Hirschman brokers $11.2 million sale.

In one of the more unique real estate transactions of the year, David Hirschman Realty Co. brokered the sale of Century Plaza, located at 15 Essex Road, Paramus, NJ, by Cali Realty Corporation to The Valley Hospital. David L, Steiger, David Hirschman Realty's Senior Vice President, represented both buyer and seller in the $11.2 million transaction.

Because the building was one of Cali Realty's buildings backed by Real Estate Mortgage Investment Conduit (REMIC) bonds that do not allow pre-payment of the loan, Cali was required to obtain a release of the mortgage liens on the property from the institutional holders of the bonds, as well as the servicer and the trustee. In addition, time constraints by both the buyer and seller resulted in a faster than usual due diligence process which was accommodated by David Hirschman Realty.

"Timing was absolutely critical in this sale," explained Steiger. "In order for it to take place, the REMIC bonds financing Century Plaza had to be pre-paid, a 1031 exchange property had to be found and designated, and both transactions had to close within a twenty day window of opportunity. The Valley Hospital's only concern was acquiring the building in the first quarter of 1996 to meet their critical need for additional space. This entire process took less than four months, while a complex transaction of this type normally takes twice as long."

The 132,000 square foot Century Plaza is five-stories and is adjacent to the Garden State Parkway. Constructed 17 years ago, the building is currently 56 percent leased. The Valley Hospital, based in Ridgewood, NJ, will use substantially all of the vacant portions of the building to consolidate several departments now housed in buildings off the hospital's main campus. In the new building, Valley will locate its Planning/Marketing functions, Patient Accounting and Computer Services. In addition, Valley's extensive Home Care Agency will be headquartered at Century Plaza.

"The primary reason this acquisition made sense to The Valley Hospital is that it met our requirements of having a nearby building where we can consolidate off-site functions," said Everett Ferri, vice president of Facilities, The Valley Hospital.

In connection with the sale, Cali Realty announced the purchase of 103 Carnegie Center in Princeton, NJ, and its intention to exercise its option on 3.3 acres of land in Totowa, NJ. In order to qualify as a tax free exchange, the Company will use the net proceeds from the sale of Century Plaza to acquire these properties.

"This transaction allows the Company to re-deploy its capital at a significantly higher return and to increase its Funds From Operations without expanding capital or incurring additional debt," Thomas A. Rizk, Cali's president and CEO said.

Roger Thomas, vice president and general counsel, confirmed the intricacies of the transaction, noting that David Steiger, "Worked through several difficult challenges to bring about the successful resolution of this sale. Without David and his support staff, this transaction never would have closed."

Valley's Ferri concurred with Thomas, adding that Steiger was intricately involved with every aspect of the transaction. "David Steiger exhibited the highest level of concern in reviewing every document two or three times. Just as important to the hospital, David acted in a most professional manner during the entire course of this transaction."

David Hirschman, president of David Hirschman Realty Co., based in Paramus, added that the challenges of the transaction and the effort employed by all parties, "made the successful resolution of the deal much more sweet. We're happy to have structured a transaction where all parties have clearly come out ahead."

Hirschman's Steiger credited several individuals for "making this deal a reality." From Call, he cited Roger Thomas, Tony Bemheim, Director of Acquisitions, and Barry Lefkowitz, Chief Financial Officer, for their insight and financial creativity. Everett Ferii and Richard Keenan, Senior Vice President, Chief Financial Officer, from Valley also provided critical components to the favorable outcome of the transaction.

"The real estate and fiance professionals at Cali Realty and The Valley Hospital, while facing significant challenges during the due diligence process, remained focused on a timely closing," Steiger said. "Positive, creative thing was paramount in this deal, and we commend both parties for working together to achieve this remarkable success."