M id A tlantic Real Estate Journal — Southern New Jersey — January 21 - February 17, 2022 — 9B S outhern NJ id tlA tic e l st t r l t rs — r 21 - e r ary 17, 2022 9 n
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Industrial continues record-breaking run, while return-to-office plans are again delayed WCRE 4 th Qtr. 2021 Report: Momentum In SNJ and Philly markets stymied by surging Omicron variant WCRE 4 t
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during Q4, with $39,471,750 in completed sales comprising 487,707 s/f. • 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/sf gross for the deals completed during the quarter. 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 fourth quar- ter in Pennsylvania include: • The vacancy rate in during 4, ith $39,471,750 in co pleted sales co prisi g 487,707 s/f. • Average rents for class B product re ain unc a ge , as they continue to sho stro g support in the range of $10.0 - $15.00/s/f or $20.0 - $25.00/sf gross for t e e ls co pleted during the q arter. CR has expanded i to southeastern ennsylva ia, and the fir 's quarterly reports no include a section o tra s- actions, rates, and ne s fro Philadelphia and the s b r s. ighlights fro the fo rt q r-
Philadelphia’s office market remained unchanged in Q4, still at 10.3% after hover- ing near a 20-year low for months. The office leasing market began to recover in 2021, but is still 20% below the three-year average before the pandemic. • The industrial sector in Philadelphia continued its impressive run, buoyed by its integral role in e-commerce. The last year saw a remarkable 15.2 million s/f of net absorp- tion and 12.6% rent growth. This is all the more impressive in a market that added 12.2 million s/f of new industrial l i ’ ffi t , - r i i still t . ft i r - l f t . ffi l i r t t i , t i till l t t r - f t i . i t i l t i il l i ti i i r ssi , i i t r l r l i - . l t l . illi /f f - . ti . is i ll t i i i t t t . illi /f f i i l il
in Q3. • Retail vacancy in Camden County posted a slight im- provement to 10.1%, while av- erage rents fell about 40 cents, in the range of $11.43/s/f NNN. • Burlington County retail vacancy jumped to 9% in Q4, giving back improvements from the previous quarter. Av- erage rents rose to the range of $14.55/s/f NNN. • Gloucester County posted a decrease of more than three points, to 11.3 %, building on a solid improvement in the previ- ous quarter, with average rents jumping more than 10%, to the range of $15.50/s/f NNN. MAREJ l cester o ty posted cr s of ore t a t ree i ts, t . , il i g on a li i r e e t i t e previ- rt r, it average rents j i re t 0 , to the f . /s/f N . M REJ i . et il c cy i a den t oste a slight i - ile av- r re ts fell bo t 40 cents, i t r e of 1.43/s/f N . rli to o ty retail c c j e to 9 i 4, i i c i rove ents r e t to .1 , fr t re io s q arter. Av- r r ts rose to t e ra ge of . /s/f .
ARLTON, NJ — Comme r c i a l r ea l es t a t e br oke rage ARLTON, NJ Comme r c i a l r ea l es t a t e br oke rage
space this year. • Retail remains the sector most responsive to market conditions, but it has also proved to be the most adapt- able. Average retail net absorp- tion in Philadelphia went into a tailspin when the pandemic began, but for the 12 months just concluded, it is back in positive territory, at a healthy 1.3 million s/f. WCRE also reports on the Southern NJ retail market. Highlights from the retail sec- tion of the report include: • The Consumer Confidence Index rebounded in November and December, after dipping fi t il i t ct r t i t t it t iti , l t t t t- l . t il t - i i il l i t i t il i t i , f t j l , i i i i i i , lt . illi /f. l t il t. i li i f f il - i l :
WCRE r e - ported in its analys i s of t he f ou r t h quarter that t h e p o s t - p a n d e m i c recovery in the Southern New Jersey WCRE r e - ported in its analys i s of t he f ou r t h quarter that t h e p o s t - p a n d e m i c recovery in the Southern New Jersey
Jason Wolf Jason Wolf
and Southeastern Pennsylva- nia markets was pushed off its track by the Omicron variant. While CRE seemed to rebound along with the broader economy during the spring and summer, the one-two punch of the Delta variant followed by the highly transmissible Omicron variant is dampening demand, increas- ing vacancy, and reverberating in several ways. Before the variants emerged, Covid-19 cases had fallen to the lowest levels since the onset of the pandemic, and many busi- nesses scheduled their official return-to-office plans to begin the week after Labor Day. Those plans were delayed by Delta, and delayed even further by Omicron. The effects of this shift are being felt throughout the economy. “Industrial is on a tear, as it has been throughout the year. But the office and retail mar- kets are pulling back and put- ting plans on hold while Omi- cron is rampant,” said Jason Wolf, founder and managing principal of WCRE. “The good news is that a strong pipeline remains intact, and owners report that their tenants are showing signs of stability and growth.” In the fourth quarter there were 322,881 s/f of new leases and renewals executed in the three counties surveyed (Bur- lington, Camden and Glouces- ter), a substantial gain over the third quarter. New tenant leases comprised approximate- ly 208,135 s/f, or about 65% of all deals for the three counties. These also represent double- digit percentage improvements over the third quarter. Other office market high- lights from the report: In the fourth quarter there were 3 2, 81 s/f of new leases and renewals executed in the thr e counties surveyed (Bur- lington, Ca den and Glouces- ter), a substantial gain over the third quarter. New tenant leases comprised a proximate- ly 208,135 s/f, or about 65 of all deals for the thr e counties. These also represent double- digit percentage improve ents over the third quarter. Other o fice arket high- lights from the report: • Overall vacancy in the market is now 13.65%, nearly a full point above the previous quarter. • The sales market main - t a i ned momentum, wi th 1,424,029 s/f actively on the market or under agreement. • Completed sales improved • Overa l vacancy in the market is now 13.65 , nearly a full point above the previous quarter. • The sales arket ain - t a i ned o entu , i th 1,424,029 s/f actively on the market or under agr e ent. • Completed sales improved and Southeastern Pe nsylva- nia markets was pushed off its track by the Omicron variant. While CRE s emed to rebound along with the broader econo y during the spring and su er, the one-two punch of the Delta variant followed by the highly transmi sible O icron variant is dampening demand, increas- ing vacancy, and reverberating in several ways. Before the variants e erged, Covid-19 cases had fallen to the lowest levels since the onset of the pandemic, and many busi- ne ses scheduled their o ficial return-to-office plans to begin the w ek after Labor Day. Those plans were delayed by Delta, and delayed even further by Omicron. The e fects of this shift are being felt throughout the economy. “Industrial is on a tear, as it has b en throughout the year. But the o fice and retail ar- kets are pulling back and put- ting plans on hold while O i- cron is rampant,” said Jason Wolf, founder and anaging principal of WCRE. “The g od news is that a strong pipeline remains intact, and o ners report that their tenants are showing signs of stability and growth.”
ter in Pennsylvania i cl e: • he vaca cy r te i i , f i i FULL SERVICE COMMERCIAL REAL ESTATE BROKERAGE & ADVISORY FIRM
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