Hersh handshake seals New Jersey mega-deal.

In a world of conference calls and electronic transactions, business dealings these days seem to have reached new heights of impersonality. It's executives like Mitchell Hersh, president and CEO of Mack-Cali, who are showing just how effective and integral to success traditions of the old school can be.

When Mack-Cali, a leading owner and operator of class A office space and commercial property in New Jersey, partnered with the Mills Corporation to develop the upcoming Meadowlands Xanadu--a 4.76 million s/f multi-use attraction with family entertainment, office, and hotel components--all that was needed to seal the partnership between the two sizable corporations was a handshake between its presidents.

According to Hersh, such gestures, along with the strength of one's word, means more to him than a ream of legal and contractual documents

"We both had a lot of respect for one another," said Hersh of Mills CEO Kenneth Parent. "When we shook hands I knew the deal was done. There's too few of these kinds of transactions in business today. There are fewer faces today, things are different than they were."

Hersh described a similar level of trust in a recent and very profitable deal with AT&T, in which Mack-Cali repurchased Kemble Plaza II, an office building in Morris Township, for $34 million--a property the firm had originally sold to AT&T in 2000 for $80 million.

"With AT&T, we had a long track record," Hersh said. "We've been working together for 25 years. We know we can trust each other's word and that's what makes these kinds of deals possible. Even when you're dealing with big blue chip companies, if they think you're being fair and not looking for an edge, they reciprocate."

If Hersh has a penchant for taking advantage of excellent value and securing the best possible ratio between risk and reward, Meadowlands Xanadu is his magnum opus. For the relatively paltry investment of $32.5 million, Mack-Cali will have a 20% stake in the sports/retail/entertainment side of the development, which, judging by its sheer inventiveness and grandeur, is sure to be a profitable endeavor.

Meadowlands Xanadu, which will surround the Continental Airlines Arena, will include an indoor skiing facility, indoor wave surfing, fishing, rock and ice climbing, extreme wheel sports (bike, blade, and board), children's educational venues like Kid City and Crayola Works, a grand 31 screen movie palace, an ESPN Zone, miniature NASCAR indoor racing, a luxury spa, and fine restaurants. The outdoor components will include the Bergen Cliff Hawks minor league baseball park.

"It's very exciting, it's energizing," Hersh said of the development. "And I think it's clearly an opportunity to broaden our sector. Obviously we focus on office ownership, development, management and tenant relations. But occasionally we take advantage of opportunities to broaden some of our activities.

"The Meadowlands will now be a destination location. With the various theme oriented venue type activities combined with retail activity, we're creating a destination. We're getting involved at a very early stage, so for us it's a marvelous opportunity."

Mack-Cali's 20% stake in the entertainment side of the venue is contingent upon its assumption of 80% of the development costs for a hotel and office space--planned as a future part of the compound. Mack-Cali's expertise in this area, demonstrated most recently by its magnificent Harborside Financial Center development in Jersey City, made the firm the obvious choice for Mills.

And although it was old school type deal making which sealed the partnership between the two, the spoils of modern technology was what helped give them a winning state bid.

"We were able to present 3D models of the entire structure and give them the sense of actually being there," Hersh said. "There's a lot of creativity that's gone into this. When the stakeholders, the mayors and legislators in the surrounding communities of the Meadowlands, and several state officials--all the decision makers in this process--saw the presentation, it was hard not to become enthused. The idea just bowled them over and it really came alive the way we presented it."