8B — February 8 - 21, 2019 — New Jersey — M id A tlantic
Real Estate Journal
www.marejournal.com
N ew J ersey
10.6 million s/f delivered in 2018 doesn’t offset record 12.8 million sf of absorption NewJersey IndustrialMarket records 17-year high for new development amid voracious demand F industrial space has been devel- oped in New Jersey since 2011, occupancy levels have grown can be largely attributed to leasing activity from retail- ers and wholesalers, manu-
LORHAM PARK , NJ — Despite a near- record amount of new development in 2018, New Jersey’s supply of industrial space is not keeping pace with the extraordinary demand, according to Transwestern’s Fourth-Quarter 2018 Indus- trial Market Report. The 10.6 million s/f of space that was delivered last year – the most since 2001 – was not enough to satisfy the insatiable appetite of tenants, which set a new record for net absorption. While the record-level ab- sorption of 12.8 million s/f
facturing and food-related c o m p a n i e s have emerged of late. With these indus- tries continu- ing to expand the i r pr e s - ence, vacancy
by 60 mi l - lion s/f dur- ing the same period. This has resulted in skyrock- eting rents, which have increased for 14 consecu-
rates dipped below 3.0 percent in 12 of the state’s 25 submar- kets, with seven submarkets reaching an all-time low. Although 35 million s/f of Jeffrey Furey
Matthew Dolly
tive quarters, and have risen to above $9 psf in seven sub- markets. “To be competitive in today’s environment, industrial ten- ants must take advantage of New Jersey’s unparalleled loca- tion at the center of the North- east Corridor,” said Jeffrey Furey , managing director at Transwestern. “The demand is so high that tenants are reset- ting the market when renewing leases, with no choice but to pay significantly higher rents.” New development is occur- ring primarily in the central part of the state, along the turnpike and between exits 7A and 13A, and, more recently, along the Interstate 287 cor- ridor. An additional 6.2 million s/f is under construction in the state’s core markets, with 5.1 million s/f in central New Jersey alone. Overall, vacancy across New Jersey reached an all-time low for the sixth consecutive quar- ter – a trend that’s expected to continue in 2019, despite new construction. “As the industrial market shows no signs of cooling, New Jersey faces some critical chal- lenges moving forward,” said Matthew Dolly , director of Research at Transwestern. “While the state boasts excel- lent air, freight, port, and rail infrastructure, upgrades are necessary. Unless critical needs are addressed, the state’s cur- rent infrastructure will have difficulty accommodating the growth that the industrial sec- tor presents.” Transwestern is a private- ly held real estate firm of collaborative entrepreneurs who deliver a higher level of personalized service – the Transwestern Experience. Specializing in Agency Leas- ing, Asset Services, Occupier Solutions, Capital Markets and Research, our fully integrated global enterprise adds value for investors, owners and occupi- ers of all commercial property types.
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