B — October 11 - 24, 2013 — New Jersey — Mid Atlantic Real Estate Journal
www.marejournal.com
S outhern N ew J ersey
oorhees , NJ —A i d e d b y i n - creased confidence Area Bucks traditional summer slow-down, spurred by growth and policy moves WCRE Third Quarter Report: Southern New Jersey Market V
ing what has traditionally been the slowest quarter of the year, the firm identified approximately 443,173 s/f of new leases and renewals executed - a gain of nearly 48% compared to the third quarter of 2012. New leasing activity accounted for ap- proximately 57% of the total transactions, a sign that the regional CREmarket is truly in recovery mode. “Instead of a summer slow- down we found many signs that optimismand confidence have returned,” said Jason Wolf , founder and princi-
pal of WCRE. “There were several large lease transac- tions, slight improvement in the state’s unemployment rate, repositioning projects commenced or have been an- nounced, and near the end of the quarter, a new state law was signed that is expected to retain and attract many new businesses to the South Jersey region.” The new law is the Eco- nomic Opportunity Act of 2013, which created Grow New Jersey (GrowNJ) and the Economic Redevelopment and Growth Program (ERG).
These programs are designed to incentivize growth and in- vestment by large and small companies across several industries. WCRE reported encourag- ing news even in areas that had been vulnerable, par- ticularly Camden County. Vacancy rates continued to fall slowly, coming in at 17% for the region, with Camden County at 21% and Burling- ton stronger at 13%. “This market is still challenged by a surplus of vacant space, but we have seen steady progress in positive absorption for
several consecutive quarters, and the conditions are in place to potentially speed up the pace,” Wolf said. WCRE’s research includes snapshots of the office and retail markets and details on the major deals being con- summated or planned. Office market highlights from the report: • Total leasing activity for the quarter comprised 443,173 s/f of new leases and renewals executed. • New lease and expansion deal activity comprised ap- proximately 252,631 square feet. This is a 37% increase over Q2 figures. • Positive absorption for the second quarter was in the range of 148,000+/-s/f of new deals and/or expansions. • Average rents for Class A & B product were up by 5% over the previous quar- ter. Rents continue to show strong support in the range of $11.00-$14.00/s/f NNN or $21.00-$24.00/s/f gross, with an overall market aver- age showing strong support in the $11.60/s/f NNN or $21.60/s/f gross for the deals completed during the third quarter. • The unemployment rate in New Jersey ticked down from 8.6 percent at the end of Q2 to 8.5 percent at the end of Q3. It has dropped steadily over the past year, and is now at the lowest point since March 2009. Fig- ures continue to improve, but the state rate remains above the national rate of 7.3%. Retail market highlights from the report include: • Area retail businesses and landlords did experience the expected summer slow- down in the form of slower growth, but growth remained positive. • Overall retail space va- cancy has continued to drop. It hovered around 10.5% for the quarter, compared to 15% in the previous quarter. •Average rents for upscale lifestyle centers continue to show strong support in the range of $30-$40.00/s/f NNN, and average rents for neigh- borhood and strip shopping centers remain in the range of $15-$23/s/f NNN. The full report, including details about several key deals, is available upon re- quest. n
among area businesses, and further boosted by positive fi- n a n c i a l news , t he commercial real estate marke t i n
Jason Wolf
Southern New Jersey exceed- ed expectations in the third quarter, according to a new report by Wolf Commercial Real Estate (WCRE) . Dur-
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