveness of internal control based on the assessed risk.  Our audits also included performing such other procedures as we considered necessary in the circumstances.  We believe that our audits provide a reasonable basis for our opinions.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.  A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

New York, New York

February 9, 2011

66

MACK-CALI REALTY, L.P. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (in thousands, except per unit amounts)

	December 31,
ASSETS	2010			2009
Rental property
Land and leasehold interests	$	771,960		$	771,794
Buildings and improvements		3,970,177			3,948,509
Tenant improvements		470,098			456,547
Furniture, fixtures and equipment		4,485			9,358
		5,216,720			5,186,208
Less – accumulated depreciation and amortization		(1,278,985	)		(1,153,223	)
Net investment in rental property		3,937,735			4,032,985
Cash and cash equivalents		21,851			291,059
Investments in unconsolidated joint ventures		34,220			35,680
Unbilled rents receivable, net		126,917			119,469
Deferred charges and other assets, net		212,038			213,674
Restricted cash		17,310			20,681
Accounts receivable, net of allowance for doubtful accounts
of $2,790 and $2,036		12,395			8,089
Total assets	$	4,362,466		$	4,721,637
LIABILITIES AND EQUITY
Senior unsecured notes	$	1,118,451		$	1,582,434
Revolving credit facility		228,000			--
Mortgages, loans payable and other obligations		743,043			755,003
Dividends and distributions payable		42,176			42,109
Accounts payable, accrued expenses and other liabilities		101,944			106,878
Rents received in advance and security deposits		57,877			54,693
Accrued interest payable		27,038			37,330
Total liabilities		2,318,529			2,578,447
Commitments and contingencies
Partners’ Capital:
General Partner 10,000 and 10,000 preferred units outstanding		24,836			24,836
General Partner 79,605,474 and 78,969,752 common units outstanding		1,667,450			1,740,326
Limited partners, 13,007,668 and 13,495,036 common units outstanding		349,205			374,999
Total Mack-Cali Realty, L.P. partners’ capital		2,041,491			2,140,161
Noncontrolling interests in consolidated joint ventures:		2,446			3,029
Total equity		2,043,937			2,143,190
Total liabilities and equity	$	4,362,466		$	4,721,637
The accompanying notes are an integral part of these consolidated financial statements.

67

MACK-CALI REALTY, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per unit amounts)

	Year Ended December 31,
REVENUES	2010			2009			2008
Base rents	$	602,357		$	611,061		$	589,626
Escalations and recoveries from tenants		101,699			103,057			108,812
Construction services		62,997			21,910			40,680
Real estate services		7,874			9,359			13,487
Other income		12,553			13,538			20,175
Total revenues		787,480			758,925			772,780
EXPENSES
Real estate taxes		93,535			93,322			87,220
Utilities		74,077			70,927			83,634
Operating services		114,452			110,169			106,288
Direct construction costs		60,255			20,323			37,649
General and administrative		35,003			39,779			43,861
Depreciation and amortization		191,168			200,732			192,957
Impairment charge on rental property		9,521			--			--
Total expenses		578,011			535,252			551,609
Operating income		209,469			223,673			221,171
OTHER (EXPENSE) INCOME
Interest expense		(149,329	)		(140,068	)		(126,937	)
Interest and other investment income		86			570			1,374
Equity in earnings (loss) of unconsolidated joint ventures		2,276			(5,560	)		(39,752	)
Loss from early extinguishment of debt		(3,752	)		--			--
Gain on reduction of other obligations		--			1,693			9,063
Gain on sale of investment in marketable securities		--			--			471
Total other (expense) income		(150,719	)		(143,365	)		(155,781	)
Income from continuing operations		58,750			80,308			65,390
Discontinued operations:
Income (loss) from discontinued operations		242			(17	)		(511	)
Impairment charge on rental property		--			(16,563	)		--
Realized gains (losses) and unrealized losses
on disposition of rental property, net		4,447			--			--
Total discontinued operations, net		4,689			(16,580	)		(511	)
Net income		63,439			63,728			64,879
Noncontrolling interest in consolidated joint ventures		262			943			664
Preferred unit distributions		(2,000	)		(2,000	)		(2,000	)
Net income available to common unitholders	$	61,701		$	62,671		$	63,543
Basic earnings per common unit:
Income from continuing operations	$	0.62		$	0.90		$	0.79
Discontinued operations		0.05			(0.19	)		--
Net income available to common unitholders	$	0.67		$	0.71		$	0.79
Diluted earnings per common unit:
Income from continuing operations	$	0.62		$	0.90		$	0.79
Discontinued operations		0.05			(0.19	)		--
Net income available to common unitholders	$	0.67		$	0.71		$	0.79
Basic weighted average units outstanding		92,373			88,346			80,404
Diluted weighted average units outstanding		92,477			88,389			80,648
The accompanying notes are an integral part of these consolidated financial statements.

68

MACK-CALI REALTY, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (in thousands)

	General	General	Limited	General	General	Limited	Accumulated	Noncontrolling
	Partner	Partner	Partners	Partner	Partner	Partners	Other	Interest in
	Preferred	Common	Common	Preferred	Common	Common	Comprehensive	Consolidated	Total	Comprehensive
	Units	Units	Units	Unitholders	Unitholders	Unitholders	Income (Loss)	Joint Ventures	Equity	Income
Balance at January 1, 2008	10	65,558	14,985	$24,836	$1,617,766	$456,436	$  (47)	$1,414	$2,100,405	$134,276
Net income	--	--	--	2,000	51,726	11,817	--	(664)	64,879	64,879
Distributions	--	--	--	(2,000)	(168,792)	(37,891)	--	--	(208,683)	--
Increase in noncontrolling
interests	--	--	--	--	--	--	--	36	36	--
Redemption of limited partners
common units for shares of
general partners common units	--	547	(547)	--	16,248	(16,248)	--	--	--	--
Units issued under Dividend
Reinvestment and Stock
Purchase Plan	--	10	--	--	319	--	--	--	319	--
Contributions – proceeds from
stock options exercised	--	82	--	--	2,311	--	--	--	2,311	--
Comprehensive Gain:							--	--
Unrealized holding loss
on marketable securities
available for sale	--	--	--	--	--	--	518	--	518	518
Repurchase of general partner										--
Common units	--	(151)	--	--	(5,198)	--	--	--	(5,198)
Stock compensation	--	373	--	--	5,247	--	--		5,247	--
Reclassification adjustments
for realized gain (loss) included
in net income	--	--	--	--	--	--	(471)	--	(471)	(471)
Balance at December 31, 2008	10	66,419	14,438	$24,836	$1,519,627	$414,114	--	$ 786	$1,959,363	$  64,926
Net income	--	--	--	2,000	52,568	10,103	--	(943)	63,728	63,728
Distributions	--	--	--	(2,000)	(136,028)	(25,100)	--	--	(163,128)	--
General partner common
common unit offering	--	11,500	--	--	274,826	--	--	---	274,826	--
Increase in noncontrolling
interests	--	--	--	--	--	--	--	3,186	3,186	--
Redemption of limited partners
common units for shares of
general partners common units	--	943	(943)	--	24,118	(24,118)	--	--	--	--
Units issued under Dividend
Reinvestment and Stock
Purchase Plan	--	9	--	--	207	--	--	--	207	--
Contributions – proceeds from
stock options exercised	--	19	--	--	504	--	--	--	504	--
Stock compensation	--	80	--	--	4,504	--	--	--	4,504	--
Balance at December 31, 2009	10	78,970	13,495	$24,836	$1,740,326	$ 374,999	--	$3,029	$2,143,190	$  63,728
Net income	--	--	--	2,000	52,900	8,801	--	(262)	63,439	63,439
Distributions	--	--	--	(2,000)	(143,018)	(23,543)	--	--	(168,561)	--
Decrease in noncontrolling
interests	--	--	--	--	--	--	--	(321)	(321)	--
Redemption of limited partners
common units for shares of
general partners common units	--	487	(487)	--	11,052	(11,052)	--	--	--	--
Units issued under Dividend
Reinvestment and Stock
Purchase Plan	--	5	--	--	158	--	--	--	158	--
Contributions – proceeds from
stock options exercised	--	55	--	--	1,504	--	--	--	1,504	--
Stock compensation	--	88	--	--	4,528	--	--	--	4,528	--
Balance at December 31, 2009	10	79,605	13,008	$24,836	$1,667,450	$349,205	--	$   2,446	$2,043,937	$  63,439

The accompanying notes are an integral part of these consolidated financial statements.

69

MACK-CALI REALTY, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands)

	Year Ended December 31,
CASH FLOWS FROM OPERATING ACTIVITIES	2010			2009			2008
Net income	$	63,439		$	63,728		$	64,879
Adjustments to reconcile net income to net cash provided by
Operating activities:
Depreciation and amortization, including related intangible assets		190,260			194,786			187,051
Depreciation and amortization on discontinued operations		409			1,811			1,678
Amortization of stock compensation		4,528			2,272			2,951
Amortization of deferred financing costs and debt discount		2,656			2,730			2,873
Equity in (earnings) loss of unconsolidated joint venture, net		(2,276	)		5,560			39,752
Gain on sale of investment in marketable securities		--			--			(471	)
Gain on reduction of other obligations		--			(1,693	)		(9,063	)
(Realized gains) unrealized losses on disposition of rental property		(4,447	)		--			--
Impairment charge on rental property		9,521			--			--
Impairment charge on rental property from discontinued operations		--			16,563			--
Distributions of cumulative earnings from unconsolidated joint ventures		2,311			2,637			5,784
Changes in operating assets and liabilities:
Increase in unbilled rents receivable, net		(7,458	)		(6,859	)		(4,636	)
(Increase) decrease in deferred charges and other assets, net		(24,069	)		403			(20,324	)
(Increase) decrease in accounts receivable, net		(4,306	)		14,880			13,266
Decrease in accounts payable, accrued expenses and other liabilities		(424	)		(4,267	)		(8,950	)
Increase (decrease) in rents received in advance and security deposits		3,184			(1,570	)		2,414
(Decrease) increase in accrued interest payable		(10,292	)		3,705			(1,215	)
Net cash provided by operating activities	$	223,036		$	294,686		$	275,989
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to rental property and related intangibles	$	(92,499	)	$	(77,767	)	$	(91,734	)
Repayment of notes receivable		--			11,441			166
Investment in unconsolidated joint ventures		(954	)		(6,327	)		(7,779	)
Distributions in excess of cumulative earnings from unconsolidated joint ventures		2,410			518			4,565
Proceeds from the sale of available for sale securities		--			--			5,355
Decrease (increase) in restricted cash		2,018			(7,962	)		894
Net cash used in investing activities	$	(89,025	)	$	(80,097	)	$	(88,533	)
CASH FLOW FROM FINANCING ACTIVITIES
Borrowings from revolving credit facility	$	250,000		$	337,000		$	1,137,100
Repayment of revolving credit facility and money market loans		(22,000	)		(498,000	)		(1,226,100	)
Proceeds from senior unsecured notes		--			246,238			--
Repayments of senior unsecured notes		(465,000	)		(199,724	)		(100,276	)
Proceeds from mortgages and loans payable		11,000			81,500			240,000
Repurchase of common stock		--			--			(5,198	)
Repayment of mortgages, loans payable and other obligations		(8,154	)		(11,462	)		(28,903	)
Payment of financing costs		(2,074	)		(2,766	)		(952	)
Proceeds from offering of common stock		--			274,826			--
Proceeds from stock options exercised		1,504			504			2,311
Payment of dividends and distributions		(168,495	)		(173,267	)		(208,533	)
Net cash (used in) provided by financing activities	$	(403,219	)	$	54,849		$	(190,551	)
Net (decrease) increase in cash and cash equivalents	$	(269,208	)	$	269,438		$	(3,095	)
Cash and cash equivalents, beginning of period		291,059			21,621			24,716
Cash and cash equivalents, end of period	$	21,851		$	291,059		$	21,621
The accompanying notes are an integral part of these consolidated financial statements.

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MACK-CALI REALTY, L.P. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.   ORGANIZATION AND BASIS OF PRESENTATION

ORGANIZATION

Mack-Cali Realty, L.P., a Delaware limited partnership, together with its subsidiaries (collectively, the “Company”), was formed on May 31, 1994 to conduct the business of providing leasing, management, acquisition, development, construction and tenant-related services for its sole general partner, Mack-Cali Realty Corporation (“the Corporation” or “General Partner”). The Company, through its operating divisions and subsidiaries, including the Mack-Cali property-owning partnerships and limited liability companies (collectively, the “Property Partnerships”) is the entity through which all of the General Partner’s operations are conducted.

The General Partner is a fully-integrated self-administered, self-managed real estate investment trust (“REIT”). The General Partner controls the Company as its sole general partner and owned an 86.0 percent and 85.4 percent common unit interest in the Company as of December 31, 2010 and 2009, respectively.

The General Partner’s business is the ownership of interests in and operation of the Company, and all of the General Partner’s expenses are incurred for the benefit of the Company. The General Partner is reimbursed by the Company for all expenses it incurs relating to the ownership and operation of the Company.

As of December 31, 2010, the Company owned or had interests in 277 properties plus developable land (collectively, the “Properties”).  The Properties aggregate approximately 32.2 million square feet, which are comprised of 265 buildings, primarily office and office/flex buildings totaling approximately 31.8 million square feet (which include eight buildings, primarily office buildings aggregating approximately 1.2 million square feet owned by unconsolidated joint ventures in which the Company has investment interests), six industrial/warehouse buildings totaling approximately 387,400 square feet, two retail properties totaling approximately 17,300 square feet, one hotel (which is owned by an unconsolidated joint venture in which the Company has an investment interest) and three parcels of land leased to others.
60; The Properties are located in five states, primarily in the Northeast, plus the District of Columbia.

BASIS OF PRESENTATION

The accompanying consolidated financial statements include all accounts of the Company, its majority-owned and/or controlled subsidiaries, which consist principally of Mack-Cali Realty, L.P. (the “Company”), and variable interest entities for which the Company has determined itself to be the primary beneficiary, if any.  See Note 2: Significant Accounting Policies – Investments in Unconsolidated Joint Ventures for the Company’s treatment of unconsolidated joint venture interests.  Intercompany accounts and transactions have been eliminated.

The preparation of financial statements in conformity with generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.  The Company evaluated subsequent events through February 8, 2011, the date these financial statements were available to be issued.  Certain reclassifications have been made to prior period amounts in order to conform with current period presentation.

On July 1, 2009, the Financial Accounting Standards Board (“FASB”) issued the FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles, also known as FASB Accounting Standards Codification (“ASC”) 105-10, General Accepted Accounting Principles, (“ASC 105-10”).  ASC 105-10 establishes the FASB Accounting Standards Codification (“Codification”) as the single source of authoritative U.S. GAAP recognized by the FASB to be applied by nongovernmental entities.  Rules and interpretive releases of the Securities and Exchange Commission (“SEC”) under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants.  The Codification supersedes all existing non-SEC accounting and rep orting standards.  All other nongrandfathered, non-SEC accounting literature not included in the Codification will become nonauthoritative.  Following the Codification, the FASB will not issue new standards in the form of Statements, FASB Staff Positions or Emerging Issues Task Force Abstracts.  Instead, it will issue Accounting Standards Updates, which will serve to update the Codification, provide background information about the guidance and provide the basis for conclusions on the changes to the Codification.  GAAP was not intended to be changed as a result of the FASB’s Codification project, but it will change the way the guidance is organized and presented.  The Company has implemented the Codification in this annual report by providing references to the Codification topics, as appropriate.

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2.   SIGNIFICANT ACCOUNTING POLICIES

Rental

Property Rental properties are stated at cost less accumulated depreciation and amortization.  Costs directly related to the acquisition, development and construction of rental properties are capitalized. Pursuant to the Company’s adoption of ASC 805, Business Combinations, effective January 1, 2009, acquisition-related costs are expensed as incurred.  Capitalized development and construction costs include pre-construction costs essential to the development of the property, development and construction costs, interest, property taxes, insurance, salaries and other project costs incurred during the period of development.  Included in total rental property is construction, tenant improvement and development in-progress of $65,990,000 and $107,226,000 as of December 31, 2010 and 2009, respectively.  Ordinary repairs and maintenance are expensed as incurred; major replacements an d betterments, which improve or extend the life of the asset, are capitalized and depreciated over their estimated useful lives.  Fully-depreciated assets are removed from the accounts.

The Company considers a construction project as substantially completed and held available for occupancy upon the completion of tenant improvements, but no later than one year from cessation of major construction activity (as distinguished from activities such as routine maintenance and cleanup).  If portions of a rental project are substantially completed and occupied by tenants, or held available for occupancy, and other portions have not yet reached that stage, the substantially completed portions are accounted for as a separate project.  The Company allocates costs incurred between the portions under construction and the portions substantially completed and held available for occupancy, and capitalizes only those costs associated with the portion under construction.

Properties are depreciated using the straight-line method over the estimated useful lives of the assets.  The estimated useful lives are as follows:

Leasehold interests	Remaining lease term
Buildings and improvements	5 to 40 years
Tenant improvements	The shorter of the term of the
	related lease or useful life
Furniture, fixtures and equipment	5 to 10 years

Upon acquisition of rental property, the Company estimates the fair value of acquired tangible assets, consisting of land, building and improvements, and identified intangible assets and liabilities assumed, generally consisting of the fair value of (i) above and below market leases, (ii) in-place leases and (iii) tenant relationships.  The Company allocates the purchase price to the assets acquired and liabilities assumed based on their fair values.  The Company records goodwill or a gain on bargain purchase (if any) if the net assets acquired/liabilities assumed exceed the purchase consideration of a transaction.  In estimating the fair value of the tangible and intangible assets acquired, the Company considers information obtained about each property as a result of its due diligence and marketing and l easing activities, and utilizes various valuation methods, such as estimated cash flow projections utilizing appropriate discount and capitalization rates, estimates of replacement costs net of depreciation, and available market information.  The fair value of the tangible assets of an acquired property considers the value of the property as if it were vacant.

Above-market and below-market lease values for acquired properties are initially recorded based on the present value, (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to each in-place lease and (ii) management’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases and the initial term plus the term of any below-market fixed rate renewal options for below-market leases. The capitalized above-market lease values are amortized as a reduction of base rental revenue over the remaining term of the respective leases, and the capitalized below-market lease values are amortized as an increase to base rental revenue over t he remaining initial terms plus the terms of any below-market fixed rate renewal options of the respective leases.

72

Other intangible assets acquired include amounts for in-place lease values and tenant relationship values, which are based on management’s evaluation of the specific characteristics of each tenant’s lease and the Company’s overall relationship with the respective tenant.  Factors to be considered by management in its analysis of in-place lease values include an estimate of carrying costs during hypothetical expected lease-up periods considering current market conditions, and costs to execute similar leases.  In estimating carrying costs, management includes real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease-up periods, depending on local market conditions.  In estimating costs to execute similar leases, manage ment considers leasing commissions, legal and other related expenses.  Characteristics considered by management in valuing tenant relationships include the nature and extent of the Company’s existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals.  The value of in-place leases are amortized to expense over the remaining initial terms of the respective leases.  The value of tenant relationship intangibles are amortized to expense over the anticipated life of the relationships.

On a periodic basis, management assesses whether there are any indicators that the value of the Company’s rental properties held for use may be impaired.  In addition to identifying any specific circumstances which may affect a property or properties, management considers other criteria for determining which properties may require assessment for potential impairment.  The criteria considered by management include reviewing low leased percentages, significant near-term lease expirations, recently acquired properties, current and historical operating and/or cash flow losses, near-term mortgage debt maturities or other factors that might impact the Company’s intent and ability to hold the property.  A property’s value is impaired only if management’s estimate of the aggregate future c ash flows (undiscounted and without interest charges) to be generated by the property is less than the carrying value of the property.  To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the property over the fair value of the property.  The Company’s estimates of aggregate future cash flows expected to be generated by each property are based on a number of assumptions.  These assumptions are generally based on management’s experience in its local real estate markets and the effects of current market conditions.  The assumptions are subject to economic and market uncertainties including, among others, demand for space, competition for tenants, changes in market rental rates, and costs to operate each property.  As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the future cash flows estimated by management in its impairment analyses may not be achieved, and actual losses or impairment may be realized in the future.

Rental Property

Held for Sale and

Discontinued

Operations When assets are identified by management as held for sale, the Company discontinues depreciating the assets and estimates the sales price, net of selling costs, of such assets.  If, in management’s opinion, the estimated net sales price of the assets which have been identified as held for sale is less than the net book value of the assets, a valuation allowance is established.  Properties identified as held for sale and/or disposed of are presented in discontinued operations for all periods presented.  See Note 7: Discontinued Operations.

If circumstances arise that previously were considered unlikely and, as a result, the Company decides not to sell a property previously classified as held for sale, the property is reclassified as held and used.  A property that is reclassified is measured and recorded individually at the lower of (a) its carrying amount before the property was classified as held for sale, adjusted for any depreciation (amortization) expense that would have been recognized had the property been continuously classified as held and used, or (b) the fair value at the date of the subsequent decision not to sell.

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Investments in

Unconsolidated

Joint Ventures The Company accounts for its investments in unconsolidated joint ventures under the equity method of accounting.  The Company applies the equity method by initially recording these investments at cost, as Investments in Unconsolidated Joint Ventures, subsequently adjusted for equity in earnings and cash contributions and distributions.

ASC 810, Consolidation, provides guidance on the identification of entities for which control is achieved through means other than voting rights (“variable interest entities” or “VIEs”) and the determination of which business enterprise, if any, should consolidate the VIE (the “primary beneficiary”).  Generally, the consideration of whether an entity is a VIE applies when either (1) the equity investors (if any) lack one or more of the essential characteristics of a controlling financial interest, (2) the equity investment at risk is insufficient to finance that entity’s activities without additional subordinated financial support or (3) the equity investors have voting rights that are not proportionate to their economic interests and the activities of the entity involve or are conducted on behalf of an investor with a disproportionately small voting interest.< /font>

On January 1, 2010, the Company adopted the updated provisions of ASC 810, pursuant to FASB No. 167, which amends FIN 46(R) to require ongoing reassessments of whether an enterprise is the primary beneficiary of a variable interest entity.  Additionally, FASB No. 167 amends FIN 46(R) to eliminate the quantitative approach previously required for determining the primary beneficiary of a variable interest entity, which was based on determining which enterprise absorbs the majority of the entity’s expected losses, receives a majority of the entity’s expected residual returns, or both.  FASB No. 167 amends certain guidance in Interpretation 46(R) for determining whether an entity is a variable interest entity.  Also, FASB No. 167 amends FIN 46(R) to require enhanced disclosures that will provide u sers of financial statements with more transparent information about an enterprise’s involvement in a variable interest entity.  The enhanced disclosures are required for any enterprise that holds a variable interest in a variable interest entity.  The adoption of this guidance did not have a material impact to these financial statements.  See Note 4: Investments in Unconsolidated Joint Ventures for disclosures regarding the Company’s unconsolidated joint ventures.

On a periodic basis, management assesses whether there are any indicators that the value of the Company’s investments in unconsolidated joint ventures may be impaired.  An investment is impaired only if management’s estimate of the value of the investment is less than the carrying value of the investment, and such decline in value is deemed to be other than temporary.  To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the value of the investment.  The Company’s estimates of value for each investment (particularly in commercial real estate joint ventures) are based on a number of assumptions that are subject to economic and market uncertainties including, among others, demand for space, competition for tenants, ch anges in market rental rates, and operating costs.  As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the values estimated by management in its impairment analyses may not be realized, and actual losses or impairment may be realized in the future.  See Note 4: Investments in Unconsolidated Joint Ventures.

Cash and Cash

Equivalents All highly liquid investments with a maturity of three months or less when purchased are considered to be cash equivalents.

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Marketable

Securities The Company classifies its marketable securities among three categories: held-to-maturity, trading and available-for-sale.  Unrealized holding gains and losses relating to available-for-sale securities are excluded from earnings and reported as other comprehensive income (loss) in equity until realized.  A decline in the market value of any held-to-maturity marketable security below cost that is deemed to be other than temporary results in a reduction in the carrying amount to fair value.  Any impairment would be charged to earnings and a new cost basis for the security established.

The fair value of the marketable securities is determined using level I inputs under ASC 820, Fair Value Measurements and Disclosures.  Level I inputs represent quoted prices available in an active market for identical investments as of the reporting date.

The Company received approximately $65,000 in dividend income from its holdings in marketable securities during the year ended December 31, 2008.  During the year ended December 31, 2008, the Company disposed of its marketable securities for aggregate net proceeds of $5.4 million and realized a gain of $471,000.

Deferred

Financing Costs Costs incurred in obtaining financing are capitalized and amortized over the term of the related indebtedness. Amortization of such costs is included in interest expense and was $2,656,000, $2,730,000 and $2,873,000 for the years ended December 31, 2010, 2009 and 2008, respectively.

Deferred

Leasing Costs Costs incurred in connection with leases are capitalized and amortized on a straight-line basis over the terms of the related leases and included in depreciation and amortization.  Unamortized deferred leasing costs are charged to amortization expense upon early termination of the lease. Certain employees of the Corporation are compensated for providing leasing services to the Properties.  The portion of such compensation, which is capitalized and amortized, approximated $3,986,000, $3,725,000 and $3,690,000 for the years ended December 31, 2010, 2009 and 2008, respectively.

Derivative

Instruments The Company measures derivative instruments, including certain derivative instruments embedded in other contracts, at fair value and records them as an asset or liability, depending on the Company’s rights or obligations under the applicable derivative contract.  For derivatives designated and qualifying as fair value hedges, the changes in the fair value of both the derivative instrument and the hedged item are recorded in earnings.  For derivatives designated as cash flow hedges, the effective portions of the derivative are reported in other comprehensive income (“OCI”) and are subsequently reclassified into earnings when the hedged item affects earnings. Changes in fair value of derivative instruments not designated as hedging and ineffective portions of hedges are recognized in earnings in the affected period.

Revenue

Recognition Base rental revenue is recognized on a straight-line basis over the terms of the respective leases. Unbilled rents receivable represents the amount by which straight-line rental revenue exceeds rents currently billed in accordance with the lease agreements.  Above-market and below-market lease values for acquired properties are initially recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to each in-place lease and (ii) management’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining terms of the lease for above-market leases and the remaining initial terms plus the terms of any below-market fixed-rate renew al options for below-market leases.  The capitalized above-market lease values for acquired properties are amortized as a reduction of base rental revenue over the remaining terms of the respective leases, and the capitalized below-market lease values are amortized as an increase to base rental revenue over the remaining initial terms plus the terms of any below-market fixed-rate renewal options of the respective leases.  Escalations and recoveries from tenants are received from tenants for certain costs as provided in the lease agreements.  These costs generally include real estate taxes, utilities, insurance, common area maintenance and other recoverable costs.  See Note 16: Tenant Leases.  Construction services revenue includes fees earned and reimbursements received by the Company for providing construction management and general contractor services to clients.  Construction services revenue is recognized on the percentage of completion method.& #160; Using this method, profits are recorded on the basis of estimates of the overall profit and percentage of completion of individual contracts.  A portion of the estimated profits is accrued based upon estimates of the percentage of completion of the construction contract.  This revenue recognition method involves inherent risks relating to profit and cost estimates.  Real estate services revenue includes property management, facilities management, leasing commission fees and other services, and payroll and related costs reimbursed from clients.  Other income includes income from parking spaces leased to tenants, income from tenants for additional services arranged for by the Company and income from tenants for early lease terminations.

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Allowance for

Doubtful Accounts Management periodically performs a detailed review of amounts due from tenants to determine if accounts receivable balances are impaired based on factors affecting the collectability of those balances.  Management’s estimate of the allowance for doubtful accounts requires management to exercise significant judgment about the timing, frequency and severity of collection losses, which affects the allowance and net income.

Income and

Other Taxes The Company is a partnership, and, as a result, all income and losses of the partnership are allocated to the partners for inclusion in their respective tax returns. Accordingly, no provision or benefit for income taxes has been made in the accompanying financial statements.

As of December 31, 2010, the estimated net basis of the rental property for federal income tax purposes was lower than the net assets as reported in the Company’s financial statements by approximately $751,769.  The Company’s taxable income for the year ended December 31, 2010 was estimated to be approximately $123,673 and for the years ended December 31, 2009 and 2008 was approximately $155,696 and $163,229, respectively.  The differences between book income and taxable income primarily result from differences in depreciation expenses, the recording of rental income, differences in the deductibility of certain expenses for tax purposes, differences in revenue recognition and the rules for tax purposes of a property exchange.

Certain of the Company’s corporate subsidiaries are taxable REIT subsidiaries (each a “TRS”).  In general, a TRS may perform additional services for tenants of the Company and generally may engage in any real estate or non-real estate related business (except for the operation or management of health care facilities or lodging facilities or the providing to any person, under a franchise, license or otherwise, rights to any brand name under which any lodging facility or health care facility is operated).  A TRS is subject to corporate federal income tax.  If the Corporation fails to qualify as a REIT in any taxable year, the Corporation will be subject to federal income tax (including any applicable alternative minimum tax) on its taxable income at regular corporate tax rates.  The Corporation is subject to certain state and local taxes.

Pursuant to the amended provisions related to uncertain tax provisions of ASC 740, Income Taxes, the Company recognized no material adjustments regarding its tax accounting treatment.  The Company expects to recognize interest and penalties related to uncertain tax positions, if any, as income tax expense, which is included in general and administrative expense.

In the normal course of business, the Company or one of its subsidiaries is subject to examination by federal, state and local jurisdictions in which it operates, where applicable.  As of December 31, 2010, the tax years that remain subject to examination by the major tax jurisdictions under the statute of limitations are generally from the year 2006 forward.

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Earnings

Per Unit The Company presents both basic and diluted earnings per unit (“EPU”).  Basic EPU excludes dilution and is computed by dividing net income available to common unitholders by the weighted average number of units outstanding for the period.  Diluted EPU reflects the potential dilution that could occur if securities or other contracts to issue common units were exercised or converted into common units, where such exercise or conversion would result in a lower EPU amount.

Distributions

Payable The distributions payable at December 31, 2010 represents distributions payable to preferred unitholders (10,000 Series C preferred units) and common unitholders (92,613,210 units), for all such holders of record as of January  5, 2011 with respect to the fourth quarter 2010.  The fourth quarter 2010 preferred unit distributions of $50.00 per preferred unit and common unit distributions of $0.45 per common unit were approved by the Corporation’s Board of Directors on December 7, 2010.  The common unit distributions and preferred unit distributions payable were paid on January 14, 2011.

The distributions payable at December 31, 2009 represents distributions payable to preferred unitholders (10,000 Series C preferred units) and common unitholders (92,464,894 common units), for all such holders of record as of January 6, 2010 with respect to the fourth quarter 2009.  The fourth quarter 2009 Series C preferred unit distributions of $50.00 per preferred unit and common unit distributions of $0.45 per common unit were approved by the Corporation’s Board of Directors on December 8, 2009.  The common unit distributions and preferred unit distributions payable were paid on January 15, 2010.

The Company has determined that the $1.80 distribution per common unit paid during the year ended December 31, 2010 represented approximately 75 percent ordinary income and approximately 25 percent return of capital to its unitholders; the $1.99 dividend per common unit paid during the year ended December 31, 2009 represented approximately 93 percent ordinary income and approximately 7 percent return of capital to its unitholders; and the $2.56 dividend per common unit paid during the year ended December 31, 2008 represented approximately 81 percent ordinary income, approximately 18 percent return of capital and approximately one percent capital gain to its unitholders.

Costs Incurred

For Stock

Issuances Costs incurred in connection with the Corporation’s stock issuances are reflected as a reduction of General Partner’s capital.

Stock

Compensation The Company accounts for stock options and restricted stock awards granted prior to 2002 using the intrinsic value method prescribed in the previously existing accounting guidance on accounting for stock issued to employees.  Under this guidance, compensation cost for stock options is measured as the excess, if any, of the quoted market price of the Corporation’s stock at the date of grant over the exercise price of the option granted.  Compensation cost for stock options is recognized ratably over the vesting period.  The Corporation’s policy is to grant options with an exercise price equal to the quoted closing market price of the Corporation’s stock on the business day preceding the grant date.  Accordingly, no compensation cost has been recognized under the Corporation’s stock option plans for the granting of stock options made prior to 2002.
60; Restricted stock awards granted prior to 2002 are valued at the vesting dates of such awards with compensation cost for such awards recognized ratably over the vesting period.

In 2002, the Company adopted the provisions of ASC 718, Compensation-Stock Compensation.  In 2006, the Company adopted the amended guidance, which did not have a material effect on the Company’s financial position and results of operations.  These provisions require that the estimated fair value of restricted stock (“Restricted Stock Awards”) and stock options at the grant date be amortized ratably into expense over the appropriate vesting period.  The Company recorded restricted stock expense of $4,121,000, $4,097,000 and $4,870,000 for the years ended December 31, 2010, 2009 and 2008, respectively.

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Other

Comprehensive

Income Other comprehensive income (loss) includes items that are recorded in equity, such as unrealized holding gains or losses on marketable securities available for sale.

3.   REAL ESTATE TRANSACTIONS

On December 17, 2010, the Company repaid a $26.8 million mortgage loan which encumbered One Grande Commons, a 198,376 square foot unconsolidated joint venture office property located in Bridgewater, New Jersey.  Concurrent with the repayment, the Company placed an $11 million mortgage financing on the property obtained from a bank.  As a result of the repayment of the existing mortgage loan, the Company obtained a controlling interest and is consolidating the office property.  The new mortgage loan bears interest at a rate of LIBOR plus 200 basis points and matures on December 31, 2011, with three one-year extension options, subject to certain conditions and payment of a fee.

The Company’s office property located at 105 Challenger Road in Ridgefield Park, New Jersey, aggregating 150,050 square feet, was collateral for a $19.5 million mortgage loan scheduled to mature on June 6, 2010.  The Company had recorded an impairment charge on the property of $16.6 million at December 31, 2009.   On June 1, 2010, the Company transferred the deed for 105 Challenger to the lender in satisfaction of its obligations.  As a result, the Company recorded a gain on the disposal of the office property of approximately $4.4 million.  See Note 7: Discontinued Operations.

The Company’s office property located at 2200 Renaissance Boulevard in King of Prussia, Pennsylvania, aggregating 174,124 square feet, is collateral for a mortgage loan scheduled to mature on December 1, 2012 with a balance of $16.2 million at December 31, 2010.  As of December 31, 2010, the Company estimated that the carrying value of the property may not be recoverable over its anticipated holding period. In order to reduce the carrying value of the property to its estimated fair market value of approximately $13.4 million, the Company recorded an impairment charge of approximately $9.5 million at December 31, 2010.  The estimated fair value was estimated on a Level 3 basis (as provided by ASC 820, Fair Value Measurements and Disclosures) based on discounting the aggregate future cash flows of the property includ ing reversion at a specific yield.  The discounted cash flow model incorporates expected timing and level of cash flows and key inputs and assumptions including rental income and expense amounts, related rental income and expense growth rates, the discount rate and capitalization rate.

4.   INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES

The debt of the Company’s unconsolidated joint ventures generally is non-recourse to the Company, except for customary exceptions pertaining to such matters as intentional misuse of funds, environmental conditions and material misrepresentations, and except as otherwise indicated below.

PLAZA VIII AND IX ASSOCIATES, L.L.C.

Plaza VIII and IX Associates, L.L.C. is a joint venture between the Company and Columbia Development Company, L.L.C. (“Columbia”), which owns land for future development, located on the Hudson River waterfront in Jersey City, New Jersey, adjacent to the Company’s Harborside Financial Center office complex.  The Company and Columbia each hold a 50 percent interest in the venture.  The venture owns undeveloped land currently used as a parking facility.

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SOUTH PIER AT HARBORSIDE – HOTEL

The Company has a joint venture with Hyatt Corporation (“Hyatt”) which owns a 350-room hotel on the South Pier at Harborside Financial Center, Jersey City, New Jersey.  The Company owns a 50 percent interest in the venture.

The venture has a mortgage loan with a balance as of December 31, 2010 of $66.0 million collateralized by the hotel property.  The loan carries an interest rate of 6.15 percent and matures in November 2016.  The venture has a loan with a balance as of December 31, 2010 of $5.9 million with the City of Jersey City, provided by the U.S. Department of Housing and Urban Development.  The loan currently bears interest at fixed rates ranging from 6.09 percent to 6.62 percent and matures in August 2020.  The Company has posted a $5.9 million letter of credit in support of this loan, half of which is indemnified by Hyatt.

RED BANK CORPORATE PLAZA

The Company has a joint venture with The PRC Group, which owns Red Bank Corporate Plaza, a 92,878 square foot office building located in Red Bank, New Jersey.  The property is fully leased to Hovnanian Enterprises, Inc. through September 30, 2017.  The Company holds a 50 percent interest in the venture.

The venture has a loan with a commercial bank collateralized by the office property, which carries a balance as of December 31, 2010 of $20.4 million, bears interest at a rate of the London Interbank Offered Rate (“LIBOR”) plus 125 basis points and matures in April 2011.  LIBOR was 0.26 percent at December 31, 2010.  On January 26, 2010, the venture sold a vacant land parcel it had owned for approximately $1.7 million.

The Company performs management, leasing and other services for the property owned by the joint venture and recognized $91,000, $92,600 and $128,000 in fees for such services for the years ended December 31, 2010, 2009 and 2008, respectively.

MACK-GREEN-GALE LLC/GRAMERCY AGREEMENT

On May 9, 2006, the Company entered into a joint venture, Mack-Green-Gale LLC and subsidiaries (“Mack-Green”), with SL Green, pursuant to which Mack-Green held an approximate 96 percent interest in and acted as general partner of Gale SLG NJ Operating Partnership, L.P. (the “OPLP”).  The Company’s acquisition cost for its interest in Mack-Green was approximately $125 million, which was funded primarily through borrowing under the Company’s revolving credit facility.  At the time, the OPLP owned 100 percent of entities (“Property Entities”) which owned 25 office properties (the “OPLP Properties”) which aggregated 3.5 million square feet (consisting of 17 office properties aggregating 2.3 million square feet located in New Jersey and eight properties aggregat ing 1.2 million square feet located in Troy, Michigan).  In December 2007, the OPLP sold its eight properties located in Troy, Michigan for $83.5 million.  The venture recognized a loss of approximately $22.3 million from the sale.

As defined in the Mack-Green operating agreement, the Company shared decision-making equally with SL Green regarding:  (i) all major decisions involving the operations of Mack-Green; and (ii) overall general partner responsibilities in operating the OPLP.

The Mack-Green operating agreement generally provided for profits and losses to be allocated as follows:

(i) 99 percent of Mack-Green’s share of the profits and losses from 10 specific OPLP Properties allocable to the Company and one percent allocable to SL Green;

(ii) one percent of Mack-Green’s share of the profits and losses from eight specific OPLP Properties and its minor interest in four office properties allocable to the Company and 99 percent allocable to SL Green; and

(iii)         50 percent of all other profits and losses allocable to the Company and 50 percent allocable to SL Green.

Substantially all of the OPLP Properties were encumbered by mortgage loans with an aggregate outstanding principal balance of $276.3 million at March 31, 2009.  $185.0 million of the mortgage loans bore interest at a weighted average fixed interest rate of 6.26 percent per annum and matured at various times through May 2016.

Six of the OPLP Properties (the “Portfolio Properties”) were encumbered by $90.3 million of mortgage loans which bore interest at a floating rate of LIBOR plus 275 basis points per annum and were scheduled to mature in May 2009. The floating rate mortgage loans were provided to the six entities which owned the Portfolio Properties (collectively, the “Portfolio Entities”) by Gramercy, which was a related party of SL Green.  Based on the venture’s anticipated holding period pertaining to the Portfolio Properties, the venture believed that the carrying amounts of these properties may not have been recoverable at December 31, 2008.  Accordingly, as the venture determined that its carrying value of these properties exceeded the estimated fair value, it recorded an impairment charge of approximate ly $32.3 million as of December 31, 2008. 

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On April 29, 2009, the Company acquired the remaining interests in Mack-Green from SL Green.  As a result, the Company owns 100 percent of Mack-Green.  Additionally, on April 29, 2009, the mortgage loans with Gramercy on the Portfolio Properties (the “Gramercy Agreement”) were modified to provide for, among other things, interest to accrue at the current rate of LIBOR plus 275 basis points per annum, with the interest pay rate capped at 3.15 percent per annum.  Under the Gramercy Agreement, the payment of debt service is subordinate to the payment of operating expenses.  Interest at the pay rate is payable only out of funds generated by the Portfolio Properties and only to the extent that the Portfolio Properties’ operating expenses have been paid, with any accrued unpaid intere st above the pay rate serving to increase the balance of the amounts due at the termination of the agreement.  Any excess funds after payment of debt service generally will be escrowed and available for future capital and leasing costs, as well as to cover future cash flow shortfalls, as appropriate.  The Gramercy Agreement terminates on May 9, 2011.  Approximately six months in advance of the end of the term of the Gramercy Agreement, the Portfolio Entities are to provide estimates of each property’s fair market value (“FMV”).  Gramercy has the right to accept or reject the FMV.  If Gramercy rejects the FMV, Gramercy must market the property for sale in cooperation with the Portfolio Entities and must approve the ultimate sale.  However, Gramercy has no obligation to market a Portfolio Property if the FMV is less than the allocated amount due, including accrued, unpaid interest. If any Portfolio Property is not sold, the Portfolio Entities have agreed to give a deed in lieu of foreclosure, unless the FMV was equal to or greater than the allocated amount due for such Portfolio Property, in which case they can elect to have that Portfolio Property released by paying the FMV.  If Gramercy accepts the FMV, the Portfolio Property will be released from the Gramercy Agreement upon payment of the FMV.  Under the direction of Gramercy, the Company continues to perform management, leasing, and construction services for the Portfolio Properties at market terms.  The Portfolio Entities have a participation interest which provides for sharing 50 percent of any amount realized in excess of the allocated amounts due for each Portfolio Property.

As the Company acquired SL Green’s interests in Mack-Green, the Company owns 100 percent of Mack-Green and is consolidating Mack-Green as of the closing date.  Mack-Green, in turn, has been and will continue consolidating the OPLP as Mack-Green’s approximate 96 percent, general partner ownership interest in the OPLP remained unchanged as of the closing date.  Additionally, as of the closing date, the OPLP continues to consolidate its Property Entities which own 11 office properties aggregating 1.5 million square feet as its 100-percent ownership and rights regarding these entities were unchanged in the transaction.  The OPLP will not be consolidating the Portfolio Entities that own six office properties, aggregating 786,198 square feet, as the Gramercy Agreement is considered a reconsideration event under the provisions of ASC 810, Consolidation, and accordingly, the Portfolio Entities were deemed to be variable interest entities for which the OPLP was not considered the primary beneficiary based on the Gramercy Agreement as described above.  As a result of the SLG Transactions, the Company has an unconsolidated joint venture interest in the Portfolio Properties.

On March 31, 2010, the venture sold one of its unconsolidated Portfolio Properties subject to the Gramercy Agreement, 1280 Wall Street West, a 121,314 square foot office property, located in Lyndhurst, New Jersey, for approximately $13.9 million, which was primarily used to pay down mortgage loans pursuant to the Gramercy Agreement.

On December 17, 2010, the venture repaid the $26.8 million allocated loan amount of one of the unconsolidated Portfolio Properties which was subject to the Gramercy Agreement, One Grande Commons, a 198,376 square foot office property, located in Bridgewater, New Jersey.  Concurrent with the repayment, the venture placed $11 million mortgage financing on the property obtained from a bank.  As a result of the repayment of the existing mortgage loan, the venture, which is consolidated by the Company, obtained a controlling interest and is consolidating the office property.

The Company performs management, leasing, and construction services for properties owned by the unconsolidated joint ventures and recognized $861,000, $2.3 million and $5.2 million in income (net of $0, $1.1 million and $3.5 million in direct costs) for such services in the years ended December 31, 2010, 2009 and 2008, respectively.

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GE/GALE FUNDING LLC (Princeton Forrestal Village)

The Gale agreement signed as part of the Gale/Green transactions in May 2006 provided for the Company to acquire certain ownership interests in real estate projects (the “Non-Portfolio Properties”), subject to obtaining certain third party consents and the satisfaction of various project-related and/or other conditions.  Each of the Company’s acquired interests in the Non-Portfolio Properties provide for the initial distributions of net cash flow solely to the Company, and thereafter an affiliate of Mr. Gale (“Gale Affiliate”) has participation rights (“Gale Participation Rights”) in 50 percent of the excess net cash flow remaining after the distribution to the Company of the aggregate amount equal to the sum of: (a) the Company’s capital contributions, plus (b) an internal rate of return (“IRR”) of 10 percent per annum, accruing on the date or dates of the Company’s investments.

On May 9, 2006, as part of the Gale/Green transactions, the Company acquired from a Gale Affiliate for $1.8 million a 50 percent controlling interest in GMW Village Associates, LLC (“GMW Village”).  The Company consolidates GMW Village, which includes accounts for investments in unconsolidated joint venture and noncontrolling interests in consolidated joint ventures, with any profit and loss recorded in equity in earnings (loss) and noncontrolling interests.  GMW Village holds a 20 percent interest in GE/Gale Funding LLC (“GE Gale”).  GE Gale owns a 100 percent interest in the entity which owned Princeton Forrestal Village, a mixed-use, office/retail complex aggregating 527,015 square feet and located in Plainsboro, New Jersey (“Princeton Forrestal Village” or ̶ 0;PFV”).

In addition to the cash consideration paid to acquire the interest, the Company provided a Gale affiliate with the Gale Participation Rights.

The operating agreement of GE Gale, which is owned 80 percent by GEBAM, Inc., provides for, among other things, distributions of net cash flow, initially, in proportion to each member’s interest and subject to adjustment upon achievement of certain financial goals, as defined in the operating agreement.

On December 16, 2010, GE Gale sold PFV for $55 million, realizing a gain on the sale of $207,000 (of which the Company’s share of $41,000 is included in equity in earnings for the year ended December 31, 2010).

The Company performed management, leasing, and other services for PFV and recognized $1.4 million, $1.1 million and $881,000 in income (net of $0, $0 and $288,000 in direct costs) for such services in the years ended December 31, 2010, 2009 and 2008, respectively.

GALE KIMBALL, L.L.C.

On June 15,2006, the Company entered into a joint venture with a Gale Affiliate to form M-C Kimball, LLC (“M-C Kimball”).  M-C Kimball was formed for the sole purpose of acquiring a Gale Affiliate’s 33.33 percent membership interest in Gale Kimball, L.L.C. (“Gale Kimball”), an entity holding a 25 percent interest in 100 Kimball Drive LLC (“100 Kimball”), which developed and placed in service a 175,000 square foot office property that is leased to a single tenant, located at 100 Kimball Drive, Parsippany, New Jersey (the “Kimball Property”).

The operating agreement of M-C Kimball provides, among other things, for the Gale Participation Rights (of which Mark Yeager, a former executive vice president of the Corporation, has a direct 26 percent interest).

Gale Kimball is owned 33.33 percent by M-C Kimball and 66.67 percent by the Hampshire Generational Fund, L.L.C. (“Hampshire”).  The operating agreement of Gale Kimball provides, among other things, for the distribution of net cash flow, initially, in accordance with its members’ respective membership interests and, upon achievement of certain financial conditions, 50 percent to each of the Company and Hampshire.

100 Kimball is owned 25 percent by Gale Kimball and 75 percent by 100 Kimball Drive Realty Member LLC, an affiliate of JPMorgan(“JPM”).The operating agreement of 100 Kimball provides, among other things, for the distributions to be made in the following order:

(i)   first, to JPM, such that JPM is provided with an annual 12 percent compound preferred return on Preferred Equity Capital Contributions (as such term is defined in the operating agreement of 100 Kimball and largely comprised of development and construction costs);

(ii)   second, to JPM, as return of Preferred Equity Capital Contributions until complete repayment of such Preferred Equity Capital Contributions;

(iii)   third, to each of JPM and Gale Kimball in proportion to their respective membership interests until each member is provided, as a result of such distributions, with an annual twelve percent compound return on the Member’s Capital Contributions (as defined in the operating agreement of 100 Kimball, and excluding Preferred Equity Capital Contributions, if any); and

(iv)   fourth, 50 percent to each of JPM and Gale Kimball.

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On September 21, 2007, 100 Kimball obtained a $47 million mortgage loan which bore interest at a rate of 5.95 percent and was scheduled to mature in September 2012.  On December 30, 2009 the venture paid the lender $40 million to satisfy the debt and recorded a gain of $7.0 million (of which the Company’s share of $579,000 is included in equity in earnings for the year ended December 31, 2009).  Concurrently, 100 Kimball obtained a $32 million mortgage loan that bore interest at a rate of the greater of LIBOR plus 400 basis points, or 5.50 percent. The loan was set to mature on January 10, 2013 with two one-year extension options, subject to certain conditions and payment of a fee.

On December 10, 2010, 100 Kimball sold its office property for approximately $60 million, realizing a gain on the sale of $19.8 million (of which the Company’s share of $1.6 million is included in equity in earnings for the year ended December 31, 2010).  As a result of the sale the Company received a distribution of approximately $5.4 million, of which $2.4 million was paid out pursuant to the Gale Participation Rights.

The Company performs management, leasing, and other services for the property owned by 100 Kimball for which it recognized $262,000, $234,000 and $377,000 in income (net of $0, $0 and $1.0 million in direct costs) for such services in the years ended December 31, 2010, 2009 and 2008, respectively.

55 CORPORATE PARTNERS, LLC

On June 9,2006, the Company entered into a joint venture with a Gale Affiliate to form 55 Corporate Partners L.L.C. (“55 Corporate”).  55 Corporate was formed for the sole purpose of acquiring from a Gale Affiliate a 50 percent interest in SLG 55 Corporate Drive II LLC (“SLG 55”), an entity presently holding a 100 percent indirect condominium interest in a vacant land parcel located in Bridgewater, New Jersey, which can accommodate development of an approximately 205,000 square foot office building (the “55 Corporate Property”).  The remaining 50 percent in SLG 55 was owned by SLG Gale 55 Corporate LLC, an affiliate of SLGreen Realty Corp.(“SLG Gale 55”).

Sanofi-Aventis U.S. Inc. (“Sanofi”), which occupied neighboring buildings, exercised its option to cause the venture to construct a building on its vacant, developable land and has signed a lease for the building.  The lease has a term of 15 years, subject to three five-year extension options.  The construction of the building commenced in 2009 and was delivered to the tenant in January 2011.  The total estimated costs of the project are expected to be approximately $50.9 million.

The operating agreement of 55 Corporate provides, among other things, for the Gale Participation Rights (of which Mr. Yeager has a direct 26 percent interest).  If Mr. Gale receives any commission payments with respect to the Sanofi lease on the development property, Mr. Gale has agreed to pay to Mr. Yeager 26 percent of such payments.

The operating agreement of SLG 55 provided, among other things, for the distribution of the available net cash flow to each of 55 Corporate and SLG Gale 55 in proportion to their respective membership interests in SLG 55 (50 percent each).

On April 29, 2009, the Company acquired the remaining 50 percent interest in 55 Corporate from SLG Gale 55 Corporate LLC, an affiliate of SL Green.  As of the closing date, the Company owns 100 percent of and is consolidating the venture, 50 percent of which remains subject to the Gale Participation Rights.  In connection with this transaction, the Company also acquired the remaining interest in Mack-Green from an affiliate of SLG Gale 55 Corporate LLC.

12 VREELAND ASSOCIATES, L.L.C.

On September 8,2006, the Company entered into a joint venture with a Gale Affiliate to form M-C Vreeland, LLC (“M-C Vreeland”).  M-C Vreeland was formed for the sole purpose of acquiring a Gale Affiliate’s 50 percent membership interest in 12 Vreeland Associates, L.L.C., an entity owning an office property located at 12 Vreeland Road, Florham Park, New Jersey.

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The operating agreement of M-C Vreeland provides, among other things, for the Gale Participation Rights (of which Mark Yeager, a former executive vice president of the Company, has a direct 15 percent interest).

The office property at 12 Vreeland is a 139,750 square foot office building.  The property is subject to a fully-amortizing mortgage loan, which matures on July 1, 2012, and bears interest at 6.9 percent per annum.  As of December 31, 2010 the outstanding balance on the mortgage note was $3.2 million.

Under the operating agreement of 12 Vreeland Associates, L.L.C., M-C Vreeland has a 50 percent interest, with S/K Florham Park Associates, L.L.C. (the managing member) and its affiliate holding the other 50 percent.

BOSTON-DOWNTOWN CROSSING

On October 20, 2006, the Company formed a joint venture (the “MC/Gale JV LLC”) with Gale International/426 Washington St. LLC (“Gale/426”), which, in turn, entered into a joint venture (the “Vornado JV LLC”) with VNO 426 Washington Street JV LLC (“Vornado”), an affiliate of Vornado Realty LP, which was formed to acquire and redevelop the Filenes property located in the Downtown Crossing district of Boston, Massachusetts (the “Filenes Property”).

On January 25, 2007, (i) each of M-C/Gale JV LLC, Gale and Washington Street Realty Member LLC (“JPM”) formed a joint venture (“JPM JV LLC”), (ii) M-C/Gale JV LLC assigned its entire 50 percent ownership interest in the Vornado JV LLC to JPM JV LLC, (iii) the Limited Liability Company Agreement of Vornado JV LLC was amended to reflect, among other things, the change in the ownership structure described in subsection (ii) above, and (iv) the Limited Liability Company Agreement of MC/Gale JV LLC was amended and restated to reflect, among other things, the change in the ownership structure described in subsection (ii) above.  The Vornado JV LLC acquired the Filenes Property on January 29, 2007, for approximately $100 million.

On or about September 16, 2008, Vornado JV LLC was reorganized in contemplation of developing and converting the Filenes property into a condominium consisting of a retail unit, an office unit, a parking unit, a hotel unit and a residential unit.  Pursuant to this reorganization, (i) the Company and Gale/426 formed a new joint venture (“M-C/Gale JV II LLC”) and (ii) M-C/Gale JV II LLC and Washington Street Realty Member II LLC (“JPM II”) formed a new joint venture (“JPM JV II LLC”) to invest in a new joint venture (“Vornado JV II LLC”) with Vornado RTR DC LLC, an affiliate of Vornado Realty, LP (“Vornado II”).  Following this reorganization, Vornado JV LLC owns the interests in the retail unit and the office unit (the “Filenes Office/Retail Component& #8221;) and Vornado JV II LLC owns the interests in the parking unit, the hotel unit and the residential unit (“the “Filenes Hotel/Residential/Parking Component”).   In connection with the foregoing, (a) the Limited Liability Company Agreement of Vornado JV LLC, as amended, was amended and restated to reflect, among other things, the change in the ownership structure described above, (b) the Limited Liability Company Agreement of JPM JV LLC was amended and restated to reflect, among other things, the change in the ownership structure described above and (c) the Limited Liability Company Agreement of M-C/Gale JV LLC was amended and restated to reflect, among other things, the change in the ownership structure described above.

As a result of the foregoing transactions, (A) (i) the Filenes Office/Retail Component is owned by Vornado JV LLC, (ii) Vornado JV LLC is owned 50 percent by each of Vornado and JPM JV LLC, (iii) JPM JV LLC is owned 30 percent by M-C/Gale JV LLC, 70 percent by JPM and managed by Gale/426, which has no ownership interest in JPM JV LLC, and (iv) M-C/Gale JV LLC is owned 99.99 percent by the Company and 0.01 percent by Gale/426 and (B) (i) the Filenes Hotel/Residential/Parking Component is owned by Vornado JV II LLC, (ii) Vornado JV II LLC is owned 50 percent by each of Vornado II and JPM JV II LLC, (iii) JPM JV II LLC is owned 30 percent by M-C/Gale JV II LLC, 70 percent by JPM II and managed by Gale/426, which has no ownership interest in JPM JV II LLC, and (iv) M-C/Gale JV II LLC is owned 99.99 percent by the Company and 0.01 percent by Gale/426.  Thus, the Company holds approximately a 15 percent indirect ownership interest in each of Vornado JV LLC and Vornado JV II LLC and the Filenes Property.

Distributions are made (i) by Vornado JV LLC in proportion to its members’ respective ownership interests, (ii) by JPM JV LLC (a) initially, in proportion to its members’ respective ownership interests until JPM’s investment yields an 11 percent IRR, (b) thereafter, 60/40 to JPM and MC/Gale JV LLC, respectively, until JPM’s investment yields a 15 percent IRR and (c) thereafter, 50/50 to JPM and MC/Gale JV LLC, respectively, and (iii) by MC/Gale JV LLC (w) initially, in proportion to its members’ respective ownership interests until each member has received a 10 percent IRR on its investment, (x) thereafter, 65/35 to the Company and Gale/426, respectively, until the Company’s investment yields a 15 percent IRR, (y) if by the time the Company receives a 15 percent IRR on its investment, Gale/ 426 has not done so, 100 percent to Gale/426 until Gale/426’s investment yields a 15 percent IRR, and (z) thereafter,  50/50 to each of the Company and Gale/426.

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Distributions are made (i) by Vornado JV II LLC in proportion to its members’ respective ownership interests, (ii) by JPM JV II LLC (a) initially, in proportion to its members’ respective ownership interests until JPM II’s investment yields an 11 percent IRR, (b) thereafter, 60/40 to JPM II and M-C/Gale JV II LLC, respectively, until JPM II’s investment yields a 15 percent IRR and (c) thereafter, 50/50 to JPM II and M-C/Gale JV II LLC, respectively, and (iii) by M-C/Gale JV II LLC (w) initially, in proportion to its members’ respective ownership interests until each member has received a 10 percent IRR on its investment, (x) thereafter, 65/35 to the Company and Gale/426, respectively, until the Company’s investment yields a 15 percent IRR, (y) if by the time the Company receives a 15 percent IRR on its investment, Gale/426 has not done so, 100 percent to Gale/426 until Gale/426’s investment yields a 15 percent IRR, and (z) thereafter, 50/50 to each of the Company and Gale/426.

The joint venture has suspended its plans for the development of the Filenes Property which was to include approximately 1.2 million square feet consisting of office, retail, condominium apartments, hotel and a parking garage.  The project is subject to governmental approvals.  The venture recorded an impairment charge of approximately $69.5 million on its development project as of December 31, 2008.

GALE JEFFERSON, L.L.C.

On August 22, 2007, the Company entered into a joint venture with a Gale Affiliate to form M-C Jefferson, L.L.C. (“M-C Jefferson”).  M-C Jefferson was formed for the sole purpose of acquiring a Gale Affiliate’s 33.33 percent membership interest in Gale Jefferson, L.L.C. (“Gale Jefferson”), an entity holding a 25 percent interest in One Jefferson Road LLC (“One Jefferson”), which developed and placed in service a 100,000 square foot office property at One Jefferson Road, Parsippany, New Jersey, (“the Jefferson Property”).  The property has been fully leased to a single tenant through August 2025.

The operating agreement of M-C Jefferson provides, among other things, for the Gale Participation Rights (of which Mark Yeager, a former executive vice president of the Corporation, has a direct 26 percent interest).  Gale Jefferson is owned 33.33 percent by M-C Jefferson and 66.67 percent by the Hampshire Generational Fund, L.L.C. (“Hampshire”).  The operating agreements of Gale Jefferson provides, among other things, for the distribution of net cash flow, first, in accordance with its member’s respective interests until each member is provided, as a result of such distributions, with an annual 12 percent compound return on the Member’s Capital Contributions, as defined in the operating agreement and secondly, 50 percent to each of the Company and Hampshire.

One Jefferson has a loan in an amount not to exceed $21 million (with a balance of $20.4 million at December 31, 2010), bearing interest at a rate of LIBOR plus 160 basis points and maturing on October 24, 2011.

The Company performs management, leasing and other services for Gale Jefferson and recognized $532,000, $190,000 and $286,000 in income (net of $5.6 million, $646,000 and $9.6 million in direct costs) for such services for the years ended December 31, 2010, 2009 and 2008, respectively.

RAMLAND REALTY ASSOCIATES L.L.C. (One Ramland Road)

On August 20, 1998, the Company entered into a 50/50 joint venture with S.B. New York Realty Corp. to form Ramland Realty Associates L.L.C.  The venture was formed to own, manage and operate One Ramland Road, a 232,000 square foot office/flex building and adjacent developable land, located in Orangeburg, New York.  In August 1999, the joint venture completed redevelopment of the property and placed the office/flex building in service.  The venture recorded an impairment loss of approximately $4.3 million on its rental property as of December 31, 2007.  On December 31, 2008, the venture transferred the deed to the lender in satisfaction of its obligations, including its mortgage with a balance of $14.7 million, and recorded a gain on the disposal of its office property of $7.5 million.

The Company performed management, leasing and other services for the property when owned by the joint venture and recognized $57,000 in fees for such services for the year ended December 31, 2008.

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ROUTE 93 MASTER LLC (“Route 93 Participant”)/ROUTE 93 BEDFORD MASTER LLC (with the Route 93 Participant, collectively, the “Route 93 Venture”)

On June 1, 2006, the Route 93 Venture was formed between the Route 93 Participant, a majority-owned subsidiary of the Company, having a 30 percent interest and the Commingled Pension Trust Fund (Special Situation Property) of JPMorgan Chase Bank having a 70 percent interest, for the purpose of acquiring seven office buildings, aggregating 666,697 square feet, located in the towns of Andover, Bedford and Billerica, Massachusetts.  Profits and losses were shared by the partners in proportion to their respective interests until the investment yielded an 11 percent IRR, then sharing shifted to 40/60, and when the IRR reached 15 percent, then sharing shifted to 50/50.  The Route 93 Participant is a joint venture between the Company and a Gale affiliate.  Profits and losses were shared by the partners under this venture in proportion to their respective interests (83.3/16.7) until the investment yielded an 11 percent IRR, then sharing shifted to 50/50.

On March 31, 2009, on account of the deterioration at the time in the commercial real estate markets in the Boston area, the Company wrote off its investment in the venture and recorded an impairment charge in equity in earnings (loss) of $4.0 million (of which $0.6 million was attributable to noncontrolling interest in consolidated joint ventures) during the period.  The Route 93 Ventures had a mortgage loan with a $44.2 million balance at September 1, 2009 collateralized by its office properties.  The loan bore interest at a rate of LIBOR plus 220 basis points and was scheduled to mature on July 11, 2009.  On September 2, 2009, the venture transferred the deeds to the lender in satisfaction of its obligations.

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SUMMARIES OF UNCONSOLIDATED JOINT VENTURES

The following is a summary of the financial position of the unconsolidated joint ventures in which the Company had investment interests as of December 31, 2010 and 2009:  (dollars in thousands)

	December 31, 2010
	Plaza		Red Bank		Princeton			Boston-
	VIII & IX	Harborside	Corporate	Gramercy	Forrestal	Gale	12	Downtown	Gale	Combined
	Associates	South Pier	Plaza I & II	Agreement	Village	Kimball	Vreeland	Crossing	Jefferson	Total
Assets:
Rental property, net	$   8,947	$ 64,964	$ 23,594	$ 40,786	--	--	$ 14,081	--	--	$ 152,372
Other assets	906	11,681	6,422	6,261	$  1,434	$      51	734	$ 46,062	$ 2,415	75,966
Total assets	$   9,853	$ 76,645	$ 30,016	$ 47,047	$  1,434	$      51	$ 14,815	$ 46,062	$ 2,415	$ 228,338
Liabilities and
partners’/members’
capital (deficit):
Mortgages, loans payable
and other obligations	--	$ 71,914	$ 20,424	$ 50,978	--	--	$   3,161	--	--	$ 146,477
Other liabilities	$      529	4,820	89	1,719	$     337	--	--	--	--	7,494
Partners’/members’
capital (deficit)	9,324	(89)	9,503	(5,650)	1,097	$      51	$ 11,654	$ 46,062	$ 2,415	$   74,367
Total liabilities and
partners’/members’
capital (deficit)	$   9,853	$ 76,645	$ 30,016	$ 47,047	$  1,434	$      51	$ 14,815	$ 46,062	$ 2,415	$ 228,338
Company’s investments
in unconsolidated
joint ventures, net	$   4,584	$   1,161	$   4,598	--	--	--	$   9,860	$ 13,022	$    995	$   34,220

	December 31, 2009
	Plaza		Red Bank		Princeton			Boston-
	VIII & IX	Harborside	Corporate	Gramercy	Forrestal	Gale	12	Downtown	Gale	Combined
	Associates	South Pier	Plaza I & II	Agreement	Village	Kimball	Vreeland	Crossing	Jefferson	Total
Assets:
Rental property, net	$   9,560	$ 61,836	$ 24,884	$   73,037	$ 38,739	--	$ 15,265	--	--	$ 223,321
Other assets	997	15,255	4,623	8,631	21,937	$ 1,998	1,068	$ 45,850	$ 1,780	102,139
Total assets	$ 10,557	$ 77,091	$ 29,507	$   81,668	$ 60,676	$ 1,998	$ 16,333	$ 45,850	$ 1,780	$ 325,460
Liabilities and
partners’/members’
capital (deficit):
Mortgages, loans payable
and other obligations	--	$ 73,553	$ 20,764	$   90,288	$ 51,187	--	$   5,007	--	--	$ 240,799
Other liabilities	$      532	4,374	162	2,589	3,830	--	--	--	--	11,487
Partners’/members’
capital (deficit)	10,025	(836)	8,581	(11,209)	5,659	$ 1,998	11,326	$ 45,850	$ 1,780	73,174
Total liabilities and
partners’/members’
capital (deficit)	$ 10,557	$ 77,091	$ 29,507	$   81,668	$ 60,676	$ 1,998	$ 16,333	$ 45,850	$ 1,780	$ 325,460
Company’s investments
in unconsolidated
joint ventures, net	$   4,935	$      860	$   4,104	--	$   1,211	$ 1,259	$   9,599	$ 12,948	$    764	$   35,680

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SUMMARIES OF UNCONSOLIDATED JOINT VENTURES

The following is a summary of the results of operations of the unconsolidated joint ventures for the period in which the Company had investment interests during the years ended December 31 2010, 2009 and 2008:  (dollars in thousands)

	Year Ended December 31, 2010
		Plaza	Ramland		Red Bank			Princeton				Boston-
		VIII & IX	Realty/	Harborside	Corporate		Gramercy	Forrestal	Route 93	Gale	12	Downtown	Gale	Combined
		Associates	Other	South Pier	Plaza I & II	M-G-G	Agreement	Village	Portfolio	Kimball	Vreeland	Crossing	Jefferson	Total
Total revenues		$    798	--	$ 34,680	$ 4,325	--	$ 17,802	$ 11,769	--	$ 5,194	$ 2,386	--	--	$  76,954
Operating and other		(206)	--	(24,417)	(1,028)	--	(5,793)	(6,433)	--	--	(161)	$ (1,424)	$ (74)	(39,536)
Depreciation and amortization		(612)	--	(5,067)	(901)	--	(3,965)	(3,154)	--	--	(1,411)	--	--	(15,110)
Interest expense		--	--	(4,449)	(335)	--	(2,485)	(1,620)	--	--	(293)	--	--	(9,182)
Net income		$     (20)	--	$      747	$ 2,061	--	$   5,559	$    562	--	$ 5,194	$    521	$ (1,424)	$ (74)	$  13,126
Company’s equity in earnings
(loss) o f unconsolidated
joint ventures		$     (10)	--	$      301	$    649	--	--	$    (379)	--	$ 1,909	$    260	$    (437)	$ (17)	$    2,276

	Year Ended December 31, 2009
		Plaza	Ramland		Red Bank			Princeton				Boston-
		VIII & IX	Realty/	Harborside	Corporate		Gramercy	Forrestal	Route 93	Gale	12	Downtown	Gale	Combined
		Associates	Other	South Pier	Plaza I & II	M-G-G	Agreement	Village	Portfolio	Kimball	Vreeland	Crossing	Jefferson	Total
Total revenues		$    804	--	$ 35,002	$ 3,214	$ 17,582	$  7,902	$ 13,171	$  2,153	--	$ 2,579	--	--	$  82,407
Operating and other		(192)	--	(23,170)	(1,002)	(7,076)	(4,675)	(7,558)	(2,487)	$ 1,664	(62)	$ (10,881)	$ (58)	(55,497)
Depreciation and amortization		(612)	--	(4,215)	(871)	(6,493)	(3,073)	(3,948)	(1,206)	--	(1,251)	--	--	(21,669)
Interest expense		--	--	(4,592)	(340)	(4,883)	(1,862)	(1,788)	(649)	--	(467)	--	--	(14,581)
Net income		--	--	$   3,025	$ 1,001	$     (870)	$  (1,708)	$    (123)	$ (2,189)	$ 1,664	$    799	$ (10,881)	$ (58)	$   (9,340)
Company’s equity in earnings
(loss) o f unconsolidated
joint ventures		--	--	$   2,856	$    463	$     (916)	--	$    (131)	$ (4,354)	$    648	$    400	$  ( 4,500)	$ (26)	$   (5,560)

	Year Ended December 31, 2008
		Plaza	Ramland		Red Bank			Princeton				Boston-
		VIII & IX	Realty/	Harborside	Corporate		Gramercy	Forrestal	Route 93	Gale	12	Downtown	Gale	Combined
		Associates	Other	South Pier	Plaza I & II	M-G-G	Agreement	Village	Portfolio	Kimball	Vreeland	Crossing	Jefferson	Total
Total revenues		$ 1,131	$ 9,186	$ 45,783	$ 3,205	$ 51,285	--	$ 12,924	$  2,770	--	$ 2,188		--	$ 128,472
Operating and other		(183)	(1,182)	(26,746)	(906)	(52,213)	--	(8,843)	(3,716)	$      (43)	(72)	$ (34,712)	--	(128,616)
Depreciation and amortization		(614)	(481)	(4,926)	(631)	(20,433)	--	(5,454)	(1,758)	--	(511)	--	--	(34,808)
Interest expense		--	(203)	(4,682)	(792)	(17,381)	--	(3,318)	(2,443)	--	(509)	--	--	(29,328)
Net income		$    334	$ 7,320	$   9,429	$    876	$ (38,742)	--	$ (4,691)	$ (5,147)	$      (43)	$ 1,096	$ (34,712)	--	$  (64,280)
Company’s equity in earnings
(loss) o f unconsolidated
joint ventures		$    167	$      90	$   4,740	$    475	$ (32,354)	--	$    (880)	$ (1,154)	$     455	$    548	$ (11,839)	--	$  (39,752)

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5.   DEFERRED CHARGES AND OTHER ASSETS

	December 31,
(dollars in thousands)	2010	2009
Deferred leasing costs	$ 241,281	$ 229,725
Deferred financing costs	20,149	26,733
	261,430	256,458
Accumulated amortization	(120,580)	(119,267)
Deferred charges, net	140,850	137,191
In-place lease values, related intangible and other assets, net	41,155	49,180
Prepaid expenses and other assets, net	30,033	27,303
Total deferred charges and other assets, net	$ 212,038	$ 213,674

6.   RESTRICTED CASH

Restricted cash includes security deposits for certain of the Company’s properties, and escrow and reserve funds for debt service, real estate taxes, property insurance, capital improvements, tenant improvements, and leasing costs established pursuant to certain mortgage financing arrangements, and is comprised of the following:  (dollars in thousands)

	December 31,
	2010	2009
Security deposits	$   6,995	$   8,618
Escrow and other reserve funds	10,315	12,063
Total restricted cash	$ 17,310	$ 20,681

7.   DISCONTINUED OPERATIONS

On June 1, 2010, the Company disposed of its 150,050 square foot office property located at 105 Challenger Road in Ridgefield Park, New Jersey and recorded a gain on the disposal of the office property of approximately $4.4 million.  The Company has presented this property as discontinued operations in its statement of operations for all periods presented.

The following table summarizes income from discontinued operations and the related realized gains (losses) and unrealized losses on disposition of rental property, net, for the years ended December 31, 2010, 2009 and 2008:  (dollars in thousands)

	Years Ended December 31,
	2010	2009	2008
Total revenues	$  2,255	$   5,601	$  5,189
Operating and other expenses	(1,173)	(2,603)	(2,826)
Depreciation and amortization	(409)	(1,811)	(1,678)
Interest expense (net of interest income)	(431)	(1,204)	(1,196)
Income from discontinued operations before
gains (losses) and unrealized losses on
disposition of rental property	242	(17)	(511)
Impairment charge on rental property	--	(16,563)	--
Realized gains (losses) and unrealized losses on
disposition of rental property, net	4,447	--	--
Total discontinued operations, net	$  4,689	$(16,580)	$   (511)

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8.   SENIOR UNSECURED NOTES

A summary of the Company’s senior unsecured notes as of December 31, 2010 and 2009 is as follows:  (dollars in thousands)

	December 31,	December 31,	Effective
	2010	2009	Rate (1)
5.050% Senior Unsecured Notes, due April 15, 2010 (2)	--	$149,984	5.265%
7.835% Senior Unsecured Notes, due December 15, 2010 (2)	--	15,000	7.950%
7.750% Senior Unsecured Notes, due February 15, 2011 (3)	--	299,814	7.930%
5.250% Senior Unsecured Notes, due January 15, 2012	$     99,793	99,599	5.457%
6.150% Senior Unsecured Notes, due December 15, 2012	93,946	93,455	6.894%
5.820% Senior Unsecured Notes, due March 15, 2013	25,861	25,751	6.448%
4.600% Senior Unsecured Notes, due June 15, 2013	99,930	99,901	4.742%
5.125% Senior Unsecured Notes, due February 15, 2014	200,749	200,989	5.110%
5.125% Senior Unsecured Notes, due January 15, 2015	149,625	149,533	5.297%
5.800% Senior Unsecured Notes, due January 15, 2016	200,389	200,464	5.806%
7.750% Senior Unsecured Notes, due August 15, 2019	248,158	247,944	8.017%
Total Senior Unsecured Notes	$1,118,451	$1,582,434
(1)   Includes the cost of terminated treasury lock agreements (if any), offering and other transaction costs and the discount/premium on the notes, as applicable.
(2)   These notes were paid at maturity.
(3)   On December 15, 2010, the Company redeemed $300 million principal amount of its 7.75 percent senior unsecured notes due February 15, 2011.  The redemption price, including a make-whole premium, was 101.225 percent of the principal amount of the notes, plus accrued and unpaid interest up to the redemption date.  The Company funded the redemption price, including accrued and unpaid interest, of approximately $311.4 million from borrowing on its unsecured revolving credit facility, as well as cash on hand.  In connection with the redemption, the Company recorded approximately $3.8 million as a loss from early extinguishment of debt.

9.   UNSECURED REVOLVING CREDIT FACILITY

The Company has a $775 million unsecured credit facility (expandable to $800 million) with a group of 23 Lenders.  The interest rate on outstanding borrowings (not electing the Company’s competitive bid feature) is LIBOR plus 55 basis points at the BBB/Baa2 pricing level.  In June 2010, the Company exercised its option to extend the credit facility for one year to June 2012 and paid the $1,162,500 extension fee.

The facility has a competitive bid feature, which allows the Company to solicit bids from lenders under the facility to borrow up to $300 million at interest rates less than the current LIBOR plus 55 basis point spread.  The Company may also elect an interest rate representing the higher of the lender’s prime rate or the Federal Funds rate plus 50 basis points. The unsecured facility also requires a 15 basis point facility fee on the current borrowing capacity payable quarterly in arrears.

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The interest rate and the facility fee are subject to adjustment, on a sliding scale, based upon the Company’s unsecured debt ratings.  In the event of a change in the Company’s unsecured debt rating, the interest and facility fee rates will be adjusted in accordance with the following table:

Company’s	Interest Rate –
Unsecured Debt Ratings:	Applicable Basis Points	Facility Fee
S&P Moody’s/Fitch (a)	Above LIBOR	Basis Points
No ratings or less than BBB-/Baa3/BBB-	100.0	25.0
BBB-/Baa3/BBB-	75.0	20.0
BBB/Baa2/BBB (current)	55.0	15.0
BBB+/Baa1/BBB+	42.5	15.0
A-/A3/A- or higher	37.5	12.5
(a)   If the Company has debt ratings from two rating agencies, one of which is Standard & Poor’s Rating Services (“S&P”) or Moody’s Investors Service (“Moody’s”), the rates per the above table shall be based on the lower of such ratings.  If the Company has debt ratings from three rating agencies, one of which is S&P or Moody’s, the rates per the above table shall be based on the lower of the two highest ratings.  If the Company has debt ratings from only one agency, it will be considered to have no rating or less than BBB-/Baa3/BBB- per the above table.

The terms of the unsecured facility include certain restrictions and covenants which limit, among other things, the payment of dividends (as discussed below), the incurrence of additional indebtedness, the incurrence of liens and the disposition of real estate properties (to the extent that: (i) such property dispositions cause the Company to default on any of the financial ratios of the facility described below, or (ii) the property dispositions are completed while the Company is under an event of default under the facility, unless, under certain circumstances, such disposition is being carried out to cure such default), and which require compliance with financial ratios relating to the maximum leverage ratio, the maximum amount of secured indebtedness, the minimum amount of tangible net worth, the minimum amount of fixed charge cover age, the maximum amount of unsecured indebtedness, the minimum amount of unencumbered property interest coverage and certain investment limitations.  The dividend restriction referred to above provides that, if an event of default has occurred and is continuing, the Corporation will not make any excess distributions with respect to common stock or other common equity interests except to enable the Corporation to continue to qualify as a REIT under the Code.

The lending group for the credit facility consists of: JPMorgan Chase Bank, N.A., as administrative agent (the “Agent”); Bank of America, N.A., assyndication agent; Scotiabanc, Inc., Wachovia Bank, National Association; and Wells Fargo Bank, National Association, as documentation agents; SunTrust Bank, as senior managing agent; US Bank National Association, Citicorp North America, Inc.; and PNC Bank National Association, as managing agents; and Bank of China, New York Branch; The Bank of New York; Chevy Chase Bank, F.S.B.; The Royal Bank of Scotland PLC; Mizuho Corporate Bank, Ltd.; The Bank of Tokyo-Mitsubishi UFJ, Ltd. (Successor by merger to UFJ Bank Limited); North Fork Bank; Bank Hapoalim B.M.; Comeri ca Bank; Chang Hwa Commercial Bank, Ltd., New York Branch; First Commercial Bank, New York Agency; Mega International Commercial Bank Co. Ltd., New York Branch; Deutsche Bank Trust Company Americas and Hua Nan Commercial Bank, New York Agency, as participants.

As of December 31, 2010 and 2009, the Company had outstanding borrowings of $228 million and $0, respectively, under its unsecured revolving credit facility.

MONEY MARKET LOAN

The Company has an agreement with JPMorgan Chase Bank to participate in a noncommitted money market loan program (“Money Market Loan”).  The Money Market Loan is an unsecured borrowing of up to $75 million arranged by JPMorgan Chase Bank with maturities of 30 days or less.  The rate of interest on the Money Market Loan borrowing is set at the time of each borrowing.  As of December 31, 2010 and 2009, the Company had no outstanding borrowings under the Money Market Loan.

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10. MORTGAGES, LOANS PAYABLE AND OTHER OBLIGATIONS

The Company has mortgages, loans payable and other obligations which primarily consist of various loans collateralized by certain of the Company’s rental properties.  As of December 31, 2010, 32 of the Company’s properties, with a total book value of approximately $981,811,000, are encumbered by the Company’s mortgages and loans payable.  Payments on mortgages, loans payable and other obligations are generally due in monthly installments of principal and interest, or interest only.

A summary of the Company’s mortgages, loans payable and other obligations as of December 31, 2010 and 2009 is as follows: (dollars in thousands)

			Effective
				Interest	December 31,
Property Name	Lender			Rate (a)	2010		2009	Maturity
105 Challenger Road (b)	Archon Financial CMBS			6.235%	--		$  19,408	--
One Grande Commons (c)	Capital One Bank	LIBOR +2.00%			$  11,000		--	12/31/11
2200 Renaissance Boulevard (d)	Wachovia CMBS			5.888%	16,171		16,619	12/01/12
Soundview Plaza	Morgan Stanley Mortgage Capital			6.015%	16,089		16,614	01/01/13
9200 Edmonston Road	Principal Commercial Funding L.L.C.			5.534%	4,646		4,804	05/01/13
6305 Ivy Lane	John Hancock Life Insurance Co.			5.525%	6,475		6,693	01/01/14
395 West Passaic	State Farm Life Insurance Co.			6.004%	11,270		11,735	05/01/14
6301 Ivy Lane	John Hancock Life Insurance Co.			5.520%	6,103		6,297	07/01/14
35 Waterview Boulevard	Wachovia CMBS			6.348%	19,341		19,613	08/11/14
6 Becker, 85 Livingston,   75 Livingston &   20 Waterview	Wachovia CMBS			10.220%	61,224		60,409	08/11/14
4 Sylvan	Wachovia CMBS			10.190%	14,395		14,357	08/11/14
10 Independence	Wachovia CMBS			12.440%	15,606		15,339	08/11/14
4 Becker	Wachovia CMBS			9.550%	37,096		36,281	05/11/16
5 Becker	Wachovia CMBS			12.830%	11,599		11,111	05/11/16
210 Clay	Wachovia CMBS			13.420%	11,467		11,138	05/11/16
51 Imclone	Wachovia CMBS			8.390%	3,893		3,899	05/11/16
Various (e)	Prudential Insurance			6.332%	150,000		150,000	01/15/17
23 Main Street	JPMorgan CMBS			5.587%	31,537		32,042	09/01/18
Harborside Plaza 5	The Northwestern Mutual Life Insurance Co. & New York Life Insurance Co.			6.842%	234,521		237,248	11/01/18
100 Walnut Avenue	Guardian Life Insurance Co.			7.311%	19,443		19,600	02/01/19
One River Center (f)	Guardian Life Insurance Co.			7.311%	44,540		44,900	02/01/19
581 Main Street	Valley National Bank			6.935% (g)		16,627	16,896	07/01/34
Total mortgages, loans payable and other obligations					$743,043		$755,003

(a)  Reflects effective rate of debt, including deferred financing costs, comprised of the cost of terminated treasury lock agreements (if any), debt initiation costs, mark-to-market adjustment of acquired debt and other transaction costs, as applicable.

(b)  On June 1, 2010, the Company transferred the deed for 105 Challenger Road to the lender in satisfaction of its obligations.

(c)  On December 17, 2010, the Company obtained this mortgage financing in connection with obtaining a controlling interest in the mortgaged property.  The mortgage loan has three one-year extension options subject to certain conditions and the payment of a fee.

(d)  The property does not generate sufficient cash flow to meet debt service requirements.  As a result, beginning January 2011, debt service has not been made and a modification of the loan terms has been requested from the lender.

(e)  Mortgage is collateralized by seven properties.  On January 15, 2010, the Company extended the mortgage loan until January 15, 2017 at an effective interest rate of 6.33 percent.

(f)   Mortgage is collateralized by the three properties comprising One River Center.

(g)  The coupon interest rate will be reset at the end of year 10 (2019) and year 20 (2029) at 225 basis points over the 10-year treasury yield 45 days prior to the reset dates with a minimum rate of 6.875 percent.

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SCHEDULED PRINCIPAL PAYMENTS

Scheduled principal payments and related weighted average annual interest rates for the Company’s senior unsecured notes (see Note 8), unsecured revolving credit facility and mortgages, loans payable and other obligations as of December 31, 2010 are as follows: (dollars in thousands)

	Scheduled	Principal		Weighted Avg.
	Amortization	Maturities	Total	Interest Rate of
Period	($000’s)	($000’s)	($000’s)	Future Repayments (a)
2011	$    9,217	$     11,000	$    20,217	4.75%
2012	10,687	438,148	448,835	3.48%
2013	11,319	145,223	156,542	5.39%
2014	10,473	335,257	345,730	6.82%
2015	8,946	150,000	158,946	5.40%
Thereafter	35,820	952,532	988,352	7.15%
Sub-total	86,462	2,032,160	2,118,622
Adjustment for unamortized debt
discount/premium, net, as of
December 31, 2010	(29,128)	--	(29,128)	--
Totals/Weighted Average	$  57,334	$2,032,160	$2,089,494	5.97%
(a)  Actual weighted average LIBOR contract rates relating to the Company’s outstanding debt as of December 31, 2010 of 0.28 percent was used in calculating revolving credit facility and other variable rate debt interest rates.

CASH PAID FOR INTEREST AND INTEREST CAPITALIZED

Cash paid for interest for the years ended December 31, 2010, 2009 and 2008 was $153,608,000, $131,912,000, and $131,304,000, respectively.  Interest capitalized by the Company for the years ended December 31, 2010, 2009 and 2008 was $1,912,000, $1,401,000 and $5,799,000, respectively.

SUMMARY OF INDEBTEDNESS

As of December 31, 2010, the Company’s total indebtedness of $2,089,494,000 (weighted average interest rate of 5.97 percent) was comprised of $239,000,000 of revolving credit facility borrowings and other variable rate mortgage debt (weighted average rate of 0.90 percent and fixed rate debt and other obligations of $1,850,494,000 (weighted average rate of 6.62 percent).

As of December 31, 2009, the Company’s total indebtedness of $2,337,437,000 (weighted average interest rate of 6.61 percent) was comprised of all fixed rate debt.

11.   MACK-CALI REALTY, L.P.’S PARTNERS’ CAPITAL

COMPANY

Partners’ Capital in the accompanying consolidated financial statements relates to (a) General Partners’ capital consisting of common units and Series C preferred units (“Preferred Units”) in the Company, and (b) Limited Partners’ capital consisting of common units held by the limited partners.

Any transactions resulting in the issuance of additional common and preferred stock of the Corporation result in a corresponding issuance by the Company of an equivalent amount of common and preferred units to the Corporation.

GENERAL PARTNERS’ CAPITAL

PREFERRED STOCK

The Corporation has 10,000 shares of eight-percent Series C cumulative redeemable perpetual preferred stock issued and outstanding (“Series C Preferred Stock”) in the form of 1,000,000 depositary shares ($25 stated value per depositary share).  Each depositary share represents 1/100th of a share of Series C Preferred Stock.

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The Series C Preferred Stock has preference rights with respect to liquidation and distributions over the common stock.  Holders of the Series C Preferred Stock, except under certain limited conditions, will not be entitled to vote on any matters.  In the event of a cumulative arrearage equal to six quarterly dividends, holders of the Series C Preferred Stock will have the right to elect two additional members to serve on the Corporation’s Board of Directors until dividends have been paid in full.  At December 31, 2010, there were no dividends in arrears.  The Corporation may issue unlimited additional preferred stock ranking on a parity with the Series C Preferred Stock but may not issue any preferred stock senior to the Series C Preferred Stock without the consent of two-thirds of its hol ders.  The Series C Preferred Stock is essentially on an equivalent basis in priority with the Preferred Units.

The Series C Preferred Stock is redeemable at the option of the Corporation, in whole or in part, at $25 per depositary share, plus accrued and unpaid dividends.

PREFERRED UNITS

In connection with the Corporation’s issuance of $25 million of Series C cumulative redeemable perpetual preferred stock, the Corporation acquired from the Company $25 million of Series C Preferred Units (the “Series C Preferred Units”), which have terms essentially identical to the Series C preferred stock.

REPURCHASE OF GENERAL PARTNERS’ UNITS

On September 12, 2007, the Corporation’s Board of Directors authorized an increase to the Corporation’s repurchase program under which the Corporation was permitted to purchase up to $150 million of the Corporation’s outstanding common stock (“Repurchase Program”).  The Corporation has purchased and retired 2,893,630 shares of its outstanding common stock for an aggregate cost of approximately $104 million through December 31, 2010 under the Repurchase Program (none of which has occurred in 2009 and 2010).  Concurrent with these purchases, the Corporation sold to the Company 2,893,630 common units for approximately $104 million. The Corporation has a remaining authorization to repurchase up to an additional $46 million of its outstanding common stock, which it may repurchase from time t o time in open market transactions at prevailing prices or through privately negotiated transactions.

DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN

The Corporation has a Dividend Reinvestment and Stock Purchase Plan (the “DRIP”) which commenced in March 1999 under which 5.5 million shares of the Corporation’s common stock have been reserved for future issuance.  The DRIP provides for automatic reinvestment of all or a portion of a participant’s dividends from the Corporation’s shares of common stock.  The DRIP also permits participants to make optional cash investments up to $5,000 a month without restriction and, if the Corporation waives this limit, for additional amounts subject to certain restrictions and other conditions set forth in the DRIP prospectus filed as part of the Corporation’s effective registration statement on Form S-3 filed with the Securities and Exchange Commission (“SEC”) for the 5.5 million shares of the Corporation’s common stock reserved for issuance under the DRIP.

STOCK OPTION PLANS

In May 2004, the Corporation established the 2004 Incentive Stock Plan under which a total of 2,500,000 shares have been reserved for issuance.  No options have been granted through December 31, 2010 under this plan.  In September 2000, the Corporation established the 2000 Employee Stock Option Plan (“2000 Employee Plan”) and the Amended and Restated 2000 Director Stock Option Plan (“2000 Director Plan”).  In May 2002, shareholders of the Corporation approved amendments to both plans to increase the total shares reserved for issuance under both of the 2000 plans from 2,700,000 to 4,350,000 shares of the Corporation’s common stock (from 2,500,000 to 4,000,000 shares under the 2000 Employee Plan and from 200,000 to 350,000 shares under the 2000 Director Plan).  In 1994, and as subsequently amended, the Corporation established the Mack-Cali Employee Stock Option Plan (“Employee Plan”) and the Mack-Cali Director Stock Option Plan (“Director Plan”) under which a total of 5,380,188 shares (subject to adjustment) of the Corporation’s common stock had been reserved for issuance (4,980,188 shares under the Employee Plan and 400,000 shares under the Director Plan).  As the Employee Plan and Director Plan expired in 2004, and the 2000 Employee Plan and 2000 Director Plan expired in September 2010, stock options may no longer be issued under those plans.  Stock options granted under the Employee Plan in 1994 and 1995 became exercisable over a three-year period.  Stock options granted under the 2000 Employee Plan and those options granted subsequent to 1995 under the Employee Plan became exercisable over a five-year period.  All stock options granted under both the 2000 Director Plan and Director Plan became exercisable in one year.  All options were granted at the fair market value at the dates of grant and have terms of ten years.  As of December 31, 2010 and 2009, the stock options outstanding, which were all exercisable, had a weighted average remaining contractual life of approximately 1.7 and 2.5 years, respectively.

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Information regarding the Corporation’s stock option plans is summarized below:

		Weighted	Aggregate
	Shares	Average	Intrinsic
	Under	Exercise	Value
	Options	Price	$(000’s)
Outstanding at January 1, 2008	497,731	$29.03
Exercised	(81,675)	$28.30
Lapsed or canceled	(20,515)	$37.00
Outstanding at December 31, 2008	395,541	$28.77	$(1,689)
Exercised	(18,917)	$26.66
Lapsed or canceled	(24,440)	$30.89
Outstanding at December 31, 2009 ($26.25 – $45.47)	352,184	$28.74
Exercised	(55,508)	$27.10
Lapsed or canceled	(1,000)	$26.75
Outstanding at December 31, 2010 ($26.31 – $45.47)	295,676	$29.05	$ 1,186
Options exercisable at December 31, 2009	352,184		$ 2,055
Options exercisable at December 31, 2010	295,676		$ 1,186
Available for grant at December 31, 2009	3,824,270
Available for grant at December 31, 2010	2,425,073

Cash received from options exercised under all stock option plans was $1.5 million, $504,000 and $2.3 million for the years ended December 31, 2010, 2009 and 2008 respectively.  The total intrinsic value of options exercised during the years ended December 31, 2010, 2009 and 2008 was $349,000, $123,000 and $832,000, respectively.  The Corporation has a policy of issuing new shares to satisfy stock option exercises.

The Company recognized no stock options expense for the years ended December 31, 2010, 2009 and 2008, respectively. As of December 31, 2010, the Company had $4.3 million of total unrecognized compensation cost related to unvested stock compensation granted under the Corporation’s stock compensation plans.  That cost is expected to be recognized over a weighted average period of 1.8 years.

STOCK COMPENSATION

The Corporation has issued stock awards (“Restricted Stock Awards”) to officers, certain other employees, and nonemployee members of the Board of Directors of the Corporation, which allow the holders to each receive a certain amount of shares of the Corporation’s common stock generally over a one to seven-year vesting period, of which 239,759 unvested shares were outstanding at December 31, 2010.  Of the outstanding Restricted Stock Awards issued to executive officers and senior management, 137,932 are contingent upon the Corporation meeting certain performance goals to be set by the Executive Compensation and Option Committee of the Board of Directors of the Corporation each year, with the remaining based on time and service. All Restricted Stock Awards provided to the officers and certain other employees w ere issued under the 2004 Incentive Stock Plan, 2000 Employee Plan and the Employee Plan. Restricted Stock Awards provided to directors were issued under the 2004 Incentive Stock Plan and the 2000 Director Plan.

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Information regarding the Restricted Stock Awards is summarized below:

		Weighted-Average
		Grant – Date
	Shares	Fair Value
Outstanding at January 1, 2008	170,811	$  35.32
Granted (a)	374,529	$  30.72
Vested	(168,634)	$  27.01
Forfeited	(1,700)	$  35.13
Outstanding at December 31, 2008	375,006	$  34.46
Granted (b)	83,337	$  32.27
Vested	(132,255)	$  27.55
Forfeited	(3,000)	$  49.61
Outstanding at December 31, 2009	323,088	$  36.58
Granted (c)	111,127	$  32.10
Vested	(170,978)	$  34.74
Forfeited	(23,478)	$  35.70
Outstanding at December 31, 2010	239,759	$  35.90
(a)  Included in the 374,529 Restricted Stock Awards granted in 2008 were 322,609 awards granted to the Corporation’s five executive officers, Mitchell E. Hersh, Barry Lefkowitz, Roger W. Thomas, Michael Grossman and Mark Yeager.
(b)  Included in the 83,337 Restricted Stock Awards granted in 2009 were 61,667 awards granted to the Corporation’s five executive officers, Mitchell E. Hersh, Barry Lefkowitz, Roger W. Thomas, Michael Grossman and Mark Yeager.
(c)  Included in the 111,127 Restricted Stock Awards granted in 2010 were 51,970 awards granted to the Corporation’s four executive officers, Mitchell E. Hersh, Barry Lefkowitz, Roger W. Thomas and Michael Grossman.

DEFERRED STOCK COMPENSATION PLAN FOR DIRECTORS

The Amended and Restated Deferred Compensation Plan for Directors, which commenced January 1, 1999, allows non-employee directors of the Corporation to elect to defer up to 100 percent of their annual retainer fee into deferred stock units.  The deferred stock units are convertible into an equal number of shares of common stock upon the directors’ termination of service from the Board of Directors or a change in control of the Corporation, as defined in the plan.  Deferred stock units are credited to each director quarterly using the closing price of the Corporation’s common stock on the applicable dividend record date for the respective quarter.  Each participating director’s account is also credited for an equivalent amount of deferred stock units based on the dividend rate for each qua rter.

During the years ended December 31, 2010, 2009 and 2008, 12,563, 15,082 and 12,889 deferred stock units were earned, respectively.  As of December 31, 2010 and 2009, there were 84,236 and 71,848 director stock units outstanding, respectively.

LIMITED PARTNERS’ CAPITAL

Common Units

Certain individuals and entities own common units in the Company.  A common unit and a share of Common Stock of the Corporation have substantially the same economic characteristics in as much as they effectively share equally in the net income or loss of the Company.  Common unitholders (other than the General Partner) have the right to redeem their common units, subject to certain restrictions.  The redemption is required to be satisfied in shares of Common Stock of the General Partner, cash, or a combination thereof, calculated as follows:  one share of the General Partner’s Common Stock, or cash equal to the fair market value of a share of the General Partner’s Common Stock at the time of redemption, for each common unit.  The Company, in its sole discretion, determines t he form of redemption of common units (i.e., whether a common unitholder receives Common Stock, cash, or any combination thereof).  If the Company elects to satisfy the redemption with shares of Common Stock of the General Partner as opposed to cash, the General Partner is obligated to issue shares of its Common Stock to the redeeming unitholder.  Regardless of the rights described above, the common unitholders may not put their units for cash to the Company or the General Partner under any circumstances.

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Unit Transactions

As of December 31, 2010, 2009 and 2008, the Company had 13,007,668, 13,495,036 and 14,437,731 common units outstanding, respectively.

EARNINGS PER UNIT

Basic EPU excludes dilution and is computed by dividing net income available to common unitholders by the weighted average number of units outstanding for the period.  Diluted EPU reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock.

The following information presents the Company’s results for the years ended December 31, 2010, 2009 and 2008 in accordance with ASC 260, Earning Per Unit:  (dollars in thousands)

	Year Ended December 31,
Computation of Basic EPU	2010			2009			2008
Income from continuing operations	$	58,750		$	80,308		$	65,390
Add:         Noncontrolling interest in consolidated joint ventures		262			943			664
Deduct:  Preferred unit distributions		(2,000	)		(2,000	)		(2,000	)
Income from continuing operations available to common unitholders		57,012			79,251			64,054
Income (loss) from discontinued operations available to common
unitholders		4,689			(16,580	)		(511	)
Net income available to common unitholders		61,701			62,671		$	63,543
Weighted average common units		92,373			88,346			80,404
Basic EPU:
Income from continuing operations available to common unitholders	$	0.62		$	0.90		$	0.79
Income (loss) from discontinued operations available to common
unitholders		0.05			(0.19	)		--
Net income available to common unitholders	$	0.67		$	0.71		$	0.79

	Year Ended December 31,
Computation of Diluted EPU	2010		2009			2008
Income from continuing operations available to common unitholders	$	57,012	$	79,251		$	64,054
Income (loss) from discontinued operations for diluted earnings
per unit		4,689		(16,580	)		(511	)
Net income available to common unitholders	$	61,701	$	62,671		$	63,543
Weighted average common units		92,477		88,389			80,648
Diluted EPU:
Income from continuing operations available to common unitholders	$	0.62	$	0.90		$	0.79
Income (loss) from discontinued operations available to common
unitholders		0.05		(0.19	)		--
Net income available to common unitholders	$	0.67	$	0.71		$	0.79

The following schedule reconciles the units used in the basic EPU calculation to the units used in the diluted EPU calculation:

	Year Ended December 31,
	2010		2009		2008
Basic EPU units		92,373		88,346		80,404
Add:   Stock options		44		1		95
Restricted Stock Awards		60		42		149
Diluted EPU Units		92,477		88,389		80,648

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Not included in the computations of diluted EPU were 15,000, 307,184 and 10,000 stock options as such securities were anti-dilutive during the years ended December 31, 2010, 2009 and 2008, respectively.  Unvested restricted stock outstanding as of December 31, 2010, 2009 and 2008 were 239,759, 323,088 and 375,006, respectively.

The following are distributions declared for Common Units for the years ended December 31, 2010, 2009 and 2008.

	Year Ended December 31,
	2010	2009	2008
Distributions declared per common unit	$1.80	$1.80	$2.56

12.   CONSOLIDATED JOINT VENTURES

The Company has ownership interests in certain joint ventures which it consolidates.  Various entities and/or individuals hold noncontrolling interests in these ventures.

13.   EMPLOYEE BENEFIT 401(k) PLANS

Employees of the Corporation, who meet certain minimum age and service requirements, are eligible to participate in the Mack-Cali Realty Corporation 401(k) Savings/Retirement Plan (the “401(k) Plan”).  Eligible employees may elect to defer from one percent up to 60 percent of their annual compensation on a pre-tax basis to the 401(k) Plan, subject to certain limitations imposed by federal law.  The amounts contributed by employees are immediately vested and non-forfeitable.  The Corporation may make discretionary matching or profit sharing contributions to the 401(k) Plan on behalf of eligible participants in any plan year.  Participants are always 100 percent vested in their pre-tax contributions and will begin vesting in any matching or profit sharing contributions made on their beh alf after two years of service with the Corporation at a rate of 20 percent per year, becoming 100 percent vested after a total of six years of service with the Corporation.  All contributions are allocated as a percentage of compensation of the eligible participants for the Plan year.  The assets of the 401(k) Plan are held in trust and a separate account is established for each participant.  A participant may receive a distribution of his or her vested account balance in the 401(k) Plan in a single sum or in installment payments upon his or her termination of service with the Corporation.  Total expense recognized by the Company for the 401(k) Plan for each of the three years ended December 31, 2010, 2009 and 2008 was $0, $0 and $471,000, respectively. The Company did not make contributions to the 401(k) Plan in 2010 and 2009.

14.   DISCLOSURE OF FAIR VALUE OF FINANCIAL INSTRUMENTS

The following disclosure of estimated fair value was determined by management using available market information and appropriate valuation methodologies.  However, considerable judgment is necessary to interpret market data and develop estimated fair value.  Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company could realize on disposition of the financial instruments at December 31, 2010 and 2009.  The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts.

Cash equivalents, marketable securities, receivables, accounts payable, and accrued expenses and other liabilities are carried at amounts which reasonably approximate their fair values as of December 31, 2010 and 2009.

The fair value of the Company’s long-term debt, consisting of senior unsecured notes, an unsecured revolving credit facility and mortgages, loans payable and other obligations aggregate approximately $2.2 billion and $2.4 billion as compared to the book value of approximately $2.1 billion and $2.3 billion as of December 31, 2010 and 2009, respectively.  The fair value of the Company’s long-term debt is estimated on a level 2 basis (as provided by ASC 820, Fair Value Measurements and Disclosures), using a discounted cash flow analysis based on the borrowing rates currently available to the Company for loans with similar terms and maturities.  The fair value of the mortgage debt and the unsecured notes was determined by discounting the future contractual interest and principal payments by a market rate.

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Disclosure about fair value of financial instruments is based on pertinent information available to management as of December 31, 2010 and 2009.  Although management is not aware of any factors that would significantly affect the fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since December 31, 2010 and current estimates of fair value may differ significantly from the amounts presented herein.

15.   COMMITMENTS AND CONTINGENCIES

TAX ABATEMENT AGREEMENTS

Pursuant to agreements with the City of Jersey City, New Jersey, the Company is required to make payments in lieu of property taxes (“PILOT”) on certain of its properties located in Jersey City, as follows:

The Harborside Plaza 4-A agreement, which commenced in 2002, is for a term of 20 years.  The PILOT is equal to two percent of Total Project costs, as defined.  Total Project costs, as defined, are $49.5 million.  The PILOT totaled $1,205,000, $1,001,000 and $1,001,000 for the years ended December 31, 2010, 2009 and 2008, respectively.

The Harborside Plaza 5 agreement, as amended, which commenced in 2002 upon substantial completion of the property, as defined, is for a term of 20 years.  The PILOT is equal to two percent of Total Project Costs.  Total Project Costs, as defined, are $170.9 million.  The PILOT totaled $3.8 million, $3.2 million and $3.2 million for the years ended December 31, 2010, 2009 and 2008, respectively.

At the conclusion of the above-referenced PILOT agreements, it is expected that the properties will be assessed by the municipality and be subject to real estate taxes at the then prevailing rates.

LITIGATION

The Company is a defendant in litigation arising in the normal course of its business activities.  Management does not believe that the ultimate resolution of these matters will have a materially adverse effect upon the Company’s financial condition taken as whole.

GROUND LEASE AGREEMENTS

Future minimum rental payments under the terms of all non-cancelable ground leases under which the Company is the lessee, as of December 31, 2010, are as follows: (dollars in thousands)

Year	Amount
2011	$    375
2012	367
2013	351
2014	367
2015	371
2016 through 2084	16,688
Total	$18,519

Ground lease expense incurred by the Company during the years ended December 31, 2010, 2009 and 2008 amounted to $490,000, $734,000 and $701,000, respectively.

OTHER

The Company may not dispose of or distribute certain of its properties, currently comprising seven properties with an aggregate net book value of approximately $133.9 million, which were originally contributed by certain unrelated common unitholders, without the express written consent of such common unitholders, as applicable, except in a manner which does not result in recognition of any built-in-gain (which may result in an income tax liability) or which reimburses the appropriate specific common unitholders for the tax consequences of the recognition of such built-in-gains (collectively, the “Property Lock-Ups”).  The aforementioned restrictions do not apply in the event that the Company sells all of its properties or in connection with a sale transaction which the Corporation’s Board of Directors determ ines is reasonably necessary to satisfy a material monetary default on any unsecured debt, judgment or liability of the Company or to cure any material monetary default on any mortgage secured by a property.  The Property Lock-Ups expire periodically through 2016.  Upon the expiration of the Property Lock-Ups, the Company is generally required to use commercially reasonable efforts to prevent any sale, transfer or other disposition of the subject properties from resulting in the recognition of built-in gain to the specific common unitholders, which include members of the Mack Group (which includes William L. Mack, Chairman of the Corporation’s Board of Directors; David S. Mack, director of the Corporation; Earle I. Mack, a former director of the Corporation; and Mitchell E. Hersh, president, chief executive officer and director of the Corporation), the Robert Martin Group (which includes Robert F. Weinberg, director of the Corporation; Martin S. Berger, a former director o f the Corporation; and Timothy M. Jones, former president of the Corporation), the Cali Group (which includes John R. Cali, director of the Corporation, and John J. Cali, a former director of the Corporation).  130 of the Company’s properties, with an aggregate net book value of approximately $1.8 billion, have lapsed restrictions and are subject to these conditions.

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Sanofi-Aventis U.S. Inc. (“Sanofi”), which occupies neighboring buildings in Bridgewater, New Jersey, exercised its option to cause the Company to construct a building on its vacant, developable land and has signed a lease for the building.  The lease has a term of 15 years, subject to three five-year extension options.  The construction of the 205,000 square foot building commenced in 2009 and was delivered to the tenant in January 2011.  The total estimated costs of the project are expected to be approximately $50.9 million (of which the Company has incurred $38.0 million through December 31, 2010.)

16.   TENANT LEASES

The Properties are leased to tenants under operating leases with various expiration dates through 2030.  Substantially all of the leases provide for annual base rents plus recoveries and escalation charges based upon the tenant’s proportionate share of and/or increases in real estate taxes and certain operating costs, as defined, and the pass-through of charges for electrical usage.

Future minimum rentals to be received under non-cancelable operating leases at December 31, 2010 are as follows (dollars in thousands):

Year	Amount
2011	$584,959
2012	536,151
2013	457,869
2014	388,291
2015	321,026
2016 and thereafter	1,064,569
Total	$3,352,865

17.   SEGMENT REPORTING

The Company operates in two business segments: (i) real estate and (ii) construction services.  The Company provides leasing, property and facilities management, acquisition, development, construction and tenant-related services for its portfolio.  In May 2006, in conjunction with the Company’s acquisition of the Gale Company and related businesses, the Company acquired a business specializing solely in construction and related services whose operations comprise the Company’s construction services segment.  The Company had no revenues from foreign countries recorded for the years ended December 31, 2010, 2009 and 2008.  The Company had no long lived assets in foreign locations as of December 31, 2010, 2009 and 2008.  The accounting policies of the segments are the same as those described in Note 2: Significant Accounting Policies, excluding depreciation and amortization.

The Company evaluates performance based upon net operating income from the combined properties in the real estate segment and net operating income from its construction services segment.

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Selected results of operations for the years ended December 31, 2010, 2009 and 2008 and selected asset information as of December 31, 2010 and 2009 regarding the Company’s operating segments are as follows: (dollars in thousands)

	Real Estate	Construction Services	Corporate & Other (d)	Total Company
Total revenues:
2010	$   726,394	$63,703	$    (2,617)	$   787,480
2009	733,287	31,207	(5,569)	758,925
2008	728,970	58,105	(14,295)	772,780
Total operating and interest expenses (a):
2010	$   284,694	$63,141	$ 178,730	$   526,565	(e)
2009	270,906	31,816	171,296	474,018	(f)
2008	265,476	56,629	162,110	484,215	(g)
Equity in earnings (loss) of unconsolidated
joint ventures:
2010	$       2,276	--	--	$       2,276
2009	(5,560)	--	--	(5,560)
2008	(39,752)	--	--	(39,752)
Net operating income (loss) (b):
2010	$   443,976	$     562	$(181,347)	$   263,191	(e)
2009	456,821	(609)	(176,865)	279,347	(f)
2008	423,742	1,476	(176,405)	248,813	(g)
Total assets:
2010	$4,332,408	$13,929	$   16,129	$4,362,466
2009	4,512,974	$12,015	196,648	4,721,637
Total long-lived assets (c):
2010	$4,096,242	--	$     2,630	$4,098,872
2009	4,189,276	--	(1,142)	4,188,134

(a) Total operating and interest expenses represent the sum of:  real estate taxes; utilities; operating services; direct construction costs; real estate services salaries, wages and other costs; general and administrative and interest expense (net of interest income). All interest expense, net of interest income, (including for property-level mortgages) is excluded from segment amounts and classified in Corporate & Other for all periods.

(b) Net operating income represents total revenues less total operating and interest expenses [as defined in Note (a)], plus equity in earnings (loss) of unconsolidated joint ventures, for the period.

(c) Long-lived assets are comprised of net investment in rental property, unbilled rents receivable and investments in unconsolidated joint ventures.

(d) Corporate & Other represents all corporate-level items (including interest and other investment income, interest expense and non-property general and administrative expense) as well as intercompany eliminations necessary to reconcile to consolidated Company totals.

(e) Excludes $191,168 of depreciation and amortization and $9,521 of impairment charge on rental property.

(f) Excludes $200,732 of depreciation and amortization.

(g)   Excludes $192,957 of depreciation and amortization.

100

18.   RELATED PARTY TRANSACTIONS

William L. Mack, Chairman of the Board of Directors of the Corporation, David S. Mack, a director of the Corporation, and Earle I. Mack, a former director of the Corporation, are the executive officers, directors and stockholders of a corporation that leases approximately 7,801 square feet at one of the Company’s office properties, which is scheduled to expire in November 2011.  The Company has recognized $250,000, $255,000 and $258,000 in revenue under this lease for the years ended December 31, 2010, 2009 and 2008, respectively, and had $0 accounts receivable from the corporation as of December 31, 2010 and 2009.

The Company has conducted business with certain entities (“RMC Entity” or “RMC Entities”), whose principals include Timothy M. Jones (a former president of the Corporation), Martin S. Berger (former member of the Corporation’s Board of Directors) and Robert F. Weinberg (current member of the Corporation’s Board of Directors).  In connection with the Company’s acquisition of 65 Class A properties from The Robert Martin Company (“Robert Martin”) on January 31, 1997, as subsequently modified, the Company granted Robert Martin the right to designate one seat on the Corporation’s Board of Directors (“RM Board Seat”), which right has since expired.  The RM Board Seat had historically been shared between Robert F. Weinberg and Martin S. Berger, each of whom had agreed that, for so long as either of them serves on the Board of Directors, that such board seat would be rotated among Mr. Berger and Mr. Weinberg annually at the time of each annual meeting of stockholders.  At the Corporation’s 2003 annual meeting of stockholders, Mr. Berger was elected to the Board of Directors and he continued to share his board seat with Mr. Weinberg.  At the Corporation’s 2006 annual meeting of stockholders, Mr. Weinberg was elected to the Board of Directors and he continued to share his board seat with Mr. Berger.  At the Corporation’s 2009 annual meeting of stockholders, Mr. Berger was elected to the Board of Directors and he continues to share his board seat with Mr. Weinberg.  The business that the Company has conducted with RMC Entities was as follows:

(1)   The Company provides management, leasing and construction-related services to properties in which RMC Entities have an ownership interest.  The Company recognized approximately $1.4 million, $1.6 million and $2.5 million in revenue from RMC Entities for the years ended December 31, 2010, 2009 and 2008, respectively.  As of December 31, 2010 and 2009, respectively, the Company had $75,000 and $0 in accounts receivable from RMC Entities.

(2)   An RMC Entity leases space at one of the Company’s office properties for approximately 4,860 square feet on a month-to-month basis.  The Company has recognized $137,000, $140,000 and $133,000, in revenue under this lease for the years ended December 31, 2010, 2009 and 2008, respectively, and had $0 and $500 accounts receivable due from the RMC Entity, as of December 31, 2010 and 2009, respectively.

The Company provides administrative support and related services to John J. Cali, who served as the Chairman Emeritus and a Board member of the Corporation, for which it was reimbursed $101,000, $115,000 and $153,000 from Mr. Cali for the years ended December 31, 2010, 2009 and 2008, respectively.  An affiliate of Mr. Cali has leases  totaling 2,631 square feet of space at one of the Company’s office properties, which are scheduled to expire at the end of 2011.  The Company recognized approximately $68,000, $68,000 and $67,000 in total revenue under the leases for the years ended December 31, 2010, 2009 and 2008, respectively, and had $17,000 and $0 in accounts receivable from the affiliate as of December 31, 2010 and 2009.

101

19.   IMPACT OF RECENTLY-ISSUED ACCOUNTING STANDARDS

FASB Accounting Standards Update No. 2010-02, Consolidation (Topic 810), Accounting and Reporting for Decreases in Ownership of a Subsidiary—a Scope Clarification

The objective of this Update is to address implementation issues related to the changes in ownership provisions in the Consolidation—Overall Subtopic (Subtopic 810-10) of the FASB Accounting Standards Codification™, originally issued as FASB Statement No. 160, Noncontrolling Interests in Consolidated Financial Statements.  Subtopic 810-10 establishes the accounting and reporting guidance for noncontrolling interests and changes in ownership interests of a subsidiary.  An entity is required to deconsolidate a subsidiary when the entity ceases to have a controlling financial interest in the subsidiary.  Upon deconsolidation of a subsidiary, an entity recognizes a gain or loss on the t ransaction and measures any retained investment in the subsidiary at fair value.  The gain or loss includes any gain or loss associated with the difference between the fair value of the retained investment in the subsidiary and its carrying amount at the date the subsidiary is deconsolidated. In contrast, an entity is required to account for a decrease in its ownership interest of a subsidiary that does not result in a change of control of the subsidiary as an equity transaction.

This Update provides amendments to Subtopic 810-10 and related guidance within U.S. GAAP to clarify that the scope of the decrease in ownership provisions of the Subtopic and related guidance applies to the following:

1.   A subsidiary or group of assets that is a business or nonprofit activity

2.   A subsidiary that is a business or nonprofit activity that is transferred to an equity method investee or joint venture

3.   An exchange of a group of assets that constitutes a business or nonprofit activity for a noncontrolling interest in an entity (including an equity method investee or joint venture).  

The amendments in this Update also clarify that the decrease in ownership guidance in Subtopic 810-10 does not apply to the following transactions even if they involve businesses:

1.   Sales of in substance real estate. Entities should apply the sale of real estate guidance in Subtopics 360-20 (Property, Plant, and Equipment) and 976-605 (Retail/Land) to such transactions.

2.   Conveyances of oil and gas mineral rights. Entities should apply the mineral property conveyance and related transactions guidance in Subtopic 932-360 (Oil and Gas—Property, Plant, and Equipment) to such transactions.

If a decrease in ownership occurs in a subsidiary that is not a business or nonprofit activity, an entity first needs to consider whether the substance of the transaction causing the decrease in ownership is addressed in other U.S. GAAP, such as transfers of financial assets, revenue recognition, exchanges of nonmonetary assets, sales of in substance real estate, or conveyances of oil and gas mineral rights, and apply that guidance as applicable.  If no other guidance exists, an entity should apply the guidance in Subtopic 810-10.  

The amendments in this Update expand the disclosures about the deconsolidation of a subsidiary or derecognition of a group of assets within the scope of Subtopic 810-10. In addition to existing disclosures, an entity should disclose the following for such a deconsolidation or derecognition:

1.   The valuation techniques used to measure the fair value of any retained investment in the former subsidiary or group of assets and information that enables users of its financial statements to assess the inputs used to develop the measurement

2.   The nature of continuing involvement with the subsidiary or entity acquiring the group of assets after it has been deconsolidated or derecognized

102

3.   Whether the transaction that resulted in the deconsolidation of the subsidiary or the derecognition of the group of assets was with a related party or whether the former subsidiary or entity acquiring the group of assets will be a related party after deconsolidation.

An entity also should disclose the valuation techniques used to measure an equity interest in an acquiree held by the entity immediately before the acquisition date in a business combination achieved in stages.

The amendments in this Update are effective beginning in the period that an entity adopts Statement 160 (now included in Subtopic 810-10).  If an entity has previously adopted Statement 160 as of the date the amendments in this Update are included in the Accounting Standards Codification, the amendments in this Update are effective beginning in the first interim or annual reporting period ending on or after December 15, 2009. The amendments in this Update should be applied retrospectively to the first period that an entity adopted Statement 160.   The adoption of this Update did not have a material impact on the Company’s financial position, results of operations and disclosures contained in its financial statements.

103

20.   CONDENSED QUARTERLY FINANCIAL INFORMATION (unaudited)

The following summarizes the condensed quarterly financial information for the Company: (dollars in thousands)

Quarter Ended 2010	December 31	September 30	June 30	March 31
Total revenues	$192,156	$197,956	$202,785	$194,583
Operating and other expenses	67,913	73,089	70,394	70,668
Direct construction costs	12,667	15,884	21,411	10,293
General and administrative	8,939	8,992	8,658	8,414
Depreciation and amortization	47,226	47,978	47,474	48,490
Impairment charge on rental property	9,521	--	--	--
Total expenses	146,266	145,943	147,937	137,865
Operating Income	45,890	52,013	54,848	56,718
Interest expense	(35,982)	(36,941)	(37,335)	(39,071)
Interest and other investment income	13	34	18	21
Equity in earnings (loss) of unconsolidated
joint ventures	2,063	475	260	(522)
Loss from early extinguishment of debt	(3,752)	--	--	--
Gain on reduction of other obligations	--	--	--	--
Total other (expense) income	(37,658)	(36,432)	(37,057)	(39,572)
Income (loss) from continuing operations	8,232	15,581	17,791	17,146
Discontinued operations:
Income (loss) from discontinued operations	--	--	11	231
Realized gains (losses) and unrealized losses
on disposition of rental property, net	--	--	4,447	--
Total discontinued operations, net	--	--	4,458	231
Net income (loss)	8,232	15,581	22,249	17,377
Noncontrolling interest in consolidated joint ventures	(19)	108	86	87
Preferred unit distributions	(500)	(500)	(500)	(500)
Net income (loss) available to common unitholders	$    7,713	$  15,189	$  21,835	$  16,964
Basic earnings per common unit:
Income (loss) from continuing operations	$      0.09	$      0.16	$      0.19	$      0.18
Discontinued operations	--	--	0.05	--
Net income (loss) available to common unitholders	$      0.09	$      0.16	$      0.24	$      0.18
Diluted earnings per common unit:
Income (loss) from continuing operations	$      0.09	$      0.16	$      0.19	$      0.18
Discontinued operations	--	--	0.05	--
Net income (loss) available to common unitholders	$      0.09	$      0.16	$      0.24	$      0.18
Distributions declared per common unit	$      0.45	$      0.45	$      0.45	$      0.45

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Quarter Ended 2009	December 31	September 30	June 30	March 31
Total revenues	$ 193,669	$ 192,147	$ 187,823	$ 185,286
Operating and other expenses	70,950	65,989	65,868	71,611
Direct construction costs	4,976	7,337	4,296	3,714
General and administrative	9,255	9,816	10,651	10,057
Depreciation and amortization	52,272	51,377	49,240	47,843
Impairment charge on rental property	--	--	--	--
Total expenses	137,453	134,519	130,055	133,225
Operating Income	56,216	57,628	57,768	52,061
Interest expense	(38,623)	(35,744)	(33,205)	(32,496)
Interest and other investment income	21	166	187	196
Equity in earnings (loss) of unconsolidated
joint ventures	841	635	(1,922)	(5,114)
Gain on sale of investment in marketable securities	--	--	--	--
Gain on reduction of other obligations	--	--	1,693	--
Total other (expense) income	(37,761)	(34,943)	(33,247)	(37,414)
Income (loss) from continuing operations	18,455	22,685	24,521	14,647
Discontinued operations:
Income (loss) from discontinued operations	(175)	104	104	(50)
Realized gains (losses) and unrealized losses
on disposition of rental property, net	(16,563)	--	--	--
Total discontinued operations, net	(16,738)	104	104	(50)
Net income (loss)	1,717	22,789	24,625	14,597
Noncontrolling interest in consolidated joint ventures	(37)	213	135	632
Preferred unit distributions	(500)	(500)	(500)	(500)
Net income (loss) available to common unitholders	$     1,180	$   22,502	$   24,260	$   14,729
Basic earnings per common unit:
Income (loss) from continuing operations	$       0.20	$       0.24	$       0.28	$       0.18
Discontinued operations	(0.19)	--	--	--
Net income (loss) available to common unitholders	$       0.01	$       0.24	$       0.28	$       0.18
Diluted earnings per common unit:
Income (loss) from continuing operations	$       0.20	$       0.24	$       0.28	$       0.18
Discontinued operations	(0.19)	--	--	--
Net income (loss) available to common unitholders	$       0.01	$       0.24	$       0.28	$       0.18
Distributions declared per common unit	$       0.45	$       0.45	$       0.45	$       0.45

105

MACK-CALI REALTY, L.P.
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2010
(dollars in thousands)
											SCHEDULE III
								Gross Amount at Which
							Costs	Carried at Close of
					Initial Costs		Capitalized		Period (a)
	Year		Related			Building and	Subsequent			Building and		Accumulated
Property Location (b)	Built	Acquired	Encumbrances	Land		Improvements	to Acquisition	Land		Improvements	Total	Depreciation (c)
NEW JERSEY
Bergen County
Fair Lawn
17-17 Rte 208 North (O)	1987	1995	--	$    3,067		$    19,415	$     3,368	$    3,067		$    22,783	$     25,850	$      8,317
Fort Lee
One Bridge Plaza (O)	1981	1996	--	2,439		24,462	6,107	2,439		30,569	33,008	10,520
2115 Linwood Avenue (O)	1981	1998	--	474		4,419	4,473	474		8,892	9,366	2,453
Little Ferry
200 Riser Road (O)	1974	1997	--	3,888		15,551	769	3,888		16,320	20,208	5,626
Lyndhurst
210 Clay Avenue (O)	1978	2009	$   11,467	2,300		11,189	(1)	2,300		11,188	13,488	814
Montvale
95 Chestnut Ridge Road (O)	1975	1997	--	1,227		4,907	209	1,227		5,116	6,343	1,679
135 Chestnut Ridge Road (O)	1981	1997	--	2,587		10,350	2,318	2,588		12,667	15,255	4,967
Paramus
15 East Midland Avenue (O)	1988	1997	13,000	10,375		41,497	663	10,374		42,161	52,535	13,624
140 East Ridgewood
Avenue (O)	1981	1997	12,250	7,932		31,463	5,905	7,932		37,368	45,300	11,782
461 From Road (O)	1988	1997	--	13,194		52,778	264	13,194		53,042	66,236	17,347
650 From Road (O)	1978	1997	23,500	10,487		41,949	6,454	10,487		48,403	58,890	16,700
61 South Paramus Road (O) (d)	1985	1997	23,000	9,005		36,018	6,569	9,005		42,587	51,592	14,239
Rochelle Park
120 West Passaic Street (O)	1972	1997	--	1,354		5,415	103	1,357		5,515	6,872	1,830
365 West Passaic Street (O)	1976	1997	12,250	4,148		16,592	3,666	4,148		20,258	24,406	6,619
395 West Passaic Street (O)	1979	2006	11,270	2,550		17,131	755	2,550		17,886	20,436	3,165
Upper Saddle River
1 Lake Street (O)	1994	1997	42,000	13,952		55,812	1,365	13,953		57,176	71,129	18,235
10 Mountainview Road (O)	1986	1998	--	4,240		20,485	2,784	4,240		23,269	27,509	8,083
Woodcliff Lake
400 Chestnut Ridge Road (O)	1982	1997	--	4,201		16,802	5,080	4,201		21,882	26,083	8,505
470 Chestnut Ridge Road (O)	1987	1997	--	2,346		9,385	1,515	2,346		10,900	13,246	3,509
530 Chestnut Ridge Road (O)	1986	1997	--	1,860		7,441	126	1,860		7,567	9,427	2,470
50 Tice Boulevard (O)	1984	1994	24,000	4,500		--	24,999	4,500		24,999	29,499	15,061
300 Tice Boulevard (O)	1991	1996	--	5,424		29,688	4,966	5,424		34,654	40,078	11,796
Burlington County
Burlington
3 Terri Lane (F)	1991	1998	--	652		3,433	1,983	658		5,410	6,068	2,017
5 Terri Lane (F)	1992	1998	--	564		3,792	2,232	569		6,019	6,588	2,105
Moorestown
2 Commerce Drive (F)	1986	1999	--	723		2,893	741	723		3,634	4,357	1,084
101 Commerce Drive (F)	1988	1998	--	422		3,528	436	426		3,960	4,386	1,341
102 Commerce Drive (F)	1987	1999	--	389		1,554	311	389		1,865	2,254	641
201 Commerce Drive (F)	1986	1998	--	254		1,694	480	258		2,170	2,428	814
202 Commerce Drive (F)	1988	1999	--	490		1,963	774	490		2,737	3,227	926
1 Executive Drive (F)	1989	1998	--	226		1,453	586	228		2,037	2,265	808
2 Executive Drive (F)	1988	2000	--	801		3,206	960	801		4,166	4,967	1,396
101 Executive Drive (F)	1990	1998	--	241		2,262	713	244		2,972	3,216	1,094
102 Executive Drive (F)	1990	1998	--	353		3,607	370	357		3,973	4,330	1,273
225 Executive Drive (F)	1990	1998	--	323		2,477	485	326		2,959	3,285	1,036
97 Foster Road (F)	1982	1998	--	208		1,382	392	211		1,771	1,982	606
1507 Lancer Drive (F)	1995	1998	--	119		1,106	51	120		1,156	1,276	390
1245 North Church Street (F)	1998	2001	--	691		2,810	103	691		2,913	3,604	733
1247 North Church Street (F)	1998	2001	--	805		3,269	204	805		3,473	4,278	923

106

MACK-CALI REALTY, L.P.
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2010
(dollars in thousands)
											SCHEDULE III
								Gross Amount at Which
							Costs	Carried at Close of
					Initial Costs		Capitalized		Period (a)
	Year		Related			Building and	Subsequent			Building and		Accumulated
Property Location (b)	Built	Acquired	Encumbrances	Land		Improvements	to Acquisition	Land		Improvements	Total	Depreciation (c)
1256 North Church Street (F)	1984	1998	--	354		3,098	307	357		3,402	3,759	1,224
840 North Lenola Road (F)	1995	1998	--	329		2,366	513	333		2,875	3,208	1,082
844 North Lenola Road (F)	1995	1998	--	239		1,714	346	241		2,058	2,299	823
915 North Lenola Road (F)	1998	2000	--	508		2,034	267	508		2,301	2,809	626
224 Strawbridge Drive (O)	1984	1997	--	766		4,335	3,209	767		7,543	8,310	2,550
228 Strawbridge Drive (O)	1984	1997	--	766		4,334	3,945	767		8,278	9,045	2,274
232 Strawbridge Drive (O)	1986	2004	--	1,521		7,076	1,936	1,521		9,012	10,533	2,001
2 Twosome Drive (F)	2000	2001	--	701		2,807	157	701		2,964	3,665	682
30 Twosome Drive (F)	1997	1998	--	234		1,954	490	236		2,442	2,678	859
31 Twosome Drive (F)	1998	2001	--	815		3,276	179	815		3,455	4,270	880
40 Twosome Drive (F)	1996	1998	--	297		2,393	313	301		2,702	3,003	1,032
41 Twosome Drive (F)	1998	2001	--	605		2,459	69	605		2,528	3,133	647
50 Twosome Drive (F)	1997	1998	--	301		2,330	92	304		2,419	2,723	831
Gloucester County
West Deptford
1451 Metropolitan Drive			--	203		1,189	30	206		1,216	1,422	420
Essex County
Millburn
150 J.F. Kennedy Parkway (O)	1980	1997	--	12,606		50,425	8,743	12,606		59,168	71,774	22,137
Roseland
4 Becker Farm Road (O)	1983	2009	37,096	5,600		38,285	489	5,600		38,774	44,374	2,318
5 Becker Farm Road (O)	1982	2009	11,599	2,400		11,885	51	2,400		11,936	14,336	819
6 Becker Farm Road (O)	1983	2009	13,392	2,600		15,548	362	2,600		15,910	18,510	988
101 Eisenhower Parkway (O)	1980	1994	--	228		--	16,355	228		16,355	16,583	10,709
103 Eisenhower Parkway (O)	1985	1994	--	--		--	14,645	2,300		12,345	14,645	7,259
105 Eisenhower Parkway (O)	2001	2001	--	4,430		42,898	6,986	3,835		50,479	54,314	16,849
75 Livingston Avenue (O)	1985	2009	10,250	1,900		6,312	161	1,900		6,473	8,373	658
85 Livingston Avenue (O)	1985	2009	14,349	2,500		14,238	74	2,500		14,312	16,812	871
Hudson County
Jersey City
Harborside Financial Center
Plaza 1 (O)	1983	1996	--	3,923		51,013	27,528	3,923		78,541	82,464	24,158
Harborside Financial Center
Plaza 2 (O)	1990	1996	--	17,655		101,546	19,559	15,070		123,690	138,760	44,655
Harborside Financial Center
Plaza 3 (O)	1990	1996	--	17,655		101,878	19,227	15,070		123,690	138,760	44,655
Harborside Financial Center
Plaza 4A (O)	2000	2000	--	1,244		56,144	8,740	1,244		64,884	66,128	19,657
Harborside Financial Center
Plaza 5 (O)	2002	2002	234,521	6,218		170,682	53,469	5,705		224,664	230,369	55,047
101 Hudson Street (O)	1992	2004	--	45,530		271,376	8,627	45,530		280,003	325,533	52,355
Mercer County
Hamilton Township
3 AAA Drive (O)	1981	2007	--	242		3,218	1,057	242		4,275	4,517	572
100 Horizon Center
Boulevard (F)	1989	1995	--	205		1,676	223	311		1,793	2,104	726
200 Horizon Drive (F)	1991	1995	--	205		3,027	505	344		3,393	3,737	1,375
300 Horizon Drive (F)	1989	1995	--	379		4,355	1,637	517		5,854	6,371	2,736
500 Horizon Drive (F)	1990	1995	--	379		3,395	904	483		4,195	4,678	1,801
600 Horizon Drive (F)	2002	2002	--	--		7,549	651	685		7,515	8,200	1,519

107

MACK-CALI REALTY, L.P.
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2010
(dollars in thousands)
											SCHEDULE III
								Gross Amount at Which
							Costs	Carried at Close of
					Initial Costs		Capitalized		Period (a)
	Year		Related			Building and	Subsequent			Building and		Accumulated
Property Location (b)	Built	Acquired	Encumbrances	Land		Improvements	to Acquisition	Land		Improvements	Total	Depreciation (c)
700 Horizon Drive (O)	2007	2007	--	490		43	16,492	865		16,160	17,025	1,572
2 South Gold Drive (O)	1974	2007	--	476		3,487	388	476		3,875	4,351	427
Princeton
103 Carnegie Center (O)	1984	1996	--	2,566		7,868	3,059	2,566		10,927	13,493	4,157
2 Independence Way (O)	1985	2009	--	1,300		7,246	125	1,300		7,371	8,671	535
3 Independence Way (O)	1983	1997	--	1,997		11,391	3,396	1,997		14,787	16,784	5,310
100 Overlook Center (O)	1988	1997	--	2,378		21,754	4,889	2,378		26,643	29,021	10,383
5 Vaughn Drive (O)	1987	1995	--	657		9,800	2,631	657		12,431	13,088	5,461
Middlesex County
East Brunswick
377 Summerhill Road (O)	1977	1997	--	649		2,594	457	649		3,051	3,700	1,061
Edison
343 Thornall Street (O)	1991	2006	--	6,027		39,101	4,746	6,027		43,847	49,874	7,709
Piscataway
30 Knightsbridge Road,
Building 3 (O)	1977	2004	--	1,030		7,269	345	1,034		7,610	8,644	1,252
30 Knightsbridge Road,
Building 4 (O)	1977	2004	--	1,433		10,121	384	1,429		10,509	11,938	1,727
30 Knightsbridge Road,
Building 5 (O)	1977	2004	--	2,979		21,035	10,595	2,979		31,630	34,609	7,026
30 Knightsbridge Road,
Building 6 (O)	1977	2004	--	448		3,161	4,483	448		7,644	8,092	1,529
Plainsboro
500 College Road East (O) (d)	1984	1998	--	614		20,626	1,769	614		22,395	23,009	7,481
Woodbridge
581 Main Street (O)	1991	1997	16,627	3,237		12,949	24,764	8,115		32,835	40,950	10,798
Monmouth County
Freehold
2 Paragon Way (O)	1989	2005	--	999		4,619	941	999		5,560	6,559	1,055
3 Paragon Way (O)	1991	2005	--	1,423		6,041	1,939	1,423		7,980	9,403	1,621
4 Paragon Way (O)	2002	2005	--	1,961		8,827	(469)	1,961		8,358	10,319	1,340
100 Willowbrook Road (O)	1988	2005	--	1,264		5,573	984	1,264		6,557	7,821	1,373
Holmdel
23 Main Street (O)	1977	2005	31,537	4,336		19,544	8,903	4,336		28,447	32,783	6,488
Middletown
One River Center,
Building 1 (O)	1983	2004	11,408	3,070		17,414	2,739	2,451		20,772	23,223	4,713
One River Center,
Building 2 (O)	1983	2004	12,797	2,468		15,043	1,516	2,452		16,575	19,027	2,753
One River Center,
Building 3 (O)	1984	2004	20,336	4,051		24,790	4,798	4,627		29,012	33,639	4,722
Neptune
3600 Route 66 (O)	1989	1995	--	1,098		18,146	1,483	1,098		19,629	20,727	7,286
Wall Township
1305 Campus Parkway (O)	1988	1995	--	335		2,560	617	291		3,221	3,512	1,361
1325 Campus Parkway (F)	1988	1995	--	270		2,928	789	270		3,717	3,987	1,766
1340 Campus Parkway (F)	1992	1995	--	489		4,621	1,934	489		6,555	7,044	2,547
1345 Campus Parkway (F)	1995	1997	--	1,023		5,703	1,523	1,024		7,225	8,249	2,765
1350 Campus Parkway (O)	1990	1995	--	454		7,134	1,382	454		8,516	8,970	3,499
1433 Highway 34 (F)	1985	1995	--	889		4,321	1,227	889		5,548	6,437	2,295

108

MACK-CALI REALTY, L.P.
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2010
(dollars in thousands)
											SCHEDULE III
								Gross Amount at Which
							Costs	Carried at Close of
					Initial Costs		Capitalized		Period (a)
	Year		Related			Building and	Subsequent			Building and		Accumulated
Property Location (b)	Built	Acquired	Encumbrances	Land		Improvements	to Acquisition	Land		Improvements	Total	Depreciation (c)
1320 Wyckoff Avenue (F)	1986	1995	--	255		1,285	259	216		1,583	1,799	539
1324 Wyckoff Avenue (F)	1987	1995	--	230		1,439	239	190		1,718	1,908	687
Morris County
Florham Park
325 Columbia Parkway (O)	1987	1994	--	1,564		--	15,634	1,564		15,634	17,198	8,696
Morris Plains
250 Johnson Road (O)	1977	1997	--	2,004		8,016	1,175	2,004		9,191	11,195	3,403
201 Littleton Road (O)	1979	1997	--	2,407		9,627	1,245	2,407		10,872	13,279	3,720
Morris Township
412 Mt. Kemble Avenue (O)	1985	2004	--	4,360		33,167	11,684	4,360		44,851	49,211	8,963
Parsippany
4 Campus Drive (O)	1983	2001	--	5,213		20,984	2,938	5,213		23,922	29,135	6,314
6 Campus Drive (O)	1983	2001	--	4,411		17,796	3,496	4,411		21,292	25,703	5,996
7 Campus Drive (O)	1982	1998	--	1,932		27,788	5,260	1,932		33,048	34,980	9,896
8 Campus Drive (O)	1987	1998	--	1,865		35,456	4,042	1,865		39,498	41,363	13,927
9 Campus Drive (O)	1983	2001	--	3,277		11,796	17,066	5,842		26,297	32,139	7,303
4 Century Drive (O)	1981	2004	--	1,787		9,575	1,679	1,787		11,254	13,041	2,255
5 Century Drive (O)	1981	2004	--	1,762		9,341	2,263	1,762		11,604	13,366	1,889
6 Century Drive (O)	1981	2004	--	1,289		6,848	3,403	1,289		10,251	11,540	3,118
2 Dryden Way (O)	1990	1998	--	778		420	110	778		530	1,308	171
4 Gatehall Drive (O)	1988	2000	--	8,452		33,929	4,123	8,452		38,052	46,504	10,929
2 Hilton Court (O)	1991	1998	--	1,971		32,007	5,570	1,971		37,577	39,548	12,108
1633 Littleton Road (O)	1978	2002	--	2,283		9,550	163	2,355		9,641	11,996	2,871
600 Parsippany Road (O)	1978	1994	--	1,257		5,594	2,882	1,257		8,476	9,733	3,801
1 Sylvan Way (O)	1989	1998	--	1,689		24,699	1,446	1,021		26,813	27,834	7,910
4 Sylvan Way (O)	1983	2009	14,395	2,400		13,486	--	2,400		13,486	15,886	849
5 Sylvan Way (O)	1989	1998	--	1,160		25,214	2,719	1,161		27,932	29,093	9,793
7 Sylvan Way (O)	1987	1998	--	2,084		26,083	2,091	2,084		28,174	30,258	10,251
22 Sylvan Way (O)	2009	2009	--	14,600		44,392	73	14,600		44,465	59,065	2,880
20 Waterview Boulevard (O)	1988	2009	23,232	4,500		27,246	327	4,500		27,573	32,073	2,177
35 Waterview Boulevard (O)	1990	2006	19,341	5,133		28,059	1,251	5,133		29,310	34,443	4,420
5 Wood Hollow Road (O)	1979	2004	--	5,302		26,488	12,267	5,302		38,755	44,057	8,280
Passaic County
Clifton
777 Passaic Avenue (O)	1983	1994	--	--		--	6,839	1,100		5,739	6,839	3,445
Totowa
1 Center Court (F)	1999	1999	--	270		1,824	30	270		1,854	2,124	549
2 Center Court (F)	1998	1998	--	191		--	2,255	191		2,255	2,446	755
11 Commerce Way (F)	1989	1995	--	586		2,986	70	586		3,056	3,642	1,160
20 Commerce Way (F)	1992	1995	--	516		3,108	17	516		3,125	3,641	1,188
29 Commerce Way (F)	1990	1995	--	586		3,092	1,101	586		4,193	4,779	2,028
40 Commerce Way (F)	1987	1995	--	516		3,260	195	516		3,455	3,971	1,321
45 Commerce Way (F)	1992	1995	--	536		3,379	622	536		4,001	4,537	1,666
60 Commerce Way (F)	1988	1995	--	526		3,257	620	526		3,877	4,403	1,521
80 Commerce Way (F)	1996	1996	--	227		--	1,167	227		1,167	1,394	416
100 Commerce Way (F)	1996	1996	--	226		--	1,167	226		1,167	1,393	416
120 Commerce Way (F)	1994	1995	--	228		--	1,269	229		1,268	1,497	503
140 Commerce Way (F)	1994	1995	--	229		--	1,267	228		1,268	1,496	503
999 Riverview Drive (O)	1988	1995	--	476		6,024	2,320	1,102		7,718	8,820	3,090

109

MACK-CALI REALTY, L.P.
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2010
(dollars in thousands)
											SCHEDULE III
								Gross Amount at Which
							Costs	Carried at Close of
					Initial Costs		Capitalized		Period (a)
	Year		Related			Building and	Subsequent			Building and		Accumulated
Property Location (b)	Built	Acquired	Encumbrances	Land		Improvements	to Acquisition	Land		Improvements	Total	Depreciation (c)
Somerset County
Basking Ridge
222 Mt. Airy Road (O)	1986	1996	--	775		3,636	2,909	775		6,545	7,320	2,415
233 Mt. Airy Road (O)	1987	1996	--	1,034		5,033	1,646	1,034		6,679	7,713	3,232
Bernards
106 Allen Road (O)	2000	2000	--	3,853		14,465	4,116	4,093		18,341	22,434	7,944
Branchburg
51 Imclone Drive (O)	1978	2009	3,893	1,900		3,475	(1)	1,900		3,474	5,374	222
Bridgewater
440 Route 22 East (O)	1990	2010	11,000	3,986		13,658	3,142	3,986		16,800	20,786	33
721 Route 202/206 (O)	1989	1997	--	6,730		26,919	8,666	6,730		35,585	42,315	11,830
Warren
10 Independence Boulevard (O)	1988	2009	15,606	2,300		15,499	25	2,300		15,524	17,824	1,077
Union County
Clark
100 Walnut Avenue (O)	1985	1994	19,443	--		--	17,228	1,822		15,406	17,228	9,431
Cranford
6 Commerce Drive (O)	1973	1994	--	250		--	3,082	250		3,082	3,332	2,182
11 Commerce Drive (O)	1981	1994	--	470		--	5,840	470		5,840	6,310	4,290
12 Commerce Drive (O)	1967	1997	--	887		3,549	2,207	887		5,756	6,643	2,261
14 Commerce Drive (O)	1971	2003	--	1,283		6,344	1,096	1,283		7,440	8,723	1,480
20 Commerce Drive (O)	1990	1994	--	2,346		--	20,356	2,346		20,356	22,702	9,627
25 Commerce Drive (O)	1971	2002	--	1,520		6,186	565	1,520		6,751	8,271	2,177
65 Jackson Drive (O)	1984	1994	--	541		--	6,329	542		6,328	6,870	4,169
New Providence
890 Mountain Road (O)	1977	1997	--	2,796		11,185	4,935	3,765		15,151	18,916	4,962
NEW YORK
New York County
New York
125 Broad Street (O)	1970	2007	--	50,191		207,002	13,379	50,191		220,381	270,572	23,830
Rockland County
Suffern
400 Rella Boulevard (O)	1988	1995	--	1,090		13,412	2,980	1,090		16,392	17,482	6,603
Westchester County
Elmsford
11 Clearbrook Road (F)	1974	1997	--	149		2,159	479	149		2,638	2,787	999
75 Clearbrook Road (F)	1990	1997	--	2,314		4,716	107	2,314		4,823	7,137	1,691
100 Clearbrook Road (O)	1975	1997	--	220		5,366	1,354	220		6,720	6,940	2,294
125 Clearbrook Road (F)	2002	2002	--	1,055		3,676	(51)	1,055		3,625	4,680	1,416
150 Clearbrook Road (F)	1975	1997	--	497		7,030	1,126	497		8,156	8,653	2,869
175 Clearbrook Road (F)	1973	1997	--	655		7,473	917	655		8,390	9,045	3,083
200 Clearbrook Road (F)	1974	1997	--	579		6,620	1,246	579		7,866	8,445	2,907
250 Clearbrook Road (F)	1973	1997	--	867		8,647	1,309	867		9,956	10,823	3,452
50 Executive Boulevard (F)	1969	1997	--	237		2,617	312	237		2,929	3,166	1,046
77 Executive Boulevard (F)	1977	1997	--	34		1,104	155	34		1,259	1,293	449
85 Executive Boulevard (F)	1968	1997	--	155		2,507	624	155		3,131	3,286	1,226
101 Executive Boulevard (O)	1971	1997	--	267		5,838	792	267		6,630	6,897	2,372
300 Executive Boulevard (F)	1970	1997	--	460		3,609	358	460		3,967	4,427	1,449

110

MACK-CALI REALTY, L.P.
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2010
(dollars in thousands)
											SCHEDULE III
								Gross Amount at Which
							Costs	Carried at Close of
					Initial Costs		Capitalized		Period (a)
	Year		Related			Building and	Subsequent			Building and		Accumulated
Property Location (b)	Built	Acquired	Encumbrances	Land		Improvements	to Acquisition	Land		Improvements	Total	Depreciation (c)
350 Executive Boulevard (F)	1970	1997	--	100		1,793	15	100		1,808	1,908	628
399 Executive Boulevard (F)	1962	1997	--	531		7,191	163	531		7,354	7,885	2,542
400 Executive Boulevard (F)	1970	1997	--	2,202		1,846	656	2,202		2,502	4,704	830
500 Executive Boulevard (F)	1970	1997	--	258		4,183	757	258		4,940	5,198	1,942
525 Executive Boulevard (F)	1972	1997	--	345		5,499	960	345		6,459	6,804	2,274
700 Executive Boulevard (L)	N/A	1997	--	970		--	--	970		--	970	--
555 Taxter Road (O)	1986	2000	--	4,285		17,205	5,197	4,285		22,402	26,687	7,197
565 Taxter Road (O)	1988	2000	--	4,285		17,205	3,715	4,233		20,972	25,205	6,748
570 Taxter Road (O)	1972	1997	--	438		6,078	1,277	438		7,355	7,793	2,447
1 Warehouse Lane (I) (d)	1957	1997	--	3		268	240	3		508	511	173
2 Warehouse Lane (I) (d)	1957	1997	--	4		672	113	4		785	789	290
3 Warehouse Lane (I) (d)	1957	1997	--	21		1,948	526	21		2,474	2,495	1,009
4 Warehouse Lane (I) (d)	1957	1997	--	84		13,393	2,660	85		16,052	16,137	5,955
5 Warehouse Lane (I) (d)	1957	1997	--	19		4,804	1,431	19		6,235	6,254	2,348
6 Warehouse Lane (I) (d)	1982	1997	--	10		4,419	1,858	10		6,277	6,287	1,661
1 Westchester Plaza (F)	1967	1997	--	199		2,023	386	199		2,409	2,608	770
2 Westchester Plaza (F)	1968	1997	--	234		2,726	247	234		2,973	3,207	1,082
3 Westchester Plaza (F)	1969	1997	--	655		7,936	1,148	655		9,084	9,739	3,175
4 Westchester Plaza (F)	1969	1997	--	320		3,729	915	320		4,644	4,964	1,448
5 Westchester Plaza (F)	1969	1997	--	118		1,949	525	118		2,474	2,592	812
6 Westchester Plaza (F)	1968	1997	--	164		1,998	124	164		2,122	2,286	748
7 Westchester Plaza (F)	1972	1997	--	286		4,321	220	286		4,541	4,827	1,566
8 Westchester Plaza (F)	1971	1997	--	447		5,262	971	447		6,233	6,680	2,309
Hawthorne
200 Saw Mill River Road (F)	1965	1997	--	353		3,353	446	353		3,799	4,152	1,286
1 Skyline Drive (O)	1980	1997	--	66		1,711	301	66		2,012	2,078	758
2 Skyline Drive (O)	1987	1997	--	109		3,128	1,493	109		4,621	4,730	1,260
4 Skyline Drive (F)	1987	1997	--	363		7,513	2,443	363		9,956	10,319	3,583
5 Skyline Drive (F)	1980	2001	--	2,219		8,916	1,488	2,219		10,404	12,623	3,419
6 Skyline Drive (F)	1980	2001	--	740		2,971	636	740		3,607	4,347	1,205
7 Skyline Drive (O)	1987	1998	--	330		13,013	2,147	330		15,160	15,490	5,084
8 Skyline Drive (F)	1985	1997	--	212		4,410	1,038	212		5,448	5,660	1,937
10 Skyline Drive (F)	1985	1997	--	134		2,799	695	134		3,494	3,628	1,208
11 Skyline Drive (F) (d)	1989	1997	--	--		4,788	415	--		5,203	5,203	2,016
12 Skyline Drive (F) (d)	1999	1999	--	1,562		3,254	837	1,320		4,333	5,653	1,653
15 Skyline Drive (F) (d)	1989	1997	--	--		7,449	442	--		7,891	7,891	2,808
17 Skyline Drive (O) (d)	1989	1997	--	--		7,269	846	--		8,115	8,115	2,689
19 Skyline Drive (O)	1982	1997	--	2,355		34,254	1,189	2,356		35,442	37,798	12,481
Tarrytown
200 White Plains Road (O)	1982	1997	--	378		8,367	1,679	378		10,046	10,424	3,545
220 White Plains Road (O)	1984	1997	--	367		8,112	1,450	367		9,562	9,929	3,432
230 White Plains Road (C)	1984	1997	--	124		1,845	107	124		1,952	2,076	663
White Plains
1 Barker Avenue (O)	1975	1997	--	208		9,629	1,221	207		10,851	11,058	3,830
3 Barker Avenue (O)	1983	1997	--	122		7,864	2,060	122		9,924	10,046	4,074
50 Main Street (O)	1985	1997	--	564		48,105	10,067	564		58,172	58,736	20,489
11 Martine Avenue (O)	1987	1997	--	127		26,833	7,626	127		34,459	34,586	11,935
1 Water Street (O)	1979	1997	--	211		5,382	1,205	211		6,587	6,798	2,620
Yonkers
100 Corporate Boulevard (F)	1987	1997	--	602		9,910	1,417	602		11,327	11,929	4,143
200 Corporate Boulevard
South (F)	1990	1997	--	502		7,575	1,185	502		8,760	9,262	2,809
1 Enterprise Boulevard (L)	N/A	1997	--	1,379		--	1	1,380		--	1,380	--
1 Executive Boulevard (O)	1982	1997	--	1,104		11,904	2,753	1,105		14,656	15,761	5,386

111

MACK-CALI REALTY, L.P.
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2010
(dollars in thousands)
											SCHEDULE III
								Gross Amount at Which
							Costs	Carried at Close of
					Initial Costs		Capitalized		Period (a)
	Year		Related			Building and	Subsequent			Building and		Accumulated
Property Location (b)	Built	Acquired	Encumbrances	Land		Improvements	to Acquisition	Land		Improvements	Total	Depreciation (c)
2 Executive Boulevard (C)	1986	1997	--	89		2,439	38	89		2,477	2,566	850
3 Executive Boulevard (O)	1987	1997	--	385		6,256	1,353	385		7,609	7,994	2,568
4 Executive Plaza (F)	1986	1997	--	584		6,134	2,061	584		8,195	8,779	3,463
6 Executive Plaza (F)	1987	1997	--	546		7,246	990	546		8,236	8,782	2,737
1 Odell Plaza (F)	1980	1997	--	1,206		6,815	1,481	1,206		8,296	9,502	2,838
3 Odell Plaza (O)	1984	2003	--	1,322		4,777	2,302	1,322		7,079	8,401	1,907
5 Odell Plaza (F)	1983	1997	--	331		2,988	813	331		3,801	4,132	1,353
7 Odell Plaza (F)	1984	1997	--	419		4,418	559	419		4,977	5,396	1,767
PENNSYLVANIA
Chester County
Berwyn
1000 Westlakes Drive (O)	1989	1997	--	619		9,016	528	619		9,544	10,163	3,520
1055 Westlakes Drive (O)	1990	1997	--	1,951		19,046	3,545	1,951		22,591	24,542	9,015
1205 Westlakes Drive (O)	1988	1997	--	1,323		20,098	2,721	1,323		22,819	24,142	8,231
1235 Westlakes Drive (O)	1986	1997	--	1,417		21,215	3,268	1,418		24,482	25,900	9,065
Delaware County
Lester
100 Stevens Drive (O)	1986	1996	--	1,349		10,018	3,891	1,349		13,909	15,258	5,526
200 Stevens Drive (O)	1987	1996	--	1,644		20,186	6,064	1,644		26,250	27,894	10,274
300 Stevens Drive (O)	1992	1996	--	491		9,490	1,565	491		11,055	11,546	4,219
Media
1400 Providence Rd,
Center I (O)	1986	1996	--	1,042		9,054	2,531	1,042		11,585	12,627	4,448
1400 Providence Rd,
Center II (O)	1990	1996	--	1,543		16,464	4,299	1,544		20,762	22,306	7,841
Montgomery County
Bala Cynwyd
150 Monument Road (O)	1981	2004	--	2,845		14,780	4,007	2,845		18,787	21,632	3,555
Blue Bell
4 Sentry Park (O)	1982	2003	--	1,749		7,721	867	1,749		8,588	10,337	1,609
5 Sentry Park East (O)	1984	1996	--	642		7,992	3,508	642		11,500	12,142	3,546
5 Sentry Park West (O)	1984	1996	--	268		3,334	616	268		3,950	4,218	1,315
16 Sentry Park West (O)	1988	2002	--	3,377		13,511	1,965	3,377		15,476	18,853	4,693
18 Sentry Park West (O)	1988	2002	--	3,515		14,062	1,907	3,515		15,969	19,484	4,795
King of Prussia
2200 Renaissance Blvd (O)	1985	2002	16,171	5,347		21,453	(9,121)	3,126		14,553	17,679	4,581
Lower Providence
1000 Madison Avenue (O)	1990	1997	--	1,713		12,559	3,064	1,714		15,622	17,336	5,548
Plymouth Meeting
1150 Plymouth Meeting
Mall (O)	1970	1997	--	125		499	30,765	6,219		25,170	31,389	9,140
CONNETICUT
Fairfield County
Norwalk
40 Richards Avenue (O)	1985	1998	--	1,087		18,399	3,892	1,087		22,291	23,378	6,860
Stamford
1266 East Main Street (O)	1984	2002	16,089	6,638		26,567	4,640	6,638		31,207	37,845	8,540
419 West Avenue (F)	1986	1997	--	4,538		9,246	1,490	4,538		10,736	15,274	4,248

112

MACK-CALI REALTY, L.P.
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 2010
(dollars in thousands)
												SCHEDULE III
									Gross Amount at Which
								Costs	Carried at Close of
						Initial Costs		Capitalized		Period (a)
		Year		Related			Building and	Subsequent			Building and		Accumulated
Property Location (b)		Built	Acquired	Encumbrances	Land		Improvements	to Acquisition	Land		Improvements	Total	Depreciation (c)
500 West Avenue (F)		1988	1997	--	415		1,679	52	415		1,731	2,146	597
550 West Avenue (F)		1990	1997	--	1,975		3,856	176	1,975		4,032	6,007	1,362
600 West Avenue (F)		1999	1999	--	2,305		2,863	839	2,305		3,702	6,007	1,053
650 West Avenue (F)		1998	1998	--	1,328		--	3,292	1,328		3,292	4,620	1,119
DISTRICT OF COLUMBIA
Washington,
1201 Connecticut Avenue,
NW (O)		1940	1999	--	14,228		18,571	4,881	14,228		23,452	37,680	7,565
1400 L Street, NW (O)		1987	1998	--	13,054		27,423	7,444	13,054		34,867	47,921	11,942
MARYLAND
Prince George’s County
Greenbelt
Capital Office Park Parcel A (L)		N/A	2009	--	840		--	7	847		--	847	--
9200 Edmonston Road (O)	1973/03		2006	4,646	1,547		4,131	147	1,547		4,278	5,825	871
6301 Ivy Lane (O)	1979/95		2006	6,103	5,168		14,706	1,186	5,168		15,892	21,060	2,302
6303 Ivy Lane (O)	1980/03		2006	--	5,115		13,860	758	5,115		14,618	19,733	2,202
6305 Ivy Lane (O)	1982/95		2006	6,475	5,615		14,420	537	5,615		14,957	20,572	2,498
6404 Ivy Lane (O)		1987	2006	--	7,578		20,785	1,718	7,578		22,503	30,081	3,795
6406 Ivy Lane (O)		1991	2006	--	7,514		21,152	(173)	7,514		20,979	28,493	2,537
6411 Ivy Lane (O)	1984/05		2006	--	6,867		17,470	1,097	6,867		18,567	25,434	3,047
Lanham
4200 Parliament Place (O)		1989	1998	--	2,114		13,546	761	1,393		15,028	16,421	5,470
Projects Under Development
and Developable Land				--	124,877		29,366	--	124,877		29,366	154,243	34
Furniture, Fixtures
and Equipment				--	--		--	4,485	--		4,485	4,485	3,212
TOTALS				$743,043	$760,033		$3,641,055	$815,632	$771,960		$4,444,760	$5,216,720	$1,278,985

(a) The aggregate cost for federal income tax purposes at December 31, 2010 was approximately $3.2 billion.

(b)   Legend of Property Codes:

(O)=Office Property                                           (C)=Stand-alone Retail Property

(F)=Office/Flex Property                                    (L)=Land Lease

(I)=Industrial/Warehouse Property

(c)    Depreciation of the buildings and improvements are calculated over lives ranging from the life of the lease to 40 years.

(d)    This property is located on land leased by the Company.

113

MACK-CALI REALTY, L.P.

NOTE TO SCHEDULE III

Changes in rental properties and accumulated depreciation for the periods ended December 31, 2010, 2009 and 2008 are as follows: (dollars in thousands)

	2010	2009	2008
Rental Properties
Balance at beginning of year	$5,186,208	$4,963,780	$4,885,429
Additions	86,455	282,122	92,129
Properties sold	(16,052)	--	--
Impairment charge on rental property	(12,560)	--	--
Retirements/disposals	(27,331)	(59,694)	(13,778)
Balance at end of year	$5,216,720	$5,186,208	$4,963,780
Accumulated Depreciation
Balance at beginning of year	$1,153,223	$1,040,778	$   907,013
Depreciation expense	158,318	155,613	147,543
Properties sold	(2,091)	--	--
Impairment charge on rental property	(3,256)	(1,009)	--
Retirements/disposals	(27,209)	(42,159)	(13,778)
Balance at end of year	$1,278,985	$1,153,223	$1,040,778

114

MACK-CALI REALTY, L.P.

Signatures

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Mack-Cali Realty, L.P
	(Registrant)
	By:  Mack-Cali Realty Corporation
	its General Partner
Date:           February 9, 2011	/s/ Barry Lefkowitz
	Barry Lefkowitz
	Executive Vice President and
	Chief Financial Officer
	(principal accounting officer and     principal financial officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated:

Name	Title	Date
/s/ William L. Mack	Chairman of the Board	February 9, 2011
William L. Mack
/s/ Mitchell E. Hersh	President and Chief Executive	February 9, 2011
Mitchell E. Hersh	Officer and Director
/s/ Barry Lefkowitz	Executive Vice President and	February 9, 2011
Barry Lefkowitz	Chief Financial Officer
/s/ Alan S. Bernikow	Director	February 9, 2011
Alan S. Bernikow
/s/ John R. Cali	Director	February 9, 2011
John R. Cali
/s/ Kenneth M. Duberstein	Director	February 9, 2011
Kenneth M. Duberstein

115

Name	Title	Date
/s/ Nathan Gantcher	Director	February 9, 2011
Nathan Gantcher
/s/ David S. Mack	Director	February 9, 2011
David S. Mack
/s/ Alan G. Philibosian	Director	February 9, 2011
Alan G. Philibosian
/s/ Irvin D. Reid	Director	February 9, 2011
Irvin D. Reid
/s/ Vincent Tese	Director	February 9, 2011
Vincent Tese
/s/ Robert F. Weinberg	Director	February 9, 2011
Robert F. Weinberg
/s/ Roy J. Zuckerberg	Director	February 9, 2011
Roy J. Zuckerberg

116

MACK-CALI REALTY, L.P.

EXHIBIT INDEX

Exhibit Number	Exhibit Title
3.1	Articles of Restatement of Mack-Cali Realty Corporation dated September 18, 2009 (filed as Exhibit 3.2 to the Company’s Form 8-K dated September 17, 2009 and incorporated herein by reference).
3.2	Amended and Restated Bylaws of Mack-Cali Realty Corporation dated June 10, 1999 (filed as Exhibit 3.2 to the Corporation’s Form 8-K dated June 10, 1999 and incorporated herein by reference).
3.3	Amendment No. 1 to the Amended and Restated Bylaws of Mack-Cali Realty Corporation dated March 4, 2003, (filed as Exhibit 3.3 to the Company’s Form 10-Q dated March 31, 2003 and incorporated herein by reference).
3.4	Amendment No. 2 to the Mack-Cali Realty Corporation Amended and Restated Bylaws dated May 24, 2006 (filed as Exhibit 3.1 to the Corporation’s Form 8-K dated May 24, 2006 and incorporated herein by reference).
3.5	Second Amended and Restated Agreement of Limited Partnership of Mack-Cali Realty, L.P. dated December 11, 1997 (filed as Exhibit 10.110 to the Corporation’s Form 8-K dated December 11, 1997 and incorporated herein by reference).
3.6	Amendment No. 1 to the Second Amended and Restated Agreement of Limited Partnership of Mack-Cali Realty, L.P. dated August 21, 1998 (filed as Exhibit 3.1 to the Corporation’s and the Operating Partnership’s Registration Statement on Form S-3, Registration No. 333-57103, and incorporated herein by reference).
3.7	Second Amendment to the Second Amended and Restated Agreement of Limited Partnership of Mack-Cali Realty, L.P. dated July 6, 1999 (filed as Exhibit 10.1 to the Company’s Form 8-K dated July 6, 1999 and incorporated herein by reference).
3.8	Third Amendment to the Second Amended and Restated Agreement of Limited Partnership of Mack-Cali Realty, L.P. dated September 30, 2003 (filed as Exhibit 3.7 to the Company’s Form 10-Q dated September 30, 2003 and incorporated herein by reference).
3.9	Certificate of Designation of Series B Preferred Operating Partnership Units of Limited Partnership Interest of Mack-Cali Realty, L.P. (filed as Exhibit 10.101 to the Corporation’s Form 8-K dated December 11, 1997 and incorporated herein by reference).
3.10	Certificate of Designation for the 8% Series C Cumulative Redeemable Perpetual Preferred Operating Partnership Units dated March 14, 2003 (filed as Exhibit 3.2 to the Company’s Form 8-K dated March 14, 2003 and incorporated herein by reference).
4.1	Indenture dated as of March 16, 1999, by and among Mack-Cali Realty, L.P., as issuer, Mack-Cali Realty Corporation, as guarantor, and Wilmington Trust Company, as trustee (filed as Exhibit 4.1 to the Operating Partnership’s Form 8-K dated March 16, 1999 and incorporated herein by reference).

117

Exhibit Number	Exhibit Title
4.2	Supplemental Indenture No. 1 dated as of March 16, 1999, by and among Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Operating Partnership’s Form 8-K dated March 16, 1999 and incorporated herein by reference).
4.3	Supplemental Indenture No. 2 dated as of August 2, 1999, by and among Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.4 to the Operating Partnership’s Form 10-Q dated June 30, 1999 and incorporated herein by reference).
4.4	Supplemental Indenture No. 3 dated as of December 21, 2000, by and among Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Operating Partnership’s Form 8-K dated December 21, 2000 and incorporated herein by reference).
4.5	Supplemental Indenture No. 4 dated as of January 29, 2001, by and among Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Operating Partnership’s Form 8-K dated January 29, 2001 and incorporated herein by reference).
4.6	Supplemental Indenture No. 5 dated as of December 20, 2002, by and between Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Operating Partnership’s Form 8-K dated December 20, 2002 and incorporated herein by reference).
4.7	Supplemental Indenture No. 6 dated as of March 14, 2003, by and between Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Company’s Form 8-K dated March 14, 2003 and incorporated herein by reference).
4.8	Supplemental Indenture No. 7 dated as of June 12, 2003, by and between Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Company’s Form 8-K dated June 12, 2003 and incorporated herein by reference).
4.9	Supplemental Indenture No. 8 dated as of February 9, 2004, by and between Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Company’s Form 8-K dated February 9, 2004 and incorporated herein by reference).
4.10	Supplemental Indenture No. 9 dated as of March 22, 2004, by and between Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Company’s Form 8-K dated March 22, 2004 and incorporated herein by reference).
4.11	Supplemental Indenture No. 10 dated as of January 25, 2005, by and between Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Company’s Form 8-K dated January 25, 2005 and incorporated herein by reference).
4.12	Supplemental Indenture No. 11 dated as of April 15, 2005, by and between Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Company’s Form 8-K dated April 15, 2005 and incorporated herein by reference).
4.13	Supplemental Indenture No. 12 dated as of November 30, 2005, by and between Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Company’s Form 8-K dated November 30, 2005 and incorporated herein by reference).
4.14	Supplemental Indenture No. 13 dated as of January 24, 2006, by and between Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Company’s Form 8-K dated January 18, 2006 and incorporated herein by reference).

118

Exhibit Number	Exhibit Title
4.15	Supplemental Indenture No. 14 dated as of August 14, 2009, by and between Mack-Cali Realty, L.P., as issuer, and Wilmington Trust Company, as trustee (filed as Exhibit 4.2 to the Company’s Form 8-K dated August 14, 2009 and incorporated herein by reference).
4.16	Deposit Agreement dated March 14, 2003 by and among Mack-Cali Realty Corporation, EquiServe Trust Company, N.A., and the holders from time to time of the Depositary Receipts described therein (filed as Exhibit 4.1 to the Company’s Form 8-K dated March 14, 2003 and incorporated herein by reference).
10.1	Amended and Restated Employment Agreement dated as of July 1, 1999 between Mitchell E. Hersh and Mack-Cali Realty Corporation (filed as Exhibit 10.2 to the Company’s Form 10-Q dated June 30, 1999 and incorporated herein by reference).
10.2	Letter Agreement dated December 9, 2008 by and between Mack-Cali Realty Corporation and Mitchell E. Hersh (filed as Exhibit 10.4 to the Company's Form 8-K dated December 9, 2008 and incorporated herein by reference).
10.3	Second Amended and Restated Employment Agreement dated as of July 1, 1999 between Barry Lefkowitz and Mack-Cali Realty Corporation (filed as Exhibit 10.6 to the Company’s Form 10-Q dated June 30, 1999 and incorporated herein by reference).
10.4	Letter Agreement dated December 9, 2008 by and between Mack-Cali Realty Corporation and Barry Lefkowitz (filed as Exhibit 10.5 to the Company's Form 8-K dated December 9, 2008 and incorporated herein by reference).
10.5	Second Amended and Restated Employment Agreement dated as of July 1, 1999 between Roger W. Thomas and Mack-Cali Realty Corporation (filed as Exhibit 10.7 to the Company’s Form 10-Q dated June 30, 1999 and incorporated herein by reference).
10.6	Letter Agreement dated December 9, 2008 by and between Mack-Cali Realty Corporation and Roger W. Thomas (filed as Exhibit 10.8 to the Company's Form 8-K dated December 9, 2008 and incorporated herein by reference).
10.7	Employment Agreement dated as of December 5, 2000 between Michael Grossman and Mack-Cali Realty Corporation (filed as Exhibit 10.5 to the Company’s Form 10-K for the year ended December 31, 2000 and incorporated herein by reference).
10.8	Letter Agreement dated December 9, 2008 by and between Mack-Cali Realty Corporation and Michael Grossman (filed as Exhibit 10.6 to the Company's Form 8-K dated December 9, 2008 and incorporated herein by reference).
10.9	Employment Agreement dated as of May 9, 2006 by and between Mark Yeager and Mack-Cali Realty Corporation (filed as Exhibit 10.15 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).
10.10	Letter Agreement dated December 9, 2008 by and between Mack-Cali Realty Corporation and Mark Yeager (filed as Exhibit 10.7 to the Company's Form 8-K dated December 9, 2008 and incorporated herein by reference).
10.11	Form of Multi-Year Restricted Share Award Agreement (filed as Exhibit 10.1 to the Company’s Form 8-K dated September 12, 2007 and incorporated herein by reference).

119

Exhibit Number	Exhibit Title
10.12	Form of Tax Gross-Up Agreement (filed as Exhibit 10.2 to the Company’s Form 8-K dated September 12, 2007 and incorporated herein by reference).
10.13	Form of Restricted Share Award Agreement effective December 9, 2008 by and between Mack-Cali Realty Corporation and each of Mitchell E. Hersh, Barry Lefkowitz, Michael Grossman, Mark Yeager and Roger W. Thomas (filed as Exhibit 10.1 to the Company's Form 8-K dated December 9, 2008 and incorporated herein by reference).
10.14	Form of Restricted Share Award Agreement effective December 9, 2008 by and between Mack-Cali Realty Corporation and each of William L. Mack, Alan S. Bernikow, John R. Cali, Kenneth M. Duberstein, Nathan Gantcher, David S. Mack, Alan G. Philibosian, Dr. Irvin D. Reid, Vincent Tese, Robert F. Weinberg and Roy J. Zuckerberg (filed as Exhibit 10.2 to the Company's Form 8-K dated December 9, 2008 and incorporated herein by reference).
10.15	Form of Restricted Share Award Agreement effective December 8, 2009 by and between Mack-Cali Realty Corporation and each of Mitchell E. Hersh, Barry Lefkowitz, Michael Grossman, Mark Yeager and Roger W. Thomas (filed as Exhibit 10.1 to the Company's Form 8-K dated December 8, 2009 and incorporated herein by reference).
10.16	Form of Restricted Share Award Agreement effective December 8, 2009 by and between Mack-Cali Realty Corporation and each of William L. Mack, Martin S. Berger, Alan S. Bernikow, John R. Cali, Kenneth M. Duberstein, Nathan Gantcher, David S. Mack, Alan G. Philibosian, Dr. Irvin D. Reid, Vincent Tese and Roy J. Zuckerberg (filed as Exhibit 10.2 to the Company's Form 8-K dated December 8, 2009 and incorporated herein by reference).
10.17	Form of Restricted Share Award Agreement effective December 7, 2010 by and between Mack-Cali Realty Corporation and each of Mitchell E. Hersh, Barry Lefkowitz, Michael Grossman and Roger W. Thomas (filed as Exhibit 10.1 to the Company's Form 8-K dated December 7, 2010 and incorporated herein by reference).
10.18	Form of Restricted Share Award Agreement effective December 7, 2010 by and between Mack-Cali Realty Corporation and each of William L. Mack, Alan S. Bernikow, John R. Cali, Kenneth M. Duberstein, Nathan Gantcher, David S. Mack, Alan G. Philibosian, Dr. Irvin D. Reid, Vincent Tese, Robert F. Weinberg and Roy J. Zuckerberg (filed as Exhibit 10.2 to the Company's Form 8-K dated December 7, 2010 and incorporated herein by reference).
10.19	Amended and Restated Revolving Credit Agreement dated as of September 27, 2002, among Mack-Cali Realty, L.P. and JPMorgan Chase Bank, Fleet National Bank and Other Lenders Which May Become Parties Thereto with JPMorgan Chase Bank, as administrative agent, swing lender and fronting bank, Fleet National Bank and Commerzbank AG, New York and Grand Cayman branches as syndication agents, Bank of America, N.A. and Wells Fargo Bank, National Association, as documentation agents, and J.P. Morgan Securities Inc. and Fleet Securities, Inc, as arrangers (filed as Exhibit 10.1 to the Company’s Form 8-K dated September 27, 2002 and incorporated herein by reference).
10.20	Second Amended and Restated Revolving Credit Agreement among Mack-Cali Realty, L.P., JPMorgan Chase Bank, N.A., Bank of America, N.A., and other lending institutions that are or may become a party to the Second Amended and Restated Revolving Credit Agreement dated as of November 23, 2004 (filed as Exhibit 10.1 to the Company’s Form 8-K dated November 23, 2004 and incorporated herein by reference).

120

Exhibit Number	Exhibit Title
10.21	Extension and Modification Agreement dated as of September 16, 2005 by and among Mack-Cali Realty, L.P., JPMorgan Chase Bank, N.A., as administrative agent, and the several Lenders party thereto (filed as Exhibit 10.1 to the Company’s Form 8-K dated September 16, 2005 and incorporated herein by reference).
10.22	Second Modification Agreement dated as of July 14, 2006 by and among Mack-Cali Realty, L.P., JPMorgan Chase Bank, N.A., as administrative agent, and the several Lenders party thereto (filed as Exhibit 10.1 to the Company’s Form 8-K dated July 14, 2006 and incorporated herein by reference).
10.23	Extension and Third Modification Agreement dated as of June 22, 2007 by and among Mack-Cali Realty, L.P., JPMorgan Chase Bank, N.A., as administrative agent, and the several Lenders party thereto (filed as Exhibit 10.1 to the Company’s Form 8-K dated June 22, 2007 and incorporated herein by reference).
10.24	Fourth Modification Agreement dated as of September 21, 2007 by and among Mack Cali Realty, L.P., JPMorgan Chase Bank, N.A., as administrative agent and the several Lenders party thereto (filed as Exhibit 10.1 to the Company’s Form 8-K dated September 21, 2007 and incorporated herein by reference).
10.25	Amended and Restated Master Loan Agreement dated as of November 12, 2004 among Mack-Cali Realty, L.P., and Affiliates of Mack-Cali Realty Corporation and Mack-Cali Realty, L.P., as Borrowers, Mack-Cali Realty Corporation and Mack-Cali Realty L.P., as Guarantors and The Prudential Insurance Company of America, as Lender (filed as Exhibit 10.1 to the Company’s Form 8-K dated November 12, 2004 and incorporated herein by reference).
10.26	Contribution and Exchange Agreement among The MK Contributors, The MK Entities, The Patriot Contributors, The Patriot Entities, Patriot American Management and Leasing Corp., Cali Realty, L.P. and Cali Realty Corporation, dated September 18, 1997 (filed as Exhibit 10.98 to the Corporation’s Form 8-K dated September 19, 1997 and incorporated herein by reference).
10.27	First Amendment to Contribution and Exchange Agreement, dated as of December 11, 1997, by and among the Corporation and the Mack Group (filed as Exhibit 10.99 to the Corporation’s Form 8-K dated December 11, 1997 and incorporated herein by reference).
10.28	Employee Stock Option Plan of Mack-Cali Realty Corporation (filed as Exhibit 10.1 to the Corporation’s Post-Effective Amendment No. 1 to Form S-8, Registration No. 333-44443, and incorporated herein by reference).
10.29	Director Stock Option Plan of Mack-Cali Realty Corporation (filed as Exhibit 10.2 to the Corporation’s Post-Effective Amendment No. 1 to Form S-8, Registration No. 333-44443, and incorporated herein by reference).
10.30	2000 Employee Stock Option Plan (filed as Exhibit 10.1 to the Corporation’s Registration Statement on Form S-8, Registration No. 333-52478, and incorporated herein by reference), as amended by the First Amendment to the 2000 Employee Stock Option Plan (filed as Exhibit 10.17 to the Corporation’s Form 10-Q dated June 30, 2002 and incorporated herein by reference).
10.31	Amended and Restated 2000 Director Stock Option Plan (filed as Exhibit 10.2 to the Corporation’s Post-Effective Amendment No. 1 to Registration Statement on Form S-8, Registration No. 333-100244, and incorporated herein by reference).

121

Exhibit Number	Exhibit Title
10.32	Mack-Cali Realty Corporation 2004 Incentive Stock Plan (filed as Exhibit 10.1 to the Corporation’s Registration Statement on Form S-8, Registration No. 333-116437, and incorporated herein by reference).
10.33	Deferred Compensation Plan for Directors (filed as Exhibit 10.1 to the Corporation’s Registration Statement on Form S-8, Registration No. 333-80081, and incorporated herein by reference).
10.34	Amended and Restated Mack-Cali Realty Corporation Deferred Compensation Plan for Directors (filed as Exhibit 10.3 to the Company's Form 8-K dated December 9, 2008 and incorporated herein by reference).
10.35	Indemnification Agreement by and between Mack-Cali Realty Corporation and William L. Mack dated October 22, 2002 (filed as Exhibit 10.101 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.36	Indemnification Agreement by and between Mack-Cali Realty Corporation and Mitchell E. Hersh dated October 22, 2002 (filed as Exhibit 10.102 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.37	Indemnification Agreement by and between Mack-Cali Realty Corporation and Martin S. Berger dated December 11, 1997 (filed as Exhibit 10.103 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.38	Indemnification Agreement by and between Mack-Cali Realty Corporation and Alan S. Bernikow dated May 20, 2004 (filed as Exhibit 10.104 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.39	Indemnification Agreement by and between Mack-Cali Realty Corporation and John R. Cali dated October 22, 2002 (filed as Exhibit 10.105 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.40	Indemnification Agreement by and between Mack-Cali Realty Corporation and Kenneth M. Duberstein dated September 13, 2005 (filed as Exhibit 10.106 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.41	Indemnification Agreement by and between Mack-Cali Realty Corporation and Nathan Gantcher dated October 22, 2002 (filed as Exhibit 10.107 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.42	Indemnification Agreement by and between Mack-Cali Realty Corporation and David S. Mack dated December 11, 1997 (filed as Exhibit 10.108 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.43	Indemnification Agreement by and between Mack-Cali Realty Corporation and Alan G. Philibosian dated October 22, 2002 (filed as Exhibit 10.109 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.44	Indemnification Agreement by and between Mack-Cali Realty Corporation and Irvin D. Reid dated October 22, 2002 (filed as Exhibit 10.110 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).

122

Exhibit Number	Exhibit Title
10.45	Indemnification Agreement by and between Mack-Cali Realty Corporation and Vincent Tese dated October 22, 2002 (filed as Exhibit 10.111 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.46	Indemnification Agreement by and between Mack-Cali Realty Corporation and Robert F. Weinberg dated October 22, 2002 (filed as Exhibit 10.112 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.47	Indemnification Agreement by and between Mack-Cali Realty Corporation and Roy J. Zuckerberg dated October 22, 2002 (filed as Exhibit 10.113 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.48	Indemnification Agreement by and between Mack-Cali Realty Corporation and Barry Lefkowitz dated October 22, 2002 (filed as Exhibit 10.114 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.49	Indemnification Agreement by and between Mack-Cali Realty Corporation and Michael Grossman dated October 22, 2002 (filed as Exhibit 10.115 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.50	Indemnification Agreement by and between Mack-Cali Realty Corporation and Roger W. Thomas dated October 22, 2002 (filed as Exhibit 10.116 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.51	Indemnification Agreement by and between Mack-Cali Realty Corporation and Mark Yeager dated May 9, 2006 (filed as Exhibit 10.117 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.52	Indemnification Agreement dated October 22, 2002 by and between Mack-Cali Realty Corporation and John Crandall (filed as Exhibit 10.29 to the Company’s Form 10-Q dated September 30, 2002 and incorporated herein by reference).
10.53	Second Amendment to Contribution and Exchange Agreement, dated as of June 27, 2000, between RMC Development Company, LLC f/k/a Robert Martin Company, LLC, Robert Martin Eastview North Company, L.P., the Corporation and the Operating Partnership (filed as Exhibit 10.44 to the Company’s Form 10-K dated December 31, 2002 and incorporated herein by reference).
10.54	Limited Partnership Agreement of Meadowlands Mills/Mack-Cali Limited Partnership by and between Meadowlands Mills Limited Partnership, Mack-Cali Meadowlands Entertainment L.L.C. and Mack-Cali Meadowlands Special L.L.C. dated November 25, 2003 (filed as Exhibit 10.1 to the Corporation’s Form 8-K dated December 3, 2003 and incorporated herein by reference).
10.55	Redevelopment Agreement by and between the New Jersey Sports and Exposition Authority and Meadowlands Mills/Mack-Cali Limited Partnership dated December 3, 2003 (filed as Exhibit 10.2 to the Corporation’s Form 8-K dated December 3, 2003 and incorporated herein by reference).
10.56	First Amendment to Redevelopment Agreement by and between the New Jersey Sports and Exposition Authority and Meadowlands Mills/Mack-Cali Limited Partnership dated October 5, 2004 (filed as Exhibit 10.54 to the Corporation’s Form 10-Q dated September 30, 2004 and incorporated herein by reference).

123

Exhibit Number	Exhibit Title
10.57	Letter Agreement by and between Mack-Cali Realty Corporation and The Mills Corporation dated October 5, 2004 (filed as Exhibit 10.55 to the Corporation’s Form 10-Q dated September 30, 2004 and incorporated herein by reference).
10.58	First Amendment to Limited Partnership Agreement of Meadowlands Mills/Mack-Cali Limited Partnership by and between Meadowlands Mills Limited Partnership, Mack-Cali Meadowlands Entertainment L.L.C. and Mack-Cali Meadowlands Special L.L.C. dated as of June 30, 2005 (filed as Exhibit 10.66 to the Company’s Form 10-Q dated June 30, 2005 and incorporated herein by reference).
10.59	Mack-Cali Rights, Obligations and Option Agreement by and between Meadowlands Developer Limited Partnership, Meadowlands Limited Partnership, Meadowlands Developer Holding Corp., Meadowlands Mack-Cali GP, L.L.C., Mack-Cali Meadowlands Special, L.L.C., Baseball Meadowlands Mills/Mack-Cali Limited Partnership, A-B Office Meadowlands Mack-Cali Limited Partnership, C-D Office Meadowlands Mack-Cali Limited Partnership, Hotel Meadowlands Mack-Cali Limited Partnership and ERC Meadowlands Mills/Mack-Cali Limited Partnership dated November 22, 2006 (filed as Exhibit 10.92 to the Company’s Form 10-K dated December 31, 2006 and incorporated herein by reference).
10.60	Redemption Agreement by and among Meadowlands Developer Limited Partnership, Meadowlands Developer Holding Corp., Mack-Cali Meadowlands entertainment L.L.C., Mack-Cali Meadowlands Special L.L.C., and Meadowlands Limited Partnership dated November 22, 2006 (filed as Exhibit 10.93 to the Company’s Form 10-K dated December 31, 2006 and incorporated herein by reference).
10.61	Contribution and Exchange Agreement by and between Mack-Cali Realty, L.P. and Tenth Springhill Lake Associates L.L.L.P., Eleventh Springhill Lake Associates L.L.L.P., Twelfth Springhill Lake Associates L.L.L.P., Fourteenth Springhill Lake Associates L.L.L.P., each a Maryland limited liability limited partnership, Greenbelt Associates, a Maryland general partnership, and Sixteenth Springhill Lake Associates L.L.L.P., a Maryland limited liability limited partnership, and certain other natural persons, dated as of November 21, 2005 (filed as Exhibit 10.69 to the Company’s Form 10-K dated December 31, 2005 and incorporated herein by reference).
10.62	Membership Interest Purchase and Contribution Agreement by and among Mr. Stanley C. Gale, SCG Holding Corp., Mack-Cali Realty Acquisition Corp. and Mack-Cali Realty, L.P. dated as of March 7, 2006 (filed as Exhibit 10.1 to the Company’s Form 8-K dated March 7, 2006 and incorporated herein by reference).
10.63	Amendment No. 1 to Membership Interest Purchase and Contribution Agreement dated as of March 31, 2006 (filed as Exhibit 10.1 to the Company’s Form 8-K dated March 28, 2006 and incorporated herein by reference).
10.64	Amendment No. 2 to Membership Interest Purchase and Contribution Agreement dated as of May 9, 2006 (filed as Exhibit 10.1 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).
10.65	Amendment No. 8 to Membership Interest Purchase and Contribution Agreement by and among Mr. Stanley C. Gale, SCG Holding Corp., Mack-Cali Realty Acquisition Corp. and Mack-Cali Realty, L.P. dated as of May 23, 2007 (filed as Exhibit 10.1 to the Company’s Form 8-K dated May 23, 2007 and incorporated herein by reference).

124

Exhibit Number	Exhibit Title
10.66	Contribution and Sale Agreement by and among Gale SLG NJ LLC, a Delaware limited liability company, Gale SLG NJ MEZZ LLC, a Delaware limited liability company, and Gale SLG RIDGEFIELD MEZZ LLC, a Delaware limited liability company and Mack-Cali Ventures L.L.C. dated as of March 7, 2006 (filed as Exhibit 10.2 to the Company’s Form 8-K dated March 7, 2006 and incorporated herein by reference).
10.67	First Amendment to Contribution and Sale Agreement by and among GALE SLG NJ LLC, a Delaware limited liability company, GALE SLG NJ MEZZ LLC, a Delaware limited liability company, and GALE SLG RIDGEFIELD MEZZ LLC, a Delaware limited liability company, and Mack-Cali Ventures L.L.C., a Delaware limited liability company, dated as of May 9, 2006 (filed as Exhibit 10.4 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).
10.68	Non-Portfolio Property Interest Contribution Agreement by and among Mr. Stanley C. Gale, Mr. Mark Yeager, GCF II Investor LLC, The Gale Investments Company, LLC, Gale & Wentworth Vreeland, LLC, Gale Urban Solutions LLC, MSGW-ONE Campus Investors, LLC, Mack-Cali Realty Acquisition Corp. and Mack-Cali Realty, L.P. dated as of May 9, 2006 (filed as Exhibit 10.2 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).
10.69	Loan Agreement by and among the entities set forth on Exhibit A, collectively, as Borrowers, and Gramercy Warehouse Funding I LLC, as Lender, dated May 9, 2006 (filed as Exhibit 10.5 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).
10.70	Promissory Note of One Grande SPE LLC, 1280 Wall SPE LLC, 10 Sylvan SPE LLC, 5 Independence SPE LLC, 1 Independence SPE LLC, and 3 Becker SPE LLC, as Borrowers, in favor of Gramercy Warehouse Funding I, LLC, as Lender, in the principal amount of $90,286,551 dated May 9, 2006 (filed as Exhibit 10.6 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).
10.71	Mortgage, Security Agreement and Fixture Filing by and between 4 Becker SPE LLC, as Borrower, and Wachovia Bank, National Association, as Lender, dated May 9, 2006 (filed as Exhibit 10.7 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).
10.72	Promissory Note of 4 Becker SPE LLC, as Borrower, in favor of Wachovia Bank, National Association, as Lender, in the principal amount of $43,000,000 dated May 9, 2006 (filed as Exhibit 10.8 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).
10.73	Mortgage, Security Agreement and Fixture Filing by and between 210 Clay SPE LLC, as Borrower, and Wachovia Bank, National Association, as Lender, dated May 9, 2006 (filed as Exhibit 10.9 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).
10.74	Promissory Note of 210 Clay SPE LLC, as Borrower, in favor of Wachovia Bank, National Association, as Lender, in the principal amount of $16,000,000 dated May 9, 2006 (filed as Exhibit 10.10 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).
10.75	Mortgage, Security Agreement and Fixture Filing by and between 5 Becker SPE LLC, as Borrower, and Wachovia Bank, National Association, as Lender, dated May 9, 2006 (filed as Exhibit 10.11 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).
10.76	Promissory Note of 5 Becker SPE LLC, as Borrower, in favor of Wachovia Bank, National Association, as Lender, in the principal amount of $15,500,000 dated May 9, 2006 (filed as Exhibit 10.12 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).

125

Exhibit Number	Exhibit Title
10.77	Mortgage, Security Agreement and Fixture Filing by and between 51 CHUBB SPE LLC, as Borrower, and Wachovia Bank, National Association, as Lender, dated May 9, 2006 (filed as Exhibit 10.13 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).
10.78	Promissory Note of 51 CHUBB SPE LLC, as Borrower, in favor of Wachovia Bank, National Association, as Lender, in the principal amount of $4,500,000 dated May 9, 2006 (filed as Exhibit 10.14 to the Company’s Form 8-K dated May 9, 2006 and incorporated herein by reference).
10.79	Agreement of Sale and Purchase dated August 9, 2006 by and between Mack-Cali Realty, L.P. and Westcore Properties AC, LLC (filed as Exhibit 10.91 to the Company’s Form 10-Q dated September 30, 2006 and incorporated herein by reference).
10.80	First Amendment to Agreement of Sale and Purchase dated September 6, 2006 by and between Mack-Cali Realty, L.P. and Westcore Properties AC, LLC (filed as Exhibit 10.92 to the Company’s Form 10-Q dated September 30, 2006 and incorporated herein by reference).
10.81	Second Amendment to Agreement of Sale and Purchase dated September 15, 2006 by and between Mack-Cali Realty, L.P. and Westcore Properties AC, LLC (filed as Exhibit 10.93 to the Company’s Form 10-Q dated September 30, 2006 and incorporated herein by reference).
10.82	Agreement of Sale and Purchase dated September 25, 2006 by and between Phelan Realty Associates L.P., 795 Folsom Realty Associates L.P. and Westcore Properties AC, LLC (filed as Exhibit 10.94 to the Company’s Form 10-Q dated September 30, 2006 and incorporated herein by reference).
10.83	Membership Interest Purchase and Contribution Agreement dated as of December 28, 2006, by and among NKFGMS Owners, LLC, The Gale Construction Services Company, L.L.C., NKFFM Limited Liability Company, Scott Panzer, Ian Marlow, Newmark & Company Real Estate, Inc. d/b/a Newmark Knight Frank, and Mack-Cali Realty, L.P (filed as Exhibit 10.117 to the Company’s Form 10-K dated December 31, 2006 and incorporated herein by reference).
10.84	Operating Agreement of NKFGMS Owners, LLC (filed as Exhibit 10.118 to the Company’s Form 10-K dated December 31, 2006 and incorporated herein by reference).
10.85	Loans, Sale and Services Agreement dated December 28, 2006 by and between Newmark & Company Real Estate, Inc. d/b/a Newmark Knight Frank, Mack-Cali Realty, L.P., and Newmark Knight Frank Global Management Services, LLC (filed as Exhibit 10.119 to the Company’s Form 10-K dated December 31, 2006 and incorporated herein by reference).
10.86	Term Loan Agreement among Mack-Cali Realty, L.P. and JPMorgan Chase Bank, N.A. as Administrative Agent, J.P. Morgan Securities Inc. as Arranger, and other lender which may become parties to this Agreement dated November 29, 2006 (filed as Exhibit 10.120 to the Company’s Form 10-K dated December 31, 2006 and incorporated herein by reference).
10.87	Agreement of Purchase and Sale among SLG Broad Street A LLC and SLG Broad Street C LLC, as Sellers, and M-C Broad 125 A L.L.C. and M-C Broad 125 C L.L.C., as Purchasers, dated as of March 15, 2007 (filed as Exhibit 10.121 to the Company’s Form 10-Q dated March 31, 2007 and incorporated herein by reference).
10.88	Agreement of Purchase and Sale among 500 West Putnam L.L.C., as Seller, and SLG 500 West Putnam LLC, as Purchaser, dated as of March 15, 2007 (filed as Exhibit 10.122 to the Company’s Form 10-Q dated March 31, 2007 and incorporated herein by reference).

126

Exhibit Number	Exhibit Title
10.89	Letter Agreement by and between Mack-Cali Realty, L.P., Mack-Cali Realty Acquisition Corp., Mack-Cali Belmar Realty, LLC, M-C Belmar, LLC, Mr. Stanley C. Gale, SCG Holding Corp., Mr. Mark Yeager, GCF II Investor LLC, The Gale Investments Company, LLC, Gale & Wentworth Vreeland, LLC, Gale Urban Solutions LLC, MSGW-ONE Campus Investors, LLC and Gale/Yeager Investments LLC dated October 31, 2007 (filed as Exhibit 10.128 to the Company’s Form 10-Q dated September 30, 2007 and incorporated herein by reference).
10.90	Mortgage and Security Agreement and Financing Statement dated October 28, 2008 between M-C Plaza V L.L.C., Cal-Harbor V Urban Renewal Associates, L.P., Cal-Harbor V Leasing Associates L.L.C., as Mortgagors and The Northwestern Mutual Life Insurance Company and New York Life Insurance Company as Mortgagees (filed as Exhibit 10.131 to the Company’s Form 10-Q dated September 30, 2008 and incorporated herein by reference).
10.91	Promissory Note of M-C Plaza V L.L.C., Cal-Harbor V Urban Renewal Associates, L.P., Cal-Harbor V Leasing Associates L.L.C., as Borrowers, in favor of The Northwestern Mutual Life Insurance Company, as Lender, in the principal amount of $120,000,000, dated October 28, 2008. (filed as Exhibit 10.132 to the Company’s Form 10-Q dated September 30, 2008 and incorporated herein by reference).
10.92	Promissory Note of M-C Plaza V L.L.C., Cal-Harbor V Urban Renewal Associates, L.P., Cal-Harbor V Leasing Associates L.L.C., as Borrowers, in favor of New York Life Insurance Company, as Lender, in the principal amount of $120,000,000, dated October 28, 2008 (filed as Exhibit 10.133 to the Company’s Form 10-Q dated September 30, 2008 and incorporated herein by reference).
10.93	Guarantee of Recourse Obligations of Mack-Cali Realty, L.P. in favor of The Northwestern Mutual Life Insurance Company and New York Life Insurance Company dated October 28, 2008 (filed as Exhibit 10.134 to the Company’s Form 10-Q dated September 30, 2008 and incorporated herein by reference).
10.94	Amended and Restated Loan Agreement by and among One Grande SPE LLC, 1280 Wall SPE LLC, 10 Sylvan SPE LLC, 5 Independence SPE LLC, 1 Independence SPE LLC, and 3 Becker SPE LLC, collectively, as Borrowers and Gramercy Warehouse Funding I LLC, as Lender, dated April 29, 2009 (filed as Exhibit 10.144 to the Company’s Form 10-Q dated March 31, 2009 and incorporated herein by reference).
10.95	Amended and Restated Promissory Note of One Grande SPE LLC, 1280 Wall SPE LLC, 10 Sylvan SPE LLC, 5 Independence SPE LLC, 1 Independence SPE LLC, and 3 Becker SPE LLC, as Borrowers, in favor of Gramercy Warehouse Funding I, LLC, as Lender, dated April 29, 2009 (filed as Exhibit 10.145 to the Company’s Form 10-Q dated March 31, 2009 and incorporated herein by reference).
10.96	Limited Liability Company Membership Interest Purchase and Sale Agreement dated April 29, 2009 by and among Gale SLG NJ LLC, Mack-Cali Ventures L.L.C., SLG Gale 55 Corporation LLC and 55 Corporate Partners L.L.C.  (filed as Exhibit 10.146 to the Company’s Form 10-Q dated March 31, 2009 and incorporated herein by reference).
10.97	Amended and Restated Master Loan Agreement dated as of January 15, 2010 among Mack-Cali Realty, L.P., and Affiliates of Mack-Cali Realty Corporation and Mack-Cali Realty, L.P., as Borrowers, Mack-Cali Realty Corporation and Mack-Cali Realty L.P., as Guarantors and The Prudential Insurance Company of America and VPCM, LLC, as Lenders (filed as Exhibit 10.1 to the Company’s Form 8-K dated January 15, 2010 and incorporated herein by reference).

127

Exhibit Number	Exhibit Title
10.98	Partial Recourse Guaranty of Mack-Cali Realty, L.P. dated as of January 15, 2010 to The Prudential Insurance Company of America and VPCM, LLC (filed as Exhibit 10.2 to the Company’s Form 8-K dated January 15, 2010 and incorporated herein by reference).
10.99	Amended, Restated and Consolidated Mortgage and Security Agreement and Financing Statement dated as of January 15, 2010 by Mack-Cali Realty, L.P., as Borrower, to The Prudential Insurance Company of America and VPCM, LLC, as Mortgagees with respect to Mack-Cali Centre I in Bergen County, New Jersey (filed as Exhibit 10.165 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.100	Amended, Restated and Consolidated Mortgage and Security Agreement and Financing Statement dated as of January 15, 2010 by Mack-Cali Realty, L.P., as Borrower, to The Prudential Insurance Company of America and VPCM, LLC, as Mortgagees with respect to Mack-Cali Centre II in Bergen County, New Jersey (filed as Exhibit 10.166 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.101	Amended, Restated and Consolidated Mortgage and Security Agreement and Financing Statement dated as of January 15, 2010 by Mack-Cali Realty, L.P., as Borrower, to The Prudential Insurance Company of America and VPCM, LLC, as Mortgagees with respect to Mack-Cali Centre III in Bergen County, New Jersey (filed as Exhibit 10.167 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.102	Amended, Restated and Consolidated Mortgage and Security Agreement and Financing Statement dated as of January 15, 2010 by Mack-Cali Realty, L.P., as Borrower, to The Prudential Insurance Company of America and VPCM, LLC, as Mortgagees with respect to Mack-Cali Centre IV in Bergen County, New Jersey filed as Exhibit 10.168 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.103	Amended, Restated and Consolidated Mortgage and Security Agreement and Financing Statement dated as of January 15, 2010 by Mack-Cali F Properties, L.P., as Borrower, to The Prudential Insurance Company of America and VPCM, LLC, as Mortgagees with respect to Mack-Cali Centre VII in Bergen County, New Jersey (filed as Exhibit 10.169 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.104	Amended, Restated and Consolidated Mortgage and Security Agreement and Financing Statement dated as of January 15, 2010 by Mack-Cali Chestnut Ridge, L.L.C., as Borrower, to The Prudential Insurance Company of America and VPCM, LLC, as Mortgagees with respect to Mack-Cali Corp. Center in Bergen County, New Jersey (filed as Exhibit 10.170 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.105	Amended, Restated and Consolidated Mortgage and Security Agreement and Financing Statement dated as of January 15, 2010 by Mack-Cali Realty, L.P., as Borrower, to The Prudential Insurance Company of America and VPCM, LLC, as Mortgagees with respect to Mack-Cali Saddle River in Bergen County, New Jersey (filed as Exhibit 10.171 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.106	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali Realty, L.P. in favor of The Prudential Insurance Company of America with respect to Mack-Cali Centre I in Bergen County, New Jersey  (filed as Exhibit 10.172 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).

128

Exhibit Number	Exhibit Title
10.107	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali Realty, L.P. in favor of VPCM, LLC with respect to Mack-Cali Centre I in Bergen County, New Jersey  (filed as Exhibit 10.173 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.108	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali Realty, L.P. in favor of The Prudential Insurance Company of America with respect to Mack-Cali Centre II in Bergen County, New Jersey  (filed as Exhibit 10.174 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.109	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali Realty, L.P. in favor of VPCM, LLC with respect to Mack-Cali Centre II in Bergen County, New Jersey  (filed as Exhibit 10.175 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.110	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali Realty, L.P. in favor of The Prudential Insurance Company of America with respect to Mack-Cali Centre III in Bergen County, New Jersey  (filed as Exhibit 10.176 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.111	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali Realty, L.P. in favor of VPCM, LLC with respect to Mack-Cali Centre III in Bergen County, New Jersey  (filed as Exhibit 10.177 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.112	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali Realty, L.P. in favor of The Prudential Insurance Company of America with respect to Mack-Cali Centre IV in Bergen County, New Jersey  (filed as Exhibit 10.178 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.113	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali Realty, L.P. in favor of VPCM, LLC with respect to Mack-Cali Centre IV in Bergen County, New Jersey  (filed as Exhibit 10.179 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.114	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali F Properties, L.P. in favor of The Prudential Insurance Company of America with respect to Mack-Cali Centre VII in Bergen County, New Jersey  (filed as Exhibit 10.180 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.115	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali F Properties, L.P. in favor of VPCM, LLC with respect to Mack-Cali Centre VII in Bergen County, New Jersey  (filed as Exhibit 10.181 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.116	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali Chestnut Ridge, L.L.C. in favor of The Prudential Insurance Company of America with respect to Mack-Cali Corp. Center in Bergen County, New Jersey  (filed as Exhibit 10.182 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).

129

Exhibit Number	Exhibit Title
10.117	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali Chestnut Ridge, L.L.C. in favor of VPCM, LLC with respect to Mack-Cali Corp. Center in Bergen County, New Jersey (filed as Exhibit 10.183 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.118	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali Realty, L.P. in favor of The Prudential Insurance Company of America with respect to Mack-Cali Saddle River in Bergen County, New Jersey (filed as Exhibit 10.184 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.119	Amended, Restated and Consolidated Promissory Note dated January 15, 2010 of Mack-Cali Realty, L.P. in favor of VPCM, LLC with respect to Mack-Cali Saddle River in Bergen County, New Jersey (filed as Exhibit 10.185 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.120	Recourse Liabilities Guaranty dated January 15, 2010 of Mack-Cali Realty Corporation and Mack-Cali Realty, L.P. to The Prudential Insurance Company of America and VPCM, LLC with respect to certain liabilities of Mack-Cali Realty, L.P. with respect to Mack-Cali Centre I in Bergen County, New Jersey (filed as Exhibit 10.186 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.121	Recourse Liabilities Guaranty dated January 15, 2010 of Mack-Cali Realty Corporation and Mack-Cali Realty, L.P. to The Prudential Insurance Company of America and VPCM, LLC with respect to certain liabilities of Mack-Cali Realty, L.P. with respect to Mack-Cali Centre II in Bergen County, New Jersey (filed as Exhibit 10.187 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.122	Recourse Liabilities Guaranty dated January 15, 2010 of Mack-Cali Realty Corporation and Mack-Cali Realty, L.P. to The Prudential Insurance Company of America and VPCM, LLC with respect to certain liabilities of Mack-Cali Realty, L.P. with respect to Mack-Cali Centre III in Bergen County, New Jersey (filed as Exhibit 10.188 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.123	Recourse Liabilities Guaranty dated January 15, 2010 of Mack-Cali Realty Corporation and Mack-Cali Realty, L.P. to The Prudential Insurance Company of America and VPCM, LLC with respect to certain liabilities of Mack-Cali Realty, L.P. with respect to Mack-Cali Centre IV in Bergen County, New Jersey (filed as Exhibit 10.189 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.124	Recourse Liabilities Guaranty dated January 15, 2010 of Mack-Cali Realty Corporation and Mack-Cali Realty, L.P. to The Prudential Insurance Company of America and VPCM, LLC with respect to certain liabilities of Mack-Cali F Properties, L.P. with respect to Mack-Cali Centre VII in Bergen County, New Jersey (filed as Exhibit 10.190 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.125	Recourse Liabilities Guaranty dated January 15, 2010 of Mack-Cali Realty Corporation and Mack-Cali Realty, L.P. to The Prudential Insurance Company of America and VPCM, LLC with respect to certain liabilities of Mack-Cali Chestnut Ridge, L.L.C. with respect to Mack-Cali Corp. Center in Bergen County, New Jersey (filed as Exhibit 10.191 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).

130

Exhibit Number	Exhibit Title
10.126	Recourse Liabilities Guaranty dated January 15, 2010 of Mack-Cali Realty Corporation and Mack-Cali Realty, L.P. to The Prudential Insurance Company of America and VPCM, LLC with respect to certain liabilities of Mack-Cali Realty, L.P. with respect to Mack-Cali Saddle River in Bergen County, New Jersey (filed as Exhibit 10.192 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.127	Amended and Restated Irrevocable Cross Collateral Guaranty of Payment and Performance dated January 15, 2010 of Mack-Cali Realty, L.P. to The Prudential Insurance Company of America and VPCM, LLC with respect to Mack-Cali Centre I in Bergen County, New Jersey (filed as Exhibit 10.193 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.128	Amended and Restated Irrevocable Cross Collateral Guaranty of Payment and Performance dated January 15, 2010 of Mack-Cali Realty, L.P. to The Prudential Insurance Company of America and VPCM, LLC with respect to Mack-Cali Centre II in Bergen County, New Jersey (filed as Exhibit 10.194 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.129	Amended and Restated Irrevocable Cross Collateral Guaranty of Payment and Performance dated January 15, 2010 of Mack-Cali Realty, L.P. to The Prudential Insurance Company of America and VPCM, LLC with respect to Mack-Cali Centre III in Bergen County, New Jersey (filed as Exhibit 10.195 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.130	Amended and Restated Irrevocable Cross Collateral Guaranty of Payment and Performance dated January 15, 2010 of Mack-Cali Realty, L.P. to The Prudential Insurance Company of America and VPCM, LLC with respect to Mack-Cali Centre IV in Bergen County, New Jersey (filed as Exhibit 10.196 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.131	Amended and Restated Irrevocable Cross Collateral Guaranty of Payment and Performance dated January 15, 2010 of Mack-Cali F Properties, L.P. to The Prudential Insurance Company of America and VPCM, LLC with respect to Mack-Cali Centre VII in Bergen County, New Jersey (filed as Exhibit 10.197 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.132	Amended and Restated Irrevocable Cross Collateral Guaranty of Payment and Performance dated January 15, 2010 of Mack-Cali Chestnut Ridge, L.L.C. to The Prudential Insurance Company of America and VPCM, LLC with respect to Mack-Cali Corp. Center in Bergen County, New Jersey (filed as Exhibit 10.198 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
10.133	Amended and Restated Irrevocable Cross Collateral Guaranty of Payment and Performance dated January 15, 2010 of Mack-Cali Realty, L.P. to The Prudential Insurance Company of America and VPCM, LLC with respect to Mack-Cali Saddle River in Bergen County, New Jersey (filed as Exhibit 10.199 to the Company’s Form 10-Q dated September 30, 2010 and incorporated herein by reference).
12.1*	Calculation of Ratios of Earnings to Fixed Charges.
12.2*	Calculation of Ratios of Earnings to Combined Fixed Charges and Preferred Security Dividends.

131

Exhibit Number	Exhibit Title
21.1*	Subsidiaries of the Company.
23.1*	Consent of PricewaterhouseCoopers LLP, independent registered public accounting firm.
23.2*	Consent of Cornerstone Accounting Group LLP, independent registered public accounting firm.
31.1*	Certification of the Corporation’s President and Chief Executive Officer, Mitchell E. Hersh, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of the Corporation’s Chief Financial Officer, Barry Lefkowitz, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification of the Corporation’s President and Chief Executive Officer, Mitchell E. Hersh, and the Corporation’s Chief Financial Officer, Barry Lefkowitz, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
99.1*	Mack-Green-Gale LLC and Subsidiaries Consolidated Balance Sheets at December 31, 2008 and 2007 and Consolidated Statements of Operations, Changes in Members' Capital and Cash Flows for the years ended December 31, 2008 and 2007 and for the period from May 9, 2006 (Commencement of Operations) through December 31, 2006, including the report of independent registered public accounting firm.
99.2*	Mack-Green-Gale LLC and Subsidiaries Consolidated Balance Sheet at April 28, 2009 and Consolidated Statements of Operations, Changes in Members' Capital and Cash Flows for the period January 1, 2009 through April 28, 2009 (Date of Consolidation) (unaudited).
101.1*	The following financial statements from Mack-Cali Realty, L.P.’s Annual Report on Form 10-K for the year ended December 31, 2010, formatted in XBRL: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statement of Changes in Equity, (iv) Consolidated Statements of Cash Flows, and (v) Notes to Consolidated Financial Statements, tagged as blocks of text.

* filed herewith

132

EX-12.1

Exhibit 12.1

MACK-CALI REALTY, L.P.

 CALCULATION OF RATIOS OF EARNINGS TO FIXED CHARGES

 (DOLLAR AMOUNTS IN THOUSANDS)

Mack-Cali Realty Corporation's ratios of earnings to fixed charges for each of the five years ended December 31, 2010 were as follows:

	For the Year Ended December 31,
	2010	2009	2008	2007	2006
EARNINGS:
ADD:
Income from continuing operations before minority interest
and equity in earnings from unconsolidated joint ventures	$  56,474	$   85,868	$ 105,142	$   94,708	$ 110,928
Fixed charges (see calculation below)	151,404	141,714	132,970	130,789	140,488
Amortization of capitalized interest	2,070	2,028	1,950	1,849	1,750
Distributed income of unconsolidated joint ventures	2,311	2,637	5,784	1,875	2,302
SUBTRACT:
Capitalization interest	(1,912)	(1,401)	(5,799)	(5,101)	(6,058)
TOTAL EARNINGS:	$ 210,347	$ 230,846	$ 240,047	$ 224,120	$ 249,410
FIXED CHARGES:
Interest expense (includes amortization of deferred financing costs)	$ 149,329	$ 140,068	$ 126,937	$ 125,467	$ 134,197
Capitalized interest	1,912	1,401	5,799	5,101	6,058
Interest portion (33 percent) of ground rents on land leases	163	245	234	221	233
TOTAL FIXED CHARGES:	$ 151,404	$ 141,714	$ 132,970	$ 130,789	$ 140,488
RATIO OF EARNINGS TO FIXED CHARGES:	1.4	1.6	1.8	1.7	1.8

EX-12.2

Exhibit 12.2

MACK-CALI REALTY, L.P.

 CALCULATION OF RATIOS OF EARNINGS TO COMBINED FIXED CHARGES AND

 PREFERRED UNIT DISTRIBUTIONS

 (DOLLAR AMOUNTS IN THOUSANDS)

Mack-Cali Realty Corporation's ratios of earnings to combined fixed charges and preferred stock dividends for each of the five years ended December 31, 2010 were as follows:

	For the Year Ended December 31,
	2010	2009	2008	2007	2006
EARNINGS:
ADD:
Income from continuing operations before minority interest
and equity in earnings from unconsolidated joint ventures	$  56,474	$   85,868	$ 105,142	$   94,708	$ 110,928
Fixed charges (see calculation below)	151,404	141,714	132,970	130,789	140,488
Amortization of capitalized interest	2,070	2,028	1,950	1,849	1,750
Distributed income of unconsolidated joint ventures	2,311	2,637	5,784	1,875	2,302
SUBTRACT:
Capitalization interest	(1,912)	(1,401)	(5,799)	(5,101)	(6,058)
TOTAL EARNINGS:	$ 210,347	$ 230,846	$ 240,047	$ 224,120	$ 249,410
FIXED CHARGES:
Interest expense (includes amortization of deferred financing costs)	$ 149,329	$ 140,068	$ 126,937	$ 125,467	$ 134,197
Capitalized interest	1,912	1,401	5,799	5,101	6,058
Interest portion (33 percent) of ground rents on land leases	163	245	234	221	233
TOTAL FIXED CHARGES:	$ 151,404	$ 141,714	$ 132,970	$ 130,789	$ 140,488
Preferred unit distributions	2,000	2,000	2,000	2,000	2,000
TOTAL COMBINED FIXED CHARGES AND PREFERRED
UNIT DISTRIBUTIONS:	$  153,404	$ 143,714	$ 134,970	$ 132,789	$ 142,488
RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED UNIT DISTRIBUTIONS:	1.4	1.6	1.8	1.7	1.8

EX-21.1

Exhibit 21.1

MACK-CALI REALTY, L.P.

Subsidiary	State of Incorporation  or Organization
1 COMMERCE REALTY L.L.C.	NJ
1 EXECUTIVE REALTY L.L.C.	NJ
1 JEFFERSON REALTY L.L.C.	NJ
1 INDEPENDENCE SPE LLC	DE
2 COMMERCE REALTY L.L.C.	NJ
2 EXECUTIVE REALTY L.L.C.	NJ
2 PARAGON REALTY L.L.C.	DE
2 TWOSOME REALTY L.L.C.	NJ
2 INDEPENDENCE SPE LLC	DE
3 CAMPUS REALTY LLC	DE
3 ODELL REALTY L.L.C.	NY
3 PARAGON REALTY L.L.C.	DE
3 BECKER SPE LLC	DE
4 GATEHALL REALTY L.L.C.	NJ
4 PARAGON REALTY L.L.C.	NJ
4 SENTRY HOLDING L.L.C.	DE
4 SENTRY REALTY L.L.C.	DE
4 BECKER SPE LLC	DE
4 SYLVAN SPE LLC	DE
5 WOOD HOLLOW REALTY, L.L.C.	NJ
5 BECKER SPE LLC	DE
5 INDEPENDENCE SPE LLC	DE
5/6 SKYLINE REALTY L.L.C.	NY
6 BECKER SPE LLC	DE
6 PARSIPPANY L.L.C.	NJ
9 CAMPUS REALTY L.L.C.	NJ
10 INDEPENDENCE SPE LLC	DE
10 SYLVAN SPE LLC	DE
11 COMMERCE DRIVE ASSOCIATES L.L.C.	NJ
12 SKYLINE ASSOCIATES L.L.C.	NY
12 VREELAND REALTY L.L.C.	DE
14/16 SKYLINE REALTY L.L.C.	NY
14 COMMERCE REALTY L.L.C.	NJ
20 COMMERCE DRIVE ASSOCIATES L.L.C.	NJ
20 WATERVIEW SPE LLC	DE
25 COMMERCE REALTY, L.L.C.	NJ
30 TWOSOME REALTY L.L.C.	NJ
31 TWOSOME REALTY L.L.C.	NJ
35 WATERVIEW HOLDING L.L.C.	DE
35 WATERVIEW SPE LLC	DE
40 TWOSOME REALTY L.L.C.	NJ
41 TWOSOME REALTY L.L.C.	NJ
50 TWOSOME REALTY L.L.C.	NJ
51 CHUBB SPE LLC	DE
55 CORPORATE REALTY L.L.C.	DE
75 LIVINGSTON SPE LLC	DE
78/PINSON PARTNERS L.L.C.	NJ
85 LIVINGSTON SPE LLC	DE
97 FORSTER REALTY L.L.C.	NJ
100 KIMBALL REALTY L.L.C.	NJ
100 WILLOWBROOK REALTY L.L.C.	DE
101 COMMERCE REALTY L.L.C.	NJ
101 EXECUTIVE REALTY L.L.C.	NJ
102 EXECUTIVE REALTY L.L.C.	NJ

Subsidiary State of Incorporation  or Organization

120 PASSAIC STREET L.L.C.	NJ
201 COMMERCE REALTY L.L.C.	NJ
201 WILLOWBROOK FUNDING L.L.C.	NJ
210 CLAY SPE LLC	DE
225 CORPORATE REALTY L.L.C.	NY
225 EXECUTIVE REALTY L.L.C.	NJ
232 STRAWBRIDGE REALTY L.L.C.	NJ
300 HORIZON REALTY L.L.C.	NJ
300 TICE REALTY ASSOCIATES L.L.C.	NJ
343 THORNALL HOLDING L.L.C.	DE
343 THORNALL SPE LLC	DE
395 W. PASSAIC L.L.C.	NJ
400 CHESTNUT REALTY L.L.C.	NJ
400 RELLA REALTY ASSOCIATES L.L.C.	NY
461 FROM REALTY L.L.C.	NJ
470 CHESTNUT REALTY L.L.C.	NJ
500 COLUMBIA TURNPIKE ASSOCIATES L.L.C.	NJ
530 CHESTNUT REALTY L.L.C.	NJ
600 HORIZON CENTER L.L.C.	NJ
600 PARSIPPANY ASSOCIATES L.L.C.	NJ
1256 N. CHURCH REALTY L.L.C.	NJ
1266 SOUNDVIEW REALTY L.L.C.	CT
1280 WALL SPE LLC	DE
1507 LANCER REALTY L.L.C.	NJ
1717 REALTY ASSOCIATES L.L.C.	NJ
A-B OFFICE MEADOWLANDS MACK-CALI LIMITED PARTNERSHIP	DE
AIRPORT PROPERTIES ASSOCIATES L.L.C.	NJ
BMP MOORESTOWN REALTY L.L.C.	NJ
BMP SOUTH REALTY L.L.C.	NJ
BRIDGE PLAZA REALTY ASSOCIATES L.L.C.	NJ
C.W. ASSOCIATES L.L.C.	NJ
C-D OFFICE MEADOWLANDS MACK-CALI LIMITED PARTNERSHIP	DE
CAL-HARBOR II & III URBAN RENEWAL ASSOCIATES L.P.	NJ
CAL-HARBOR IV URBAN RENEWAL ASSOCIATES L.P.	NJ
CAL-HARBOR SO. PIER URBAN RENEWAL ASSOCIATES L.P.	NJ
CAL-HARBOR V LEASING ASSOCIATES L.L.C.	NJ
CAL-HARBOR V URBAN RENEWAL ASSOCIATES L.P.	NJ
CAL-HARBOR VI URBAN RENEWAL ASSOCIATES L.P.	NJ
CAL-HARBOR VII LEASING ASSOCIATES L.L.C.	NJ
CAL-HARBOR VII URBAN RENEWAL ASSOCIATES L.P.	NJ
CALI HARBORSIDE (FEE) ASSOCIATES L.P.	NJ
CAMPUS CONSERVATION AND MANAGEMENT, INC.	NJ
CENTURY PLAZA ASSOCIATES L.L.C.	NJ
CLEARBROOK ROAD ASSOCIATES L.L.C.	NY
COLLEGE ROAD REALTY L.L.C.	NJ
COMMERCENTER REALTY ASSOCIATES L.L.C.	NJ
CROSS WESTCHESTER REALTY ASSOCIATES L.L.C.	NY
CWLT ROSELAND EXCHANGE L.L.C.	NJ
D.B.C. REALTY L.L.C.	NJ
ELEVENTH SPRINGHILL LAKE ASSOCIATES, LLC	MD
ELMSFORD REALTY ASSOCIATES L.L.C.	NY
EMPIRE STATE VEHICLE LEASING L.L.C.	NY
FIVE SENTRY REALTY ASSOCIATES L.P.	PA
FOURTEENTH SPRINGHILL LAKE ASSOCIATES L.L.C.	DE
GALE SLG NJ GP LLC	DE
GALE SLG NJ MEZZ LLC	DE

Subsidiary State of Incorporation  or Organization

GALE SLG NJ OPERATING PARTNERSHIP, L.P.	DE
GARDEN STATE VEHICLE LEASING L.L.C.	NJ
GREENBELT/SPRINGHILL LAKE ASSOCIATES L.L.C.	MD
HORIZON CENTER REALTY ASSOCIATES L.L.C.	NJ
JUMPING BROOK REALTY ASSOCIATES L.L.C.	NJ
K US REALTY HOLDING L.L.C.	DE
KEMBLE PLAZA II REALTY L.L.C.	NJ
KEYSTONE VEHICLE LEASING L.L.C.	PA
KNIGHTSBRIDGE REALTY L.L.C.	NJ
LINWOOD REALTY L.L.C.	NJ
LITTLETON REALTY ASSOCIATES L.L.C.	NJ
M-C 2 SOUTH GOLD L.L.C.	NJ
M-C 3 AAA L.L.C.	NJ
M-C 3 CAMPUS, LLC	DE
M-C 5 AAA L.L.C.	NJ
M-C 6 AAA L.L.C.	NJ
M-C 125 BROAD A L.L.C.	DE
M-C 125 BROAD C L.L.C.	DE
M-C CAPITOL ASSOCIATES L.L.C.	DE
M-C CHURCH REALTY L.L.C.	NJ
M-C CONSTRUCTION SERVICES L.L.C.	NJ
M-C HARBORSIDE PROMENADE LLC	NJ
M-C HARSIMUS PARTNERS L.L.C.	NJ
M-C HUDSON LLC	NJ
M-C HUDSON STREET LLC	NJ
M-C JEFFERSON L.L.C.	DE
M-C KIMBALL, LLC	DE
M-C LENOLA REALTY L.L.C.	NJ
M-C METROPOLITAN REALTY L.L.C.	NJ
M-C NEWARK L.L.C.	DE
M-C PENN MANAGEMENT TRUST	MD
M-C PLAZA II & III LLC	NJ
M-C PLAZA IV LLC	NJ
M-C PLAZA V LLC	NJ
M-C PLAZA VI & VII LLC	NJ
M-C PROPERTIES CO. REALTY L.L.C.	NJ
M-C RED BANK REALTY L.L.C.	NJ
M-C ROSETREE REALTY ASSOCIATES L.P.	PA
M-C TRANSIT, LLC	DE
M-C VREELAND, LLC	DE
M-C WASHINGTON STREET L.L.C.	DE
MACK-CALI ADVANTAGE SERVICES CORPORATION	DE
MACK-CALI AIRPORT REALTY ASSOCIATES L.P.	PA
MACK-CALI B PROPERTIES, L.L.C.	NJ
MACK-CALI BRIDGEWATER REALTY, L.P.	NJ
MACK-CALI BUILDING V ASSOCIATES L.L.C.	NJ
MACK-CALI BUSINESS CAMPUS ASSOCIATION, INC.	NJ
MACK-CALI CAMPUS REALTY L.L.C.	NJ
MACK-CALI CHESTNUT RIDGE, L.L.C.	NJ
MACK-CALI CW REALTY ASSOCIATES L.L.C.	NY
MACK-CALI D.C. MANAGEMENT CORP	DE
MACK-CALI E-COMMERCE L.L.C.	DE
MACK-CALI EAST LAKEMONT L.L.C.	NJ
MACK-CALI F PROPERTIES L.P.	NJ
MACK-CALI FACILITY, LLC	NJ
MACK-CALI FREEHOLD L.L.C.	NJ
MACK-CALI GLENDALE LIMITED PARTNERSHIP	AZ
MACK-CALI HOLMDEL L.L.C.	DE

Subsidiary State of Incorporation  or Organization

MACK-CALI JOHNSON ROAD L.L.C.	NJ
MACK-CALI MANAGEMENT L.L.C.	DE
MACK-CALI MEADOWLANDS ENTERTAINMENT L.L.C.	NJ
MACK-CALI MEADOWLANDS SPECIAL L.L.C.	NJ
MACK-CALI MID-WEST REALTY ASSOCIATES L.L.C.	NY
MACK-CALI MORRIS REALTY L.L.C.	NJ
MACK-CALI PENNSYLVANIA REALTY ASSOCIATES L.P.	PA
MACK-CALI PLAZA I L.L.C.	NJ
MACK-CALI PROPERTY TRUST	MD
MACK-CALI REALTY ACQUISITION CORP.	DE
MACK-CALI REALTY CONSTRUCTION CORPORATION	NJ
MACK-CALI SERVICES, INC.	NJ
MACK-CALI SHORT HILLS L.L.C.	NJ
MACK-CALI SO. WEST REALTY ASSOCIATES L.L.C.	NY
MACK-CALI SPRINGING L.L.C.	DE
MACK-CALI TAXTER ASSOCIATES L.L.C.	NY
MACK-CALI TEXAS PROPERTY L.P.	TX
MACK-CALI TRANSIT VILLAGE LLC	DE
MACK-CALI TRS HOLDING CORPORATION	DE
MACK-CALI WOODBRIDGE L.L.C.	NJ
MACK-CALI WP REALTY ASSOCIATES L.L.C.	NY
MACK-CALI-R COMPANY NO. 1 L.P.	NJ
MACK-GREEN-GALE L.L.C.	DE
MAIN-MARTINE MAINTENANCE CORP.	NY
MAPLE 4 CAMPUS REALTY L.L.C.	NJ
MAPLE 6 CAMPUS REALTY L.L.C.	NJ
MC 55 CORPORATE MANAGER L.L.C.	DE
MC HUDSON HOLDING L.L.C.	NJ
MC HUDSON REALTY L.L.C.	NJ
MC ONE RIVER GENERAL L.L.C.	NJ
MC ONE RIVER LIMITED L.L.C.	NJ
MCPT TRS HOLDING CORPORATION	DE
MCPT TRUST	DE
MCRC TRUST	DE
MC-SJP PINSON DEVELOPMENT, L.L.C.	DE
MID-WEST MAINTENANCE CORP.	NY
MID-WESTCHESTER REALTY ASSOCIATES L.L.C.	NY
MONMOUTH/ATLANTIC REALTY ASSOCIATES L.L.C.	NJ
MONUMENT 150 REALTY L.L.C.	DE
MONUMENT HOLDING L.L.C.	DE
MOORESTOWN REALTY ASSOCIATES L.L.C.	NJ
MOUNT AIRY REALTY ASSOCIATES L.L.C.	NJ
MOUNTAINVIEW REALTY L.L.C.	NJ
NEWARK CENTER HOLDING L.L.C.	DE
OFFICE ASSOCIATES L.L.C.	NJ
ONE GRANDE SPE L.L.C.	DE
ONE RIVER ASSOCIATES	NJ
ONE SYLVAN REALTY, L.L.C.	NJ
PALLADIUM REALTY L.L.C.	NJ
PARSIPPANY 4/5 REALTY L.L.C.	NJ
PARSIPPANY CAMPUS REALTY ASSOCIATES L.L.C.	NJ
PHELAN REALTY ASSOCIATES L.P.	CA
PLAZA VIII & IX ASSOCIATES L.L.C.	NJ
PRINCETON CORPORATE CENTER REALTY ASSOCIATES L.L.C.	NJ
PRINCETON JUNCTION METRO OFFICE CENTER ASSOCIATES, INC.	NJ
PRINCETON OVERLOOK REALTY L.L.C.	NJ

Subsidiary State of Incorporation  or Organization

ROSELAND II L.L.C.	NJ
ROSELAND OWNERS ASSOCIATES L.L.C.	NJ
SENTRY PARK WEST L.L.C.	PA
SIX COMMERCE DRIVE ASSOCIATES L.L.C.	NJ
SIXTEENTH SPRINGHILL LAKES ASSOCIATES L.L.C.	MD
SKYLINE REALTY L.L.C.	NY
SO. WESTCHESTER REALTY ASSOCIATES L.L.C.	NY
SOUTH-WEST MAINTENANCE CORP.	NY
STEVENS AIRPORT REALTY ASSOCIATES L.P.	PA
SYLVAN/CAMPUS REALTY L.L.C.	NJ
TALLEY MAINTENANCE CORP.	NY
TALLEYRAND REALTY ASSOCIATES L.L.C.	NY
TENTH SPRINGHILL LAKE ASSOCIATES, LLC	DE
TERRI REALTY ASSOCIATES L.L.C.	NJ
THE GALE COMPANY, L.L.C.	NJ
THE GALE CONSTRUCTION COMPANY, L.L.C.	DE
THE GALE CONSTRUCTION SERVICES COMPANY, L.L.C.	DE
THE GALE CONTRACTING COMPANY, L.L.C.	DE
THE GALE INVESTMENT SERVICES COMPANY, L.L.C.	DE
THE GALE MANAGEMENT COMPANY, L.L.C.	DE
THE GALE REAL ESTATE ADVISORS COMPANY, L.L.C.	DE
THE GALE REAL ESTATE SERVICES COMPANY L.L.C.	DE
THE GALE SERVICES COMPANY, L.L.C.	DE
THE HORIZON CENTER PROPERTY OWNERS ASSOCIATION, INC.	NJ
TRIAD REALTY ASSOCIATES L.L.C.	DE
TRIAD REALTY HOLDINGS L.L.C.	DE
TWELFTH SPRINGHILL LAKE ASSOCIATES, LLC	MD
VAUGHN PARTNERS L.L.C.	NJ
VAUGHN PRINCETON ASSOCIATES L.L.C.	NJ
WEST AVENUE REALTY ASSOCIATES L.L.C.	CT
WEST-AVE. MAINTENANCE CORP.	CT
WHITE PLAINS REALTY ASSOCIATES L.L.C.	NY

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statement on Form S-3 (No. 333-155696-01) of Mack-Cali Realty, L.P. of our report dated February 9, 2011 relating to the financial statements, financial statement schedule and the effectiveness of internal control over financial reporting, which appears in this Form 10-K.

/s/ PricewaterhouseCoopers LLP

New York, New York

February 9, 2011

EX-23.2

Exhibit 23.2

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statement on Form S-3 (No. 333-155696-01) of Mack-Cali Realty, L.P. of our report dated February 9, 2009 relating to the financial statements of Mack-Green-Gale LLC which appears in this Form 10-K.

/s/ Cornerstone Accounting Group LLP

New York, New York

February 9, 2011

EX-31.1

Exhibit 31.1

MACK-CALI REALTY, L.P.

Certification

I, Mitchell E. Hersh, certify that:

1.   I have reviewed this annual report on Form 10-K of Mack-Cali Realty, L.P.;

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.   The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.   The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:           February 9, 2011	By:	/s/ Mitchell E. Hersh
		Mitchell E. Hersh
		President and Chief Executive Officer
		of Mack-Cali Realty Corporation,
		the general partner of Mack-Cali Realty, L.P.

EX-31.2

Exhibit 31.2

MACK-CALI REALTY, L.P.

Certification

I, Barry Lefkowitz, certify that:

1.   I have reviewed this annual report on Form 10-K of Mack-Cali Realty, L.P.;

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.   The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.   The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:           February 9, 2011	By:	/s/ Barry Lefkowitz
		Barry Lefkowitz
		Executive Vice President and
		Chief Financial Officer
		of Mack-Cali Realty Corporation,
		the general partner of Mack-Cali Realty, L.P.

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report on Form 10-K of Mack-Cali Realty, L.P. (the “Operating Partnership”) for the year ended December 31, 2010, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Mitchell E. Hersh, as President and Chief Executive Officer of Mack-Cali Realty Corporation, its general partner, and Barry Lefkowitz, as Chief Financial Officer of Mack-Cali Realty Corporation, its general partner, each hereby certifies, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of §13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Operating Partnership.

Date:           February 9, 2011	By:	/s/ Mitchell E. Hersh
		Mitchell E. Hersh
		President and Chief Executive Officer
		of Mack-Cali Realty Corporation,
		the general partner of Mack-Cali Realty, L.P.
Date:           February 9, 2011	By:	/s/ Barry Lefkowitz
		Barry Lefkowitz
		Executive Vice President and
		Chief Financial Officer
		of Mack-Cali Realty Corporation,
		the general partner of Mack-Cali Realty, L.P.

This certification accompanies each Report pursuant to §906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Operating Partnership for purposes of §18 of the Securities Exchange Act of 1934, as amended.

A signed original of this written statement required by §906 has been provided to the Operating Partnership and will be retained by the Operating Partnership and furnished to the Securities and Exchange Commission or its staff upon request.

EX-99.1

Exhibit 99.1

MACK-GREEN-GALE LLC AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS AT DECEMBER 31, 2008 AND 2007 AND

CONSOLIDATED STATEMENTS OF OPERATIONS,

CHANGES IN MEMBERS’ CAPITAL AND

CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2008 AND 2007

AND FOR THE PERIOD FROM MAY 9, 2006 (COMMENCEMENT OF OPERATIONS) THROUGH DECEMBER 31, 2006

MACK-GREEN-GALE LLC AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

TABLE OF CONTENTS

	Page No.
Report of Independent Registered Public Accounting Firm	1
Consolidated Balance Sheets	2
Consolidated Statements of Operations	3
Consolidated Statements of Changes in Members’ Capital	4
Consolidated Statements of Cash Flows	5
Notes to Consolidated Financial Statements	6 - 18

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Members of

Mack-Green-Gale LLC

We have audited the accompanying consolidated balance sheets of Mack-Green-Gale LLC and Subsidiaries (the “Company”) as of December 31, 2008 and 2007 and the related consolidated statements of operations, changes in members’ capital and cash flows for the years ended December 31, 2008 and 2007, and for the period May 9, 2006 (commencement of operations) through December 31, 2006.  These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States of America.  Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement.  An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2008 and 2007, and the results of their operations and their cash flows for the years ended December 31, 2008, 2007, and for the period May 9, 2006 (commencement of operations) through December 31, 2006, in conformity with accounting principles generally accepted in the United States of America.

/s/Cornerstone Accounting Group LLP

New York, New York

February 9, 2009

MACK-GREEN-GALE LLC AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Dollar amounts in thousands)

	December 31,
ASSETS	2008	2007
Investment in real estate, net of accumulated depreciation of $34,332 and $21,612	$   326,912	$368,028
Cash and cash equivalents	2,184	10,794
Restricted cash	10,932	9,141
Accounts receivable, net of allowance for doubtful accounts of $412 and $1,216	367	560
Other assets, net of accumulated amortization of $2,429 and $1,484	14,967	10,751
Acquired favorable lease intangibles, net of accumulated amortization of $18,877 and $12,582	16,941	24,434
	$   372,303	$423,708
LIABILITIES AND MEMBERS’ CAPITAL
Liabilities
Mortgage notes payable	$   276,752	$281,746
Accounts payable and accrued expenses	8,403	8,469
Tenant security deposits	789	677
Prepaid rent	1,701	2,047
Acquired unfavorable lease intangibles, net of accumulated amortization of $7,057 and $4,415	12,912	15,554
	300,557	308,493
Minority Interest	2,384	3,865
Commitments and Contingencies
Members’ Capital	69,362	111,350
	$   372,303	$423,708

The accompanying notes are an integral part of these consolidated financial statements.

2

MACK-GREEN-GALE LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

 (Dollar amounts in thousands)

	Year ended December 31,		Period from May 9, 2006 (commencement of operations) through
Revenues:	2008	2007	December 31, 2006
Base Rents	$    47,055	$   47,708	$    29,538
Escalations and other tenant recoveries	2,703	3,475	1,653
Other income	1,527	422	2,144
	51,285	51,605	33,335
Expenses:
Real estate taxes	5,384	6,246	3,871
Other operating expenses	15,081	15,763	9,791
Interest	17,381	21,218	13,527
Depreciation and amortization	20,433	19,437	14,243
Selling, general and administrative	811	1,768	517
Impairment charge	32,294	---	---
	91,384	64,432	41,949
Gain on sale of investment in joint venture	---	1,054	---
Minority interest	1,357	415	298
Loss from continuing operations	(38,742)	(11,358)	(8,316)
Discontinued operations (net of minority interest):
Loss from operations of properties	---	(3,261)	(4,775)
(Loss)/Gain from sale of real estate	---	(21,559)	422
Net Loss	$ (38,742)	$ (36,178)	$ (12,669)

The accompanying notes are an integral part of these consolidated financial statements.

3

MACK-GREEN-GALE LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN MEMBERS’ CAPITAL

(Dollar amounts in thousands)

	Mack-Cali Ventures L.L.C.	Gale SLG NJ LLC	Total
Initial Capital Contributions	$  110,802	$    62,343	$  173,145
Distributions	(84)	(7,992)	(8,076)
Net loss	(4,917)	(7,752)	(12,669)
Members’ Capital, December 31, 2006	$  105,801	$    46,599	$  152,400
Distributions	(51)	(4,821)	(4,872)
Net loss	(6,222)	(29,956)	(36,178)
Members’ Capital, December 31, 2007	$    99,528	$    11,822	$  111,350
Distributions	(32)	(3,214)	(3,246)
Net loss	(25,374)	(13,368)	(38,742)
Members’ Capital, December 31, 2008	$    74,122	$   (4,760)	$    69,362

The accompanying notes are an integral part of these consolidated financial statements.

4

MACK-GREEN-GALE LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollar amounts in thousands)

	Year ended December 31,		Period from May 9, 2006 through December 31,
	2008	2007	2006
Cash Flows from Operating Activities:
Net Loss	$ (38,742)	$ (36,178)	$ (12,669)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	20,433	24,751	21,129
Amortization of deferred loan cost	264	1,437	725
Amortization of acquired above and below market lease intangibles	(2,181)	(2,651)	(2,124)
Minority interest in loss	(1,357)	(1,289)	(451)
Impairment charge	32,294	---	---
Gain on sale of investment in joint venture	---	(1,054)	---
Loss (gain) on sale of real estate	---	22,318	(437)
Restricted cash	(1,791)	4,501	(13,642)
Accounts receivable, net	193	(142)	(418)
Unbilled rents receivable	(1,319)	(4,252)	(4,128)
Deferred lease costs	(4,029)	(645)	(3,164)
Other assets	187	661	(2,002)
Accounts payable and accrued expenses	332	(4,752)	9,494
Tenant security deposits	112	69	609
Prepaid rent	(346)	(374)	2,421
Due to affiliates	(398)	---	3,727
Net cash provided by (used in) operating activities	3,652	2,400	(930)
Cash Flows (Used In) Provided by Investing Activities:
Net proceeds from sale of real estate	---	81,864	559
Net proceeds from sale of investment in joint venture	---	9,787	---
Investment in joint venture	---	446	(9,180)
Return of purchase price	358	459	334
Additions to real estate and intangible assets	(4,256)	(4,022)	(515,127)
Net cash (used in) provided by investing activities	(3,898)	88,534	(523,414)
Cash Flows (Used In) Provided by Financing Activities:
Increase in deferred financing costs	---	---	(3,344)
Contributions from members	---	---	173,145
Contributions from minority interest	---	---	6,128
Mortgage notes payable	---	3,275	527,000
Principal repayments on mortgage notes payable	(4,994)	(84,892)	(163,637)
Distributions to members	(3,246)	(4,872)	(8,076)
Distributions to minority interest	(114)	(171)	(287)
Redemptions	(10)	(55)	(10)
Net cash (used in) provided by financing activities	(8,364)	(86,715)	530,919
Net change in cash and cash equivalents	(8,610)	4,219	6,575
Cash and cash equivalents, beginning of period	10,794	6,575	---
Cash and cash equivalents, end of period	$      2,184	$    10,794	$     6,575
Supplemental Disclosure of Cash Flow Information: Cash paid during the period for interest	$    17,306	$    25,635	$   14,930

The accompanying notes are an integral part of these consolidated financial statements.

5

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollar amounts in thousands)

1.   ORGANIZATION AND RELATED MATTERS

Mack-Green-Gale LLC, together with its subsidiaries, (the “Company”), a Delaware limited liability company, was established as a joint venture between Mack-Cali Ventures L.L.C. (the “CLI Member”) and Gale SLG NJ LLC (the “Gale/SLG Member”) to acquire 100% of the membership interests in Gale SLG NJ GP LLC, a Delaware limited liability company and the 0.9600% general and 95.6025% limited partnership interests in the Gale SLG NJ Operating Partnership, L.P.

a.      Significant Transactions

On December 18, 2007, eight properties located in Troy, Michigan were sold for $83,500.  Third-party debt allocated to the properties in the amount of $78,886 was repaid and a net loss of $21,559 (net of $759 in minority interest) was recognized on the sale.

On July 16, 2007, the membership interest in Transwestern SL Gale Naperville, LLC, a joint venture, was sold for $9,956 and the note payable of $5,350 was repaid.  A net gain of $1,054 was recognized on the sale.

On August 3, 2006, a parcel of land located at 5600 New King Street in Troy, Michigan was sold for $559 and a net gain of $422 (net of $15 in minority interest) was recognized on the sale.

b.      Other Matters

At December 31, 2008, a summary of the real estate by regional market/park where the Company’s assets are located are as follows:

	Aggregate Square Feet	Number of Properties
	(Unaudited)	(Unaudited)
New Jersey:
Lyndhurst	242,517	2
Parsippany	456,514	3
Roseland	862,972	6
Bridgewater	198,376	1
Princeton	293,761	3
Warren	120,528	1
Branchburg	63,213	1
Total	2,237,881	17

6

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollar amounts in thousands)

2.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a.   Principles of Consolidation

The accompanying consolidated financial statements include the consolidated accounts of the Company.  All significant inter-company accounts and transactions have been eliminated.

b.   Reclassifications

Certain prior year balances have been reclassified in order to conform to the current year presentation.

c.   Use of Estimates

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes.  Actual results could differ from those estimates.

d.   Cash Equivalents

Cash equivalents consist of short-term, highly liquid investments, which are readily convertible into cash, and have original maturity dates of three months or less at the time of purchase.

e.   Accounts Receivable

The Company periodically performs a detailed review of amounts due from tenants and clients to determine if accounts receivable balances are impaired based on factors affecting the collectibility of those balances.  The Company’s estimate of the allowance for doubtful accounts requires the Company to exercise significant judgment about the timing, frequency and severity of collection losses, which affects the allowance and net income.

f.   Restricted Cash

Restricted cash is comprised of tenant security deposits and escrow and reserve funds for debt service, real estate taxes, property insurance, operating expenses, capital improvements, tenant improvements and leasing costs, established pursuant to certain mortgage financing arrangements and is comprised of the following:

	December 31,
	2008	2007
Security deposits	$       866	$     741
Escrow and other reserve funds	10,066	8,400
	$  10,932	$  9,141

7

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollar amounts in thousands)

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

g.   Rental Properties and Intangible Assets

The Company assesses the fair value of acquired assets (including land, buildings and improvements, and identified intangibles such as above and below market leases and acquired in-place leases) and acquired liabilities in accordance with SFAS No. 141: Business Combinations and allocates the purchase price based on these assessments.  The Company assesses fair value based on estimated cash flow projections that utilize appropriate discount and capitalization rates and available market information.  Estimates of future cash flows are based on a number of factors including the historical operating results, known trends, and market/economic conditions that may affect the property.

The cost of maintenance and repairs is charged to expense as incurred. Depreciation is computed on a straight-line basis over the estimated useful lives of the assets as follows:

Buildings and improvements	40 years
Land improvements	15 years
Tenant improvements	Lesser of lease term or estimated useful life
Furniture, fixtures and equipment	5-7 years

Above and below market lease values for acquired properties are recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to each in place lease and (ii) management’s estimate of the fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease.  The capitalized above and below market lease values are amortized as a reduction or addition to base rental revenue over the remaining term of the respective leases.

Other intangible assets acquired include amounts for the in-place lease values which are based on management’s evaluation of the specific characteristics of each tenant’s lease. Factors considered by management in its analysis of in-place lease values include an estimate of carrying costs during the hypothetical expected time it would take management to find a tenant to lease the space for the existing lease term (a “lease-up period”) considering current market conditions, and costs to execute similar leases.  Management estimates carrying costs, including such factors as real estate taxes, insurance and other operating expenses during the expected lease-up period, considering current market conditions.  In estimating costs to execute similar leases, management considers leasing commissions, legal and other related expenses.  The value of in-place leases is amortized to expense over the remaining initial terms of the respective leases.

8

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollar amounts in thousands)

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

g.      Rental Properties and Intangible Assets (continued)

The Company reviews real estate and the related intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of assets to be held and used may not be recoverable. In performing the review for recoverability of carrying value of property held for use, estimates are made of the future undiscounted cash flows from each of the properties during the period the property will be held and upon its eventual disposition.  If the expected future undiscounted cash flows are less than the carrying value of such property, an impairment charge is recognized resulting in a write-down of the carrying value of the property to an amount based on its fair value.

Property held for sale is reported at the lower of its carrying amount or its estimated fair value less costs to sell.  Once property is held for sale, depreciation expense is no longer recorded.  The operations of the property held for sale or property which has been sold are reported in discontinued operations in the accompanying consolidated statements of operations and assets and liabilities attributable to property held for sale are classified separately in the consolidated balance sheets for all periods presented.

For property to be disposed of, an impairment charge is recognized when the fair value of the property, less the estimated costs to sell, is less than the carrying amount of the property measured at the time the Company makes a commitment to sell the property.

h.      Other Assets

Deferred lease costs consist of commissions paid on leases, inducements paid to tenants and other costs directly attributable to acquiring and effectuating lease agreements, all of which are capitalized and amortized using the straight-line method over the lives of the related lease terms.

Deferred financing costs consist of fees and costs incurred to obtain financing and are amortized over the terms of the respective agreement. Unamortized deferred financing costs are expensed when the associated debt is retired prior to maturity.

i.      Revenue and Profit Recognition

Rental revenue is recognized on a straight-line basis over the non-cancelable term of the lease. The excess of rents so recognized over amounts contractually due pursuant to the underlying leases is included in other assets on the accompanying consolidated balance sheets.

Sales of real estate assets are recognized at closing subject to the receipt of adequate down payment and the meeting of other requirements in accordance with applicable accounting guidelines.

Gains and losses recognized on sales of real estate in which the Company has no continuing involvement are classified as discontinued operations in the consolidated statements of operations.

9

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollar amounts in thousands)

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

j.      Income Taxes

The Company is organized as limited partnerships and limited liability companies and, accordingly, no provision is made for federal or state income taxes, since income or loss of the Company must be reported by the respective Members on their individual tax returns.

The tax reporting entity’s tax return is subject to examination by federal and state taxing authorities.  Because many types of transactions are susceptible to varying interpretations under federal and state income tax laws and regulations, the amounts reported in the accompanying consolidated financials statements may be subject to change at a later date upon final determination by the respective taxing authorities.

In July 2006, the FASB issued FIN 48, ”Accounting for Uncertainty in Income Taxes” - an interpretation of FASB Statement No. 109, “Accounting for Income Taxes”.  This interpretation addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements.  Under FIN 48, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position.  The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement.  FIN 48 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures.

The adoption of FIN 48 did not have an impact on the Company’s consolidated financial statements.

k.      Concentration of Tenant and Credit Risk

Management of the Company performs ongoing evaluations of its tenants and requires certain tenants to provide security deposits.  Credit risk is dependent on the economic conditions in the respective markets and the financial condition of the tenant.

The Company maintains its cash and cash equivalents in financial institutions.  The combined balances at each institution periodically exceed FDIC insurance coverage limits.  The Company believes the risk is not significant.

10

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollar amounts in thousands)

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

l.      Advertising and Marketing Costs

Advertising and marketing costs were $160, $95 and $53 for the years ended December 31, 2008, 2007 and the period from May 9, 2006 (commencement of operations) through December 31, 2006, respectively, and are included in selling, general and administrative expense.  These costs are expensed as incurred.

m.      Minority Interest

Minority interest represents investors’ interests of 3.4% at December 31, 2008 and 2007 which, under certain conditions, are redeemable for cash at a redemption price determined by using a formula which is tied to the trading prices of shares of common stock of four leading Real Estate Investment Trusts specializing in the ownership and management of office properties.  The amount the Company would be required to pay to redeem the interests at December 31, 2008 and 2007 is $1,958 and $3,331, respectively.

3.      IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS

Fair Value Measurements – SFAS 157 & The Fair Value Option for Financial Assets and Financial Liabilities – SFAS 159

Effective January 1, 2008, the Company adopted Statement of Financial Accounting Standards (SFAS) No. 157, “Fair Value Measurements” (SFAS 157) and SFAS No. 159 “The Fair Value Option for Financial Assets and Financial Liabilities” (SFAS 159).  SFAS 157 defines fair value, establishes a framework for measuring fair value under accounting principles generally accepted in the United States (GAAP) and enhances disclosures about fair value measurements.  Fair value is defined under SFAS 157 as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.  SFAS 159 allows an entity the irrevocable option to elect fair value for the initial and subsequent measurement for certain financial assets and liabilities on a contract-by-contract basis.  The impact of adopting both SFAS 157 and SFAS 159 was immaterial to the Company.

In February 2008, the FASB deferred the effective date of SFAS 157 for one-year for non-financial assets and non-financial liabilities that are recognized or disclosed at fair value on a nonrecurring basis.  SFAS 157 is now effective for those assets and liabilities for years beginning after November 15, 2008.

11

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollar amounts in thousands)

3.      IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS (Continued)

FASB Statement No. 160 (“FASB No. 160”),Non-controlling Interests in Consolidated Financial Statements – an Amendment of ARB No. 51

In December 2007, the FASB issued No. 160, which establishes and expands accounting and reporting standards for minority interests, which will be re-characterized as non-controlling interests, in a subsidiary and the deconsolidation of a subsidiary.  This statement is effective for fiscal years beginning on or after December 15, 2008.  The Company is currently assessing the potential impact that the adoption of FASB No. 160 will have on its financial position and results of operations.

4.      FAIR VALUE OF FINANCIAL INSTRUMENTS

The techniques used to value financial instruments where quoted market prices are not available are significantly affected by the assumptions used, including the discount rates and the estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate settlement of the instrument.

The methods and assumptions used to estimate the fair value of financial instruments are as follows:

a.    The carrying value of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued expenses, and tenant security deposits, approximates their fair value due to the short maturities of these items.

b.   At December 31, 2008, the fair values of mortgage notes payable are estimated as the value of the discounted cash flow required to service the loan.  The rate used to discount the cash flow is based upon the yield as of December 31, 2008 for a U.S. Treasury with a similar maturity date as the loan, adjusted for risk factors.  The $186,465 carrying value of fixed rate mortgage notes payable have an approximate fair value of $140,405 at December 31, 2008.  At December 31, 2008, fair values of variable rate mortgage notes payable approximate their carrying values because such mortgages re-price frequently.

12

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 (Dollar amounts in thousands)

5.      INVESTMENT IN REAL ESTATE

a.      Investment in real estate consists of the following:

	December 31,
	2008	2007
Land	$    53,917	$    61,864
Building and improvements	307,327	327,776
	361,244	389,640
Accumulated depreciation	(34,332)	(21,612)
	$  326,912	$  368,028

b.      Discontinued operations

There were no discontinued operations during the year ended December 31, 2008.

For the year ended December 31, 2007, revenue and net loss attributable to discontinued operations which were operations from properties sold in 2007 were $15,976 and $3,261 (net of $115 in minority interest), respectively which include interest expense attributable to the mortgage notes payable secured by the sold properties in the amount of $5,488.

For the period from May 9, 2006 (commencement of operations) through December 31, 2006, revenue and net loss attributable to discontinued operations which were operations from properties sold in 2007 were $10,928 and $4,775 (net of $168 in minority interest), respectively which include interest expense attributable to the mortgage notes payable secured by the sold properties in the amount of $3,590.

6.      OTHER ASSETS

Other assets are comprised of the following:

	December 31,
	2008	2007
Deferred financing costs	$    1,733	$    1,733
Deferred lease costs	7,024	2,995
Unbilled rents receivable	7,902	6,583
Prepaid other	737	924
	17,396	12,235
Accumulated amortization	(2,429)	(1,484)
	$  14,967	$  10,751

13

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollar amounts in thousands)

7.      ACQUIRED FAVORABLE AND UNFAVORABLE LEASE INTANGIBLES

In accordance with SFAS No. 141: Business Combinations, intangible lease costs and in-place lease obligations are comprised of the following:

	December 31,
	2008	2007
Above market lease value	$    2,520	$    2,520
In-place lease value	33,298	34,496
	35,818	37,016
Accumulated amortization	(18,877)	(12,582)
	$  16,941	$  24,434

The acquired unfavorable lease intangibles are $12,912 and $15,554, net of $7,057 and $4,415 in accumulated amortization, at December 31, 2008 and 2007, respectively. The net amortization of the acquired above and below market lease intangibles of $2,181, $2,651 and $2,124 for the years ended December 31, 2008, 2007 and the period from May 9, 2006 (commencement of operations) through December 31, 2006, respectively, is reflected as an increase to rental revenue in the accompanying consolidated statements of operations.

The estimated annual amortization of acquired below market value leases net of acquired above market value leases for each of the succeeding five years and thereafter is as follows:

2009	$    1,895
2010	1,706
2011	1,744
2012	1,778
2013	1,609
Thereafter	3,084
	$  11,816

Amortization of acquired in-place lease value of $7,032, $8,687 and $9,003 for the years ended December 31, 2008, 2007 and the period from May 9, 2006 (commencement of operations) through December 31, 2006, respectively, is included in depreciation and amortization in the accompanying consolidated statements of operations. The estimated annual amortization of acquired in-place lease value for each of the succeeding five years and thereafter is as follows:

2009	$    6,137
2010	4,508
2011	2,597
2012	1,894
2013	592
Thereafter	117
	$  15,845

14

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollar amounts in thousands)

8.      MORTGAGE NOTES PAYABLE

Mortgage notes payable at December 31, 2008 and 2007 consisted of the following:

	December 31,
Lender	2008	2007	Interest Rate	Maturity
I.  Wachovia Bank, N.A.
2014 Loans	$  107,691	$  109,261	6.26%	August 11, 2014
2016 Loans	78,774	78,923	6.27%	May 11, 2016
II. Gramercy Warehouse Funding I LLC	90,287	90,287	LIBOR + 2.75%*	May 9, 2009
III. Mack-Cali Realty, L.P.	---	3,275	LIBOR + 4.00%*	January 17, 2009
	$   276,752	$  281,746

* London Interbank Offered Rate (LIBOR) at December 31, 2008 was 0.44%.

I.   The fixed rate loans require monthly payments of principal and interest, and tax, insurance and replacement escrows.  The loans may be prepaid subject to usual and customary yield maintenance provisions, and are secured by ten properties located in New Jersey.

II.   The cross-collateralized, cross-defaulted, interest-only loan is secured by six properties and a pledge of distributions from excess cash flows on another property.  The loan has two remaining one-year extension options subject to satisfying the following conditions: (i) the Debt Service Coverage Ratio as of the payment date which is immediately prior to the effective maturity date (i.e. without giving effect to such extension) is 1.10 to 1.00 or greater, and (ii) a rate cap agreement with a term of not less than one year.  Extension and pay-off of this loan is subject to a 25 basis point exit fee.

III.   Secured by one property, this interest-only loan had a maximum borrowing capacity of $7,000.

The Company’s real estate and related leases collateralized the mortgage notes payable noted above.

15

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollar amounts in thousands)

8.      MORTGAGE NOTES PAYABLE (Continued)

The aggregate principal payments and maturities of mortgage notes payable for each of the next five years and thereafter at December 31, 2008 are as follows:

2009	$    92,215
2010	2,055
2011	2,541
2012	2,952
2013	3,177
Thereafter	173,812
	$  276,752

9.      BASE RENTS

The Company, as lessor, leases commercial space under operating leases. Leased properties include both single and multi-tenant facilities. The future minimum rental receipts due on non-cancelable operating leases for the next five years and thereafter at December 31, 2008 are as follows:

2009	$    44,571
2010	42,342
2011	38,695
2012	36,211
2013	32,294
Thereafter	89,781
	$  283,894

Substantially all of these lease agreements contain provisions which provide for the reimbursement of real estate taxes and operating expenses over the base year amounts and rental increases tied to increases in, among other factors, the consumer price index.

In 2006, the Company received $2,000 from one tenant for early termination of their lease.  This amount is included in other income.

16

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollar amounts in thousands)

10.         RELATED PARTY TRANSACTIONS

The Company, which does not employ any personnel, designated The Gale Management Company, L.L.C. (a subsidiary of Mack-Cali Realty, L.P.) and/or its affiliates (“Gale”) to be the administrator of the Company pursuant to a one-year Management Agreement (the “Management Agreement”) which is automatically renewable for successive one year periods.  Under the Management Agreement, Gale provides the Company’s property management, construction, leasing, accounting and other services as needed.

The Company incurred $8,712, $8,515 and $5,476 for management fees, leasing fees, tenant improvements, other operating costs and direct expenses relating to building operations, and improvements made to the properties for the years ended December 31, 2008, 2007 and the period from May 9, 2006 (commencement of operations) through December 31, 2006, respectively.  Included in accounts payable and accrued expenses in the accompanying consolidated balance sheets, are amounts due to Gale at December 31, 2008 and 2007 aggregating $520 and $523, respectively, attributable to the above-referenced costs.

Included in accounts payable and accrued expenses at December 31, 2008 and 2007 is $2,318 and $2,939, respectively, due to the members.  This amount does not bear interest and is expected to be repaid in the normal course of business.

The Company paid interest expense of $5,308, $7,377 and $4,309 to Gramercy Warehouse Funding I LLC, an affiliate of SL Green Realty Corp, Inc., a related party, and $61, $216 and $0 to Mack-Cali Realty, L.P., a related party, for the years ended December 31, 2008, 2007 and the period from May 9, 2006 (commencement of operations) through December 31, 2006, respectively (see Note 8).

11.         COMMITMENTS AND CONTINGENCIES

The Company, as an owner of real estate, is subject to various environmental laws of federal and local governments.  Compliance by the Company with existing laws has not had a material adverse effect on the Company’s financial condition and results of operations, and management does not believe it will have such an impact in the future. However, the Company cannot predict the impact of new or changed laws or regulations on its current properties or on its properties that it may acquire in the future.

The Company is not aware of any litigation threatened against the Company other than routine litigation arising out of the normal course of business, some of which is expected to be covered by insurance, none of which is expected to have a material adverse effect on the Company’s financial condition.

17

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollar amounts in thousands)

11.         COMMITMENTS AND CONTINGENCIES (Continued)

The Company has entered into certain commitments to tenants regarding improvements and fix-up allowances.  The estimated potential commitment as of December 31, 2008 total $6,232.

12.         IMPAIRMENT CHARGE

Due to the downturn in the economy and, in particular, the Company’s anticipated holding period pertaining to six properties encumbered under the Gramercy Warehouse Funding I LLC loan that matures on May 9, 2009 (see Note 8), management believes that this is an indicator that these properties’ carrying amounts may not be recoverable at December 31, 2008.  In accordance with Statement of Financial Accounting Standards No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”, the Company prepared an analysis to estimate the sum of the undiscounted cash flows expected to result from the use and eventual disposition of these properties.  Management determined that the estimate of the aggregate future cash flows to be generated by these properties are less than the book values of the total net rental properties.  The book values of the total net rental properties exceed its fair values by approximately $32,294, and the Company has recorded this amount on their consolidated financial statements as an impairment charge for the year ended December 31, 2008.  Fair values were estimated by using a discounted cash flow technique, which considered the cash flows expected to result from the use and eventual disposition of the properties discounted at an appropriate rate.

18

EX-99.2

MACK-GREEN-GALE LLC AND SUBSIDIARIES

UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

AS OF APRIL 28, 2009 AND

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

MACK-GREEN-GALE LLC AND SUBSIDIARIES

UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

AS OF APRIL 28, 2009 AND

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

TABLE OF CONTENTS

	Page No.
Unaudited Consolidated Balance Sheet	1
Unaudited Consolidated Statement of Operations	2
Unaudited Consolidated Statement of Changes in Members’ Capital	3
Unaudited Consolidated Statement of Cash Flows	4
Notes to Unaudited Consolidated Financial Statements	5 – 16

MACK-GREEN-GALE LLC AND SUBSIDIARIES

UNAUDITED CONSOLIDATED BALANCE SHEET

AS OF APRIL 28, 2009

 (Dollar amounts in thousands)

ASSETS
Investment in real estate, net of accumulated depreciation of $38,482	$   323,799
Cash and cash equivalents	3,912
Restricted cash	10,227
Accounts receivable, net of allowance for doubtful accounts of $514	238
Other assets, net of accumulated amortization of $2,705	16,641
Acquired favorable lease intangibles, net of accumulated amortization of $21,126	14,660
	$   369,477
LIABILITIES AND MEMBERS’ CAPITAL
Liabilities
Mortgage notes payable	$   276,108
Accounts payable and accrued expenses	7,973
Tenant security deposits	746
Prepaid rent	1,800
Acquired unfavorable lease intangibles, net of accumulated amortization of $7,959	12,010
	298,637
Redeemable Noncontrolling interest	2,348
Commitments and Contingencies
Members’ Capital	68,492
	$   369,477

The accompanying notes are an integral part of this unaudited consolidated financial statement.

1

MACK-GREEN-GALE LLC AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

 (Dollar amounts in thousands)

Revenues:
Base Rents	$    15,941
Escalations and other tenant recoveries	1,000
Other income	641
	17,582
Expenses:
Real estate taxes	1,772
Other operating expenses	5,015
Interest	4,883
Depreciation and amortization	6,493
Selling, general and administrative	319
	18,482
Net Loss Before Noncontrolling Interest	(900)
Loss Attributable to Noncontrolling interest	30
Net Loss	$       (870)

The accompanying notes are an integral part of this unaudited consolidated financial statement.

2

MACK-GREEN-GALE LLC AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENT OF CHANGES

IN MEMBERS’ CAPITAL

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

(Dollar amounts in thousands)

	Mack-Cali Ventures L.L.C.	Gale SLG NJ LLC	Total
Members’ Capital, January 1, 2009	$    74,122	$    (4,760)	$  69,362
Net loss	(758)	(112)	(870)
Members’ Capital, April 28, 2009	$    73,364	$   (4,872)	$    68,492

The accompanying notes are an integral part of this unaudited consolidated financial statement.

3

MACK-GREEN-GALE LLC AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

 (Dollar amounts in thousands)

Cash Flows from Operating Activities:
Net Loss	$ (870)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	6,493
Amortization of deferred loan cost	20
Amortization of acquired above and below market lease intangibles	(708)
Loss Attributable to Noncontrolling interest in loss	(30)
Restricted cash	705
Accounts receivable, net	129
Deferred rents receivable	(233)
Deferred lease costs	(879)
Other assets	(838)
Accounts payable and accrued expenses	(32)
Tenant security deposits	(42)
Prepaid rent	99
Other liabilities	(399)
Net cash provided by operating activities	3,415
Cash Flows Used In Investing Activities:
Additions to real estate and intangible assets	(1,037)
Net cash used in investing activities	(1,037)
Cash Flows Used In Financing Activities:
Principal repayments on mortgage notes payable	(644)
Redemptions	(6)
Net cash used in financing activities	(650)
Net change in cash and cash equivalents	1,728
Cash and cash equivalents, beginning of period	2,184
Cash and cash equivalents, end of period	$ 3,912
Supplemental Disclosure of Cash Flow Information: Cash paid during the period for interest	$ 4,950

The accompanying notes are an integral part of this unaudited consolidated financial statement.

4

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

(Dollar amounts in thousands)

1.   ORGANIZATION AND RELATED MATTERS

Mack-Green-Gale LLC, together with its subsidiaries, (the “Company”), a Delaware limited liability company, was established as a joint venture between Mack-Cali Ventures L.L.C. (the “CLI Member”) and Gale SLG NJ LLC (the “Gale/SLG Member”) to acquire 100% of the membership interests in Gale SLG NJ GP LLC, a Delaware limited liability company and the 0.9600% general and 95.6025% limited partnership interests in the Gale SLG NJ Operating Partnership, L.P.

On April 29, 2009, the CLI Member acquired Gale/SLG Member’s interests in the Company.  As a result, the CLI Member owns 100 percent of the Company.  Concurrent with the transaction, the loan agreement with Gramercy Warehouse Funding I LLC on six office properties indirectly owned by the Company was restructured.  (See Note 8).

a.      Other Matters

As of April 28, 2009, a summary of the real estate by regional market/park where the Company’s assets are located are as follows:

	Aggregate Square Feet	Number of Properties
New Jersey:
Lyndhurst	242,517	2
Parsippany	456,514	3
Roseland	862,972	6
Bridgewater	198,376	1
Princeton	293,761	3
Warren	120,528	1
Branchburg	63,213	1
Total	2,237,881	17

2.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a.   Principles of Consolidation

The accompanying consolidated financial statements include the consolidated accounts of the Company.  All significant inter-company accounts and transactions have been eliminated.

5

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

(Dollar amounts in thousands)

2.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

b.   Basis of Presentation

The preparation of financial statements in conformity with generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

On July 1, 2009, the Financial Accounting Standards Board (“FASB”) issued the FASB Accounting Standards Codification (“ASC”) 105-10, General Accepted Accounting Principles, (“ASC 105-10”). ASC 105-10 establishes the FASB Accounting Standard Codification (“Codification”) as the single source of authoritative U.S. GAAP recognized by the FASB to be applied by nongovernmental entities. Following the Codification, the FASB will not issue new standards in the form of Statements, FASB Staff Positions or Emerging Issues Task Force Abstracts.  Instead, it will issue Accounting Standards Updates, which will serve to update the Codification, provide background information about the guidance and provide the basis for conclusions on the changes to the Codification.  GAAP was not intended to be changed as a result of the FASB’s Codification project, but it will change the way the guidance is organized and presented.  The Company has implemented the Codification in this report by providing references to the Codification topics, as appropriate.

c.   Cash Equivalents

Cash equivalents consist of short-term, highly liquid investments, which are readily convertible into cash, and have original maturity dates of three months or less at the time of purchase.

d.   Accounts Receivable

The Company periodically performs a detailed review of amounts due from tenants and clients to determine if accounts receivable balances are impaired based on factors affecting the collectibility of those balances.  The Company’s estimate of the allowance for doubtful accounts requires the Company to exercise significant judgment about the timing, frequency and severity of collection losses, which affects the allowance and net income.

e.   Restricted Cash

Restricted cash is comprised of tenant security deposits and escrow and reserve funds for debt service, real estate taxes, property insurance, operating expenses, capital improvements, tenant improvements and leasing costs, established pursuant to certain mortgage financing arrangements and is comprised of the following:

Security deposits	$       808
Escrow and other reserve funds	9,419
	$  10,227

6

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

(Dollar amounts in thousands)

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

f.   Rental Properties and Intangible Assets

The Company assesses the fair value of acquired assets (including land, buildings and improvements, and identified intangibles such as above and below market leases and acquired in-place leases) and acquired liabilities in accordance with ASC 805, Business Combinations, and allocates the purchase price based on these assessments.  The Company assesses fair value based on estimated cash flow projections that utilize appropriate discount and capitalization rates and available market information.  Estimates of future cash flows are based on a number of factors including the historical operating results, known trends, and market/economic conditions that may affect the property.

The cost of maintenance and repairs is charged to expense as incurred. Depreciation is computed on a straight-line basis over the estimated useful lives of the assets as follows:

Buildings and improvements	40 years
Land improvements	15 years
Tenant improvements	Lesser of lease term or estimated useful life
Furniture, fixtures and equipment	5-7 years

Above and below market lease values for acquired properties are recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to each in place lease and (ii) management’s estimate of the fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease.  The capitalized above and below market lease values are amortized as a reduction or addition to base rental revenue over the remaining term of the respective leases.

Other intangible assets acquired include amounts for the in-place lease values which are based on management’s evaluation of the specific characteristics of each tenant’s lease. Factors considered by management in its analysis of in-place lease values include an estimate of carrying costs during the hypothetical expected time it would take management to find a tenant to lease the space for the existing lease term (a “lease-up period”) considering current market conditions, and costs to execute similar leases.  Management estimates carrying costs, including such factors as real estate taxes, insurance and other operating expenses during the expected lease-up period, considering current market conditions.  In estimating costs to execute similar leases, management considers leasing commissions, legal and other related expenses.  The value of in-place leases is amortized to expense over the remaining initial terms of the respective leases.

7

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

(Dollar amounts in thousands)

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

f.      Rental Properties and Intangible Assets (continued)

The Company reviews real estate and the related intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of assets to be held and used may not be recoverable. In performing the review for recoverability of carrying value of property held for use, estimates are made of the future undiscounted cash flows from each of the properties during the period the property will be held and upon its eventual disposition.  If the expected future undiscounted cash flows are less than the carrying value of such property, an impairment charge is recognized resulting in a write-down of the carrying value of the property to an amount based on its fair value.

Property held for sale is reported at the lower of its carrying amount or its estimated fair value less costs to sell.  Once property is held for sale, depreciation expense is no longer recorded.  The operations of the property held for sale or property which has been sold are reported in discontinued operations in the accompanying consolidated statement of operations and assets and liabilities attributable to property held for sale are classified separately in the consolidated balance sheet.

For property to be disposed of, an impairment charge is recognized when the fair value of the property, less the estimated costs to sell, is less than the carrying amount of the property measured at the time the Company makes a commitment to sell the property.

g.      Other Assets

Deferred lease costs consist of commissions paid on leases, inducements paid to tenants and other costs directly attributable to acquiring and effectuating lease agreements, all of which are capitalized and amortized using the straight-line method over the lives of the related lease terms.

Deferred financing costs consist of fees and costs incurred to obtain financing and are amortized over the terms of the respective agreement. Unamortized deferred financing costs are expensed when the associated debt is retired prior to maturity.

h.      Revenue and Profit Recognition

Rental revenue is recognized on a straight-line basis over the non-cancelable term of the lease. The excess of rents so recognized over amounts contractually due pursuant to the underlying leases is included in other assets on the accompanying consolidated balance sheet.

Sales of real estate assets are recognized at closing subject to the receipt of adequate down payment and the meeting of other requirements in accordance with applicable accounting guidelines.

8

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

(Dollar amounts in thousands)

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

h.      Revenue and Profit Recognition (continued)

Gains and losses recognized on sales of real estate in which the Company has no continuing involvement are classified as discontinued operations in the consolidated statement of operations.

i.      Income Taxes

The Company is organized as limited partnerships and limited liability companies and, accordingly, no provision is made for federal or state income taxes, since income or loss of the Company must be reported by the respective Members on their individual tax returns.

The Company adopted the amended provisions related to uncertain tax provisions of ASC 740, Income Taxes, on January 1, 2007.  As a result of the implementation of the guidance, the Company recognized no material adjustments regarding its tax accounting treatment.  The Company expects to recognize interest and penalties related to uncertain tax positions, if any, as income tax expense, which is included in general and administrative expense.

In the normal course of business, the Company or one of its subsidiaries is subject to examination by federal, state and local jurisdictions in which it operates, where applicable.  As of April 28, 2009, the tax years that remain subject to examination by the major tax jurisdictions under the statute of limitations is from the year 2006 forward.

j.      Concentration of Tenant and Credit Risk

Management of the Company performs ongoing evaluations of its tenants and requires certain tenants to provide security deposits.  Credit risk is dependent on the economic conditions in the respective markets and the financial condition of the tenant.

The Company maintains its cash and cash equivalents in financial institutions.  The combined balances at each institution periodically exceed FDIC insurance coverage limits.  The Company believes the risk is not significant.

k.   Redeemable Noncontrolling Interest

Redeemable noncontrolling interest represents investors’ interests of 3.4% at April 28, 2009 which, under certain conditions, are redeemable for cash at a redemption price determined by using a formula which is tied to the trading prices of shares of common stock of four leading Real Estate Investment Trusts specializing in the ownership and management of office properties.  The amount the Company would be required to pay to redeem the interests at April 28, 2009 is $2,244.

9

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

(Dollar amounts in thousands)

3.IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS

Statement of Financial Accounting Standards No. 167, Amendments to FASB Interpretation No. 46(R) (“FASB No. 167”)

FASB No. 167 amends, among other items, for FIN 46 (R) to require an enterprise to perform an analysis to determine whether the enterprise’s variable interest or interests give it a controlling financial interest in a variable interest entity.  This analysis identifies the primary beneficiary of a variable interest entity as the enterprise that has both of the following characteristics:

a.   The power to direct the activities of a variable interest entity that most significantly impact the entity’s economic performance

b.   The obligation to absorb losses of the entity that could potentially be significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity.

Additionally, an enterprise is required to assess whether it has an implicit financial responsibility to ensure that a variable interest entity operates as designed when determining whether it has the power to direct the activities of the variable interest entity that most significantly impact the entity’s economic performance.

FASB No. 167 also amends FIN 46(R) to require ongoing reassessments of whether an enterprise is the primacy beneficiary of a variable interest entity.  Additionally, FASB No. 167 amends FIN 46(R) to eliminate the quantitative approach previously required for determining the primary beneficiary of a variable interest entity, which was based on determining which enterprise absorbs the majority of the entity’s expected losses, receives a majority of the entity’s expected residual returns, or both.  FASB No. 167 amends certain guidance in Interpretation 46(R) for determining whether an entity is a variable interest entity.  Also, FASB No. 167 amends FIN 46(R) to require enhanced disclosures that will provide users of financial statements with more transparent information about an enterprise’s involvement in a variable interest entity.  The enhanced disclosures are required for any enterprise that holds a variable interest in a variable interest entity.  As FASB No. 167 will be effective as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009 with earlier application prohibited, the Company is currently assessing the potential impact that the adoption of FASB No. 167 will have on its financial position and results of operation.

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MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

(Dollar amounts in thousands)

4.      FAIR VALUE OF FINANCIAL INSTRUMENTS

The techniques used to value financial instruments where quoted market prices are not available are significantly affected by the assumptions used, including the discount rates and the estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate settlement of the instrument.

The methods and assumptions used to estimate the fair value of financial instruments are as follows:

a.    The carrying value of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued expenses, and tenant security deposits, approximates their fair value due to the short maturities of these items.

b.   At April 28, 2009, the $276,108 carrying value of the mortgage notes payable have an approximate fair value of $232,607.

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MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

 (Dollar amounts in thousands)

5.      INVESTMENT IN REAL ESTATE

Investment in real estate consists of the following:

Land	$    53,917
Building and improvements	308,364
	362,281
Accumulated depreciation	(38,482)
	$  323,799

6.      OTHER ASSETS

Other assets are comprised of the following:

Deferred financing costs	$    1,733
Deferred lease costs	7,903
Unbilled rents receivable	8,135
Prepaid and other	1,575
	19,346
Accumulated amortization	(2,705)
	$  16,641

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MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

(Dollar amounts in thousands)

7.      ACQUIRED FAVORABLE AND UNFAVORABLE LEASE INTANGIBLES

In accordance with ASC 805, Business Combinations, intangible lease costs and in-place lease obligations are comprised of the following:

Above market lease value	$    2,520
In-place lease value	33,266
	35,786
Accumulated amortization	(21,126)
	$  14,660

The acquired unfavorable lease intangibles are $12,010, net of $7,959 in accumulated amortization, at April 28, 2009. The net amortization of the acquired above and below market lease intangibles of $708 for the period from January 1, 2009 through April 28, 2009, is reflected as an increase to rental revenue in the accompanying consolidated statement of operations.

The estimated annual amortization of acquired below market value leases net of acquired above market value leases for each of the succeeding five years and thereafter is as follows:

April 29, 2009 - December 31, 2009	$   1,187
2010	1,706
2011	1,745
2012	1,778
2013	1,609
2014	1,086
Thereafter	1,998
	$  11,109

Amortization of acquired in-place lease value of $2,087 for the period from January 1, 2009 through April 28, 2009, is included in depreciation and amortization in the accompanying consolidated statement of operations. The estimated annual amortization of acquired in-place lease value for each of the succeeding five years and thereafter is as follows:

April 29, 2009 - December 31, 2009	$    4,051
2010	4,508
2011	2,597
2012	1,894
2013	592
2014	117
Thereafter	--
	$  13,759

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MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

(Dollar amounts in thousands)

8.      MORTGAGE NOTES PAYABLE

Mortgage notes payable at April 28, 2009 consisted of the following:

Lender	Outstanding Balance	Interest Rate	Maturity
I.  Wachovia Bank, N.A.
2014 Loans	$  107,127	6.26%	August 11, 2014
2016 Loans	78,694	6.27%	May 11, 2016
II. Gramercy Warehouse Funding I LLC	90,287	LIBOR + 2.75%*	May 9, 2009
	$  276,108

* London Interbank Offered Rate (LIBOR) at April 28, 2009 was 0.56%.

I.   The fixed rate loans require monthly payments of principal and interest, and tax, insurance and replacement escrows.  The loans may be prepaid subject to usual and customary yield maintenance provisions, and are secured by ten properties located in New Jersey.

II.   The cross-collateralized, cross-defaulted, interest-only loan is secured by six properties (the “Portfolio Properties”).  Subsequent to April 28, 2009, the mortgage loans were modified to provide for, among other things, interest to accrue at the current rate of LIBOR plus 275 basis point per annum, with the interest pay rate capped at 3.15 percent per annum.  Under the Agreement, the payment of debt service is subordinate to the payment of operating expenses.  Interest at the pay rate is payable only out of funds generated by the Portfolio Properties and only to the extent that the Portfolio Properties’ operating expenses have been paid, with any accrued unpaid interest above the pay rate serving to increase the balance of the amounts due at the termination of the agreement.  Any excess funds after payment of debt service generally will be escrowed and available for future capital and leasing costs, as well as to cover future cash flow shortfalls, as appropriate.  The Agreement terminates on May 9, 2011.  Approximately six months in advance of the end of the term of the Agreement, the entities that own the Portfolio Properties (the “Portfolio Entities”) are to provide estimates of each property’s fair market value (“FMV”).  Gramercy has the right to accept or reject the FMV.  If Gramercy rejects the FMV, Gramercy must market the property for sale in cooperation with the Portfolio Entities and must approve the ultimate sale.  However, Gramercy has no obligation to market a Portfolio Property if the FMV is less than the allocated amount due, including accrued, unpaid interest.  If any Portfolio Property is not sold, the Portfolio Entities have agreed to give a deed in lieu of foreclosure, unless the FMV was equal to or greater than the allocated amount due for such Portfolio Property, in which case they can elect to have that Portfolio Property released by paying the FMV.  If Gramercy accepts the FMV, the Portfolio Property will be released from the Gramercy Agreement upon payment of the FMV.

The Company’s real estate and related leases collateralized the mortgage notes payable noted above.

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MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

(Dollar amounts in thousands)

8.      MORTGAGE NOTES PAYABLE (Continued)

The aggregate principal payments and maturities of mortgage notes payable for each of the next five years and thereafter at April 28, 2009 are as follows:

April 29, 2009 - December 31, 2009	$      1,284
2010	2,055
2011	92,828
2012	2,952
2013	3,177
2014	99,136
Thereafter	74,676
	$  276,108

9.      BASE RENTS

The Company, as lessor, leases commercial space under operating leases. Leased properties include both single and multi-tenant facilities. The future minimum rental receipts due on non-cancelable operating leases for the next five years and thereafter at April 28, 2009 are as follows:

April 29, 2009 - December 31, 2009	$    27,697
2010	41,596
2011	39,583
2012	37,569
2013	33,685
2014	27,863
Thereafter	75,639
	$  283,632

Substantially all of these lease agreements contain provisions which provide for the reimbursement of real estate taxes and operating expenses over the base year amounts and rental increases tied to increases in, among other factors, the consumer price index.

15

MACK-GREEN-GALE LLC AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD JANUARY 1, 2009 THROUGH APRIL 28, 2009

(Dollar amounts in thousands)

10.         RELATED PARTY TRANSACTIONS

The Company, which does not employ any personnel, designated The Gale Management Company, L.L.C. (a subsidiary of Mack-Cali Realty, L.P.) and/or its affiliates (“Gale”) to be the administrator of the Company pursuant to a one-year Management Agreement (the “Management Agreement”) which is automatically renewable for successive one year periods.  Under the Management Agreement, Gale provides the Company’s property management, construction, leasing, accounting and other services as needed.

The Company incurred $2,679 for management fees, leasing fees, tenant improvements, other operating costs and direct expenses relating to building operations, and improvements made to the properties for the period from January 1, 2009 through April 28, 2009.  Included in accounts payable and accrued expenses in the accompanying consolidated balance sheet, are amounts due to Gale at April 28, 2009 aggregating $368 attributable to the above-referenced costs.

Included in accounts payable and accrued expenses at April 28, 2009, is $1,919 due to the members.  This amount does not bear interest and is expected to be repaid in the normal course of business.

The Company paid interest expense of $1,029 to a related party, Gramercy Warehouse Funding I LLC, an affiliate of SL Green Realty Corp, Inc. for the period from January 1, 2009 through April 28, 2009.

11.         COMMITMENTS AND CONTINGENCIES

The Company, as an owner of real estate, is subject to various environmental laws of federal and local governments.  Compliance by the Company with existing laws has not had a material adverse effect on the Company’s financial condition and results of operations, and management does not believe it will have such an impact in the future. However, the Company cannot predict the impact of new or changed laws or regulations on its current properties or on its properties that it may acquire in the future.

The Company is not aware of any litigation threatened against the Company other than routine litigation arising out of the normal course of business, some of which is expected to be covered by insurance, none of which is expected to have a material adverse effect on the Company’s financial condition.

The Company has entered into certain commitments to tenants regarding improvements and fix-up allowances.  The estimated potential commitment as of April 28, 2009 total $4,628.

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