Mid Atlantic Real Estate Journal — December 20, 2013 - January 16, 2014 — 21A
www.marejournal.com
Saddle Brook, NJ — “Industrial real estate is the most talked-about sector—and it is hot. Demand for class A space in particular is up.” That was the overview provided by Kim Bren- nan, Senior Managing Director-New Jersey Region for Cushman & Wakefield, moderating a panel titled “The Changing Face of Industrial Real Estate.” That panel provided the focus for the November monthly meeting of CREW NJ at the Saddle Brook Marriott. Where is the demand coming from? “Third-party logistics [3PL] users, regional, local and national, are very active,” said Albert Corr, Senior Vice President of KTR Capital Partners. “E-commerce is a major driver,” he said, noting the influx of “big box” space users in excess of over one million square feet has increased in the northeastern and central Pennsylvania markets. For the Garden State, “it is hard to find space/sites in Northern New Jersey that can accommodate buildings of that size,” he said, with more big box activity focused in the New Jersey Turnpike Exit 7A and 8A markets. Third-party Logistics, Especially E-commerce, is Driving the Industrial Market, CREW NJ Members Told “Concessions are still available,” said Kim Stirba-Reynolds, Senior Investment Manager for The Hampshire Companies. “However, the level of concessions depends on the location and whether the project is new. There has also been a push on rents.” “Well-located Class A ,350,000-square-foot-plus facilities are hot, but there is not a plethora of them anywhere in the market,” said William Waxman, Executive Vice President, CBRE. And for purposes of enhancing distribution, “larger tenants will consider multiple locations,” rather than consolidating at one “big box” space or consider moving further from their ground zero. The regional search is certainly back. “And E-commerce in particular has changed the face of the warehouse/distribution facility,” Corr noted. Among the changes: Higher ceiling heights, the addition of mezzanine structures, very sophisticated pick/handling equipment, cross-dock layouts and additional car parking requirements “There is also additional parking required to meet the increased workforce requirements,” said Stirba-Reynolds. “Location near highways is also increasingly important—it’s all about getting product directly to the customer.” From a cost standpoint, it’s not strictly a matter of rent for this new-age facility. Factoring in the sophistication of the E-commerce distribution facility, “tenants are asking, ‘what is it going to cost per pallet?’” said Waxman. “Tenants are looking for new ways to price a building—it has become a more sophisticated business. It is a matter of ‘thinking outside the square foot- age’,” he said. Location incentives, particularly those offered under the revised GROW NJ program included in the recently enacted Economic Opportunity Act of 2013 , “are a lot more beneficial to in- dustrial clients than the previous programs,” said Susan Harte, Esq., First Vice President of CBRE. “The new program has taken away the per project overall dollar amount required capital investment and replaced it with a per square foot minimum investment. “Warehousing is a targeted industry and therefore receives bonus amounts under the new GROW NJ Program,” she said, noting that in the competitive wars with neighboring states, “In most cases, Pennsylvania’s incentives don’t come close to the new New Jersey incentives.” On the much-discussed subject of raising the Bayonne Bridge to accept the new, larger Panamax vessels, Waxman indicated that “there will be growth at our ports,” but it might not be as much as people think. For various reasons, “a lot of shipments will still go overland from the West Coast.” “The bridge project will help, but it is difficult to quantify what the impact in New Jersey will be,” said Corr. In terms of investment in the current market, “there is a frenzy,” said Corr. “It is difficult to buy in New Jersey because not a lot of properties are trading compared to other markets. For those quality properties that become available, there is a deep buyer pool.” Introducing the program, “the purpose of CREW is to foster networking and education,” said chapter president Patricia Riedel of CBRE. She also introduced several new members, noting that the chapter’s membership “has risen to 115.” “Charity is also an important part of what we do,” she said. “Our thanks to those who have contributed to this month’s philanthropy – the CREWNetwork Foundation, which gives members the unique ability to help women and girls succeed in the commercial real estate industry.” n “And concessions to tenants have come down,” Corr said. “Users are competing with investors, and that is driving prices up,” said Waxman.
2013 BOARD OF DIRECTORS
President & CREW Delegate Patricia Riedel, CBRE, Inc. patricia.riedel@cbre.com
President-Elect & CREW Delegate Monica Ceres, Giordano Halleran & Ciesla mceres@ghclaw.com Immediate Past-President & Advisor Cheryl Hardt, CBRE, Inc. cheryl.hardt@cbre.com Treasurer Rebecca Machinga, WithumSmith+Brown, PC rmachinga@withum.com Recording Secretary Stacey Weinberg, Federal Business Centers sweinberg@federalbusinesscenters.net Director, Membership Mary Lynn Kearns, Dancker, Sellew & Douglas mkearns@dancker.com
Director, Programming Marta Villa, CBRE, Inc. marta.villa@cbre.com Director, Philanthropy Rachel Brindisi rmbrindisi@gmail.com
Co-Director, Sponsorship Diane Menard, Prestige Title Agency, Inc. diane.menard@prestigetitle.net
Co-Director, Sponsorship Patricia Faulkner, NAI Global pfaulkner@naiglobal.com
Director, Special Projects-Golf Robin Grossman, Zycus rgros30687@aol.com
Director, Special Projects - Website/PR Susan Karp, Cole, Schotz, Meisel,
Forman & Leonard, P.A. skarp@coleschotz.com
Advisor Silvana Finizio, Carousel Industries of North America sfinizio@carouselindustries.com
Advisor & By-Laws Sheila Nall, KSS Architects snall@kssarchitects.com www.crewnj.org
Made with FlippingBook - Online catalogs