8B — October 12 - 25, 2012 — New Jersey — Mid Atlantic Real Estate Journal


s outherN N ew J ersey

including increased deal activity among large corporations WCRE finds positive trends in third quarter


OORHEES, NJ — While cautious opti- mism was the tone of

historic lows, and all REITs in the market performing better than in the previous quarter. This good news was tempered by factors that are causing some businesses and investors to stay on the sidelines a while longer. “This extended period of very low interest rates coupled with low rental rates continues to encourage activity, but world events such as the slow recov- ery of the U.S. economy, the on- going European financial crisis, and fears about what some are calling a “fiscal cliff” of tax in- creases and government spend-

ing cuts set for early next year will continue to influence the timing of real estate decisions,” said Jason Wolf , founder and principal of WCRE. “A slower summer period is the norm in commercial real estate, as is the practice of busi- nesses holding off on major in- vestments and other decisions shortly before a presidential election,” Wolf said. “I believe we will see the market improve due to pent-up demand once we move past these cyclical events.” According to the WCRE of- fice report, there were about 300,000 s/f in renewals and new lease transactions in Southern New Jersey during the quarter, with renewals comprising most of the transactions. This is down from more than 450,000 s/f in the second quarter. Other office market highlights from the report: Average rents for class A & B product remained at the improved level they reached in the second quarter, continuing to show strong support in the range of $10-$14.00/sf NNN with an overall market average of $11.00/sf NNN for the deals completed during the third quarter. Positive absorption for the third quarter was in the range of 106,000+/-sf of new deals and/or expansions. This represents a 15 percent de- crease from the volume of positive absorption in the second quarter. Moorestown, Marlton and Mount Laurel continue to show strength, while a large share of the region’s vacancies remain in Voorhees, Pennsauken, and the west side of Cherry Hill. There are several large of- fice buildings and portfolio sales, along with other large transactions pending that are expected to close during the fourth quarter. Tenants continue to take advantage of low rental rates and are securing long-term lease commitments. The pat- tern of this flight to quality – upgrading to better locations and spaces – is expected to continue. Retail market highlights from the report include: Overall retail space vacancy is still hovering in the 17-18% range, but the market has sta- bilized, and prime retail loca- tions have very little vacancy. Average rents for class A continued on page B

the second quarter in the local commercial real estate market, the third quarter was more about caution than optimism, Wolf Commercial Real Es- tate said in its latest quarterly analysis of Southern New Jer- sey. But those expecting better news can take solace in the fact that the firm found many posi- tive trends, and even some of the bad news was either cyclical or expected. WCRE’s research, which includes snapshots of the of-

Jason Wolf

Leor Hemo

Scott Seligman

second quarter. These include increased deal activity among large corporations – several of which were seeking new headquarters in the region, interest rates remaining near

fice and retail markets, finds several positive indicators that kept the Southern New Jersey market active in the third quarter, just not with the same velocity it had in the

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