www.marej.com M id A tlantic Real Estate Journal — Spring Preview —April 23 - May 20, 2021 — 15C S outhern N ew J ersey & P hiladelphia PA Good news on public health and the economy holds the promise of better days ahead for CRE WCRE 1 st Qtr. 2021 Report: Southern NJ &Philly markets down due to the pandemic, but not out
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market. Highlights from the re- tail section of the report include: • The Consumer Confidence Index rose slightly in February, before rocketing to its highest level in a year in March. • Retail vacancy in Cam - den County ticked up to 10.9 percent after posting a large increase in the middle of 2020. While average rents changed little, in the range of $11.76/s/f NNN. • Burlington County inched up to 10.4 percent, represent- ing a small increase on top of the jump from7.6 percent in Q3 2020. Average rents increased
to the range of $14.39/s/f NNN. • Gloucester County saw the biggest jump, up to 15.9 after increasing throughout last year, with average rents up almost a full dollar per s/f in the range of $14.11/s/f NNN. The full report is available upon request. About WCRE WCRE is a full-service com- mercial real estate brokerage and advisory firm specializ - ing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. MAREJ
ARLTON,NJ –Com- mercial real estate brokerage WCRE
WCRE has expanded into southeastern Pennsylvania, and the firm's quarterly reports now include a section on trans- actions, rates, and news from Philadelphia and the suburbs. Highlights from the first quar - ter in Pennsylvania include: • The vacancy rate in Phila - delphia’s office market rose another half a point, and now stands at 10.1 percent, after hovering near a 20-year low. Despite the pandemic fallout, the city is still seeing rent and occupancy levels ahead of other major markets. • The industrial sector in
Philadelphia remained the bright spot. The last year saw 4 million s/f of net absorption and 7.8% rent growth. • Retail remains the most re - sponsive to market conditions and the most vulnerable sector. Infection prevention measures and other economic pressures have brought existing issues from before the pandemic into sharper relief. Average retail net absorption for 2020 was 1.8 million s/f, but for the 12 months just concluded, it is -1.4 million s/f. WCRE also reports on the Southern New Jersey retail
reported in its analysis of the f irst quarter of the new year that the Southern New Jersey and South- e a s t e r n Pennsylvania
Jason Wolf
markets may be through the worst of the downturn brought on a year ago by the pandemic. The widespread availability of effective COVID-19 vaccina- tions, coupled with large-scale financial relief from the federal government, may bring an opti- mistic note back to the market. For the moment, market per- formance on several indicators remains off. “CRE performance in the first quarter seems to be track - ing with our lived experience. As expected, office vacancy is quite high, while demand for industrial space is surging,” said Jason Wolf, founder and managing principal of WCRE. “Market fundamentals are shaky, but there are pockets of strength and resiliency.” There were approximately 555,988 s/f of new leases and renewals executed in the three counties surveyed (Burling- ton, Camden and Gloucester), which was more than double the previous quarter. New tenant leases comprised ap- proximately 44,952 s/f, or only about 8% of all deals for the three counties. Other office market high- lights from the report: • Overall vacancy in the mar - ket is now approximately 13.55 percent, virtually unchanged from the previous quarter, and an increase of two full points since Q2 last year. • Unsurprisingly, office va - cancy rates have risen through- out the region. At 11.2%, the rate is the highest it’s been since 2014. • On the other end of pan - demic-induced usage shifts, the already strong industrial vacancy rate improved to 5.4%. • Average rents for class A & B product remain unchanged, as they continue to show strong support in the range of $10.00- $15.00/s/f NNN or $20.00- $25.00/s/f gross for the deals completed during the quarter. These averages have hovered near this range for more than a year.
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