Mid Atlantic Real Estate Journal — New Jersey — April 11 - 24, 2014 — 7B
www.marejournal.com
S OUTHERN N EW J ERSEY WCRE analysis finds a strong start to 2014
WCRE first quarter report: Heavy snow did not dampen SNJ first quarter commercial real estate
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terly report were the closing of Liberty Property Trust’s disposition of its entire office/ flex portfolio in the region, and Brandywine Realty Trust’s listing a portion of its area portfolio for sale. The Lib- erty Property Trust portfolio, comprising 1,188,285 s/f in 24 buildings, was purchased by Somerset Properties. Bran- dywine has listed five office buildings totaling 397,000 s/f. Other office market high- lights from the report: • Burlington County contin- ued to maintain a significantly
lower vacancy rate than Cam- den County, at 9.6 percent compared with Camden’s 19.3 percent, though both counties saw decreases of more than a point this quarter. • Average rents for class A & B product continue to show strong support in the range of $11.00-$14.00/s/f NNN or $21.00-$24.00/sf gross, with an overall market average showing strong support in the $11.00-$11.50/s/f NNN or $21.00-$21.50/sf gross for the deals completed during the first quarter. This is es-
sentially unchanged from the previous quarter. • New lease activity for Q1 is in the range of approximately 215,910 s/f of new deals and/or expansions and approximately 181,231 s/f of renewals, for a total of approximately 397,141 s/f of leasing activity. • All of the major private owners and REITS showed a significant increase in pros- pect activity for the quarter, and are all cautiously optimis- tic for 2014. • Businesses that specialize in banking, consulting, gov-
ernment, information technol- ogy and financial services all were very active in Southern New Jersey during the first quarter. WCRE also reported on the local retail market, noting that the first quarter experienced a lull, which was driven in part by the weather and in part by a weak holiday shopping sea- son. Highlights from the retail section of the report include: • Overall retail vacancy in the tri-county area is hover- ing around 15.2%, up several continued on page 8B
he second snowiest win- ter on record couldn’t stop the enthusiasm in
the regional commercial real estate markets, ac- c o r d i ng t o t h e l a t e s t quarterly re- port by Wolf C o mm e r - c i a l Re a l
Jason Wolf
Estate (WCRE) . Driven by job gains and growth in some industries, the region bounced back from the slight slow-down of the fourth quarter, posting a 26 percent increase in s/f leased compared with the first quarter of last year. The report by the Southern New Jersey firm noted many positive trends during the first quarter, setting up for a solid 2014. “This year we’ve seen vacancy rates continue their slow, steady declines, unemployment in New Jersey heading in the right direction, and locally we have seen big shifts by some of the largest corporate players,” said Jason Wolf , founder and principal of WCRE. “A few national trends and headlines, such as declining unemployment nationwide, a cooling of in- ternational tensions, and ex- pected increases in consumer confidence, are fueling the increased activity we’ve seen in our region.” Even with historic severe weather, the CRE market was very busy during first quarter, with further stabilization of rents, the consummation of a mega-deal for a 24-build- ing office/flex portfolio, and another large group of assets coming onto the market. There were approximately 397,141 s/f of new leases and renewals executed in the three counties surveyed. Notably, expansions and newdeals remained strong this quarter, representing 54 percent of all transactions. Net absorption for the quarter was approximately 123,746 sf, a 20-point increase over the fourth quarter of 2013. The report noted that many of the quarter’s subject proper- ties were located in prime 3M locations within Burlington County, and that the tighten- ing of those areas was causing demand to shift toward large vacancies in Camden County. The two most noteworthy developments in the quar-
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