Real Estate Journal — Brokerage Directory — July 27 - August 9, 2018 — 11C


M id A tlantic

B rokerage D irectory

arket West emerged from the second quar- ter with net positive JLL Philadelphia Blocks shuffle as tenants relocate, but with in- bound leasing down, absorption remains stagnate M

that the eastern-facing portion of the building will be redevel- oped into residential or hotel. A proposal from the Philadelphia Bar Association and other non- profit partners would bring a new 173,000 s/f office building to 8th and Vine to house the Equal Justice Center, offsetting any inventory reductions at Public Ledger and bringing new groundup construction product to this part of the city for the first time in decades. Outlook Leasing velocity will acceler- ate throughout 2018 as several in-market tenants attempt to

lock up the few quality blocks on offer. The rate and size of inbound deals will determine just how tight the existing in- ventory becomes in the second half of the year and whether new construction might be- come necessary for the largest tenants weighing options for headquarters space. For now, restacks and consoli- dations are keeping pace with expansions and inbound leas- ing, creating a tenuous equilib- rium that’s holding vacancy and rents steady and maintaining a neutral to negative absorption environment. 

absorption, a welcome change from recent history, but largely the result of long-planned relo- cations of existing tenants. 1735 Market continued to backfill its large blocks: Montgomery McCracken settled in on three floors, opening up the high- rise at 123 South Broad, and Brandywine Global has begun its transition back across the Schuylkill, creating a large block at Cira Centre. Depar- tures and downsizings continue to offset gains, with Four Penn Center now marketing five full floors in the wake of CHUBB’s departure and Equus decamp- ing for Newtown Square’s Ellis Preserve. Sciences’ 166,791 s/f lease at 1100 Campus Rd. in Princeton, and Plymouth Rock’s 129,600 s/f lease at 581 Main Street Wood- bridge, illustrate the improved leasing activity; and robust tenant demand led to positive net absorption of 339,617 s/f. The availability rate improved to 18.5%, the lowest since 1Q 2008. Positive movement in the average asking rate also occurred this quarter, closing at $25.63 psf, an improvement of $0.11 psf over the last quarter. “Northern New Jersey’s slow start to the year impeded the progress of the market as a whole,” said John Obeid , senior director, Tri-State Sub- urban Research for Colliers. “Despite that, after recording just eight transactions over 100,000 s/f between 1Q 2017 and 1Q 2018, there were seven such transactions in the second quarter alone. Leasing activity increased by 31% quarter-over- quarter to 2.9 million s/f, which brought the mid year total to 5.1 million s/f. Increased activity, together with the ongoing adap- tive reuse trend has kept the availability rate below 20% for the third consecutive quarter and, at 19.7%, is an improve- ment of 100 basis points from last year.” As obsolete office product comes off the market and more owners put money into renovat- ing their buildings, the average asking rent has been steadily rising, particularly in the class A sector where it improved 6.3% over the last three years to $29.62 psf.  continued from page 10C NJ industrial leasing demand . . .

and the departure of Health and Human Services to 801 Market creates opportunities to attract a new tenant mix. It is likely

In Market East, the Public Ledger Building is poised to re- position as the western portion of the building changes hands

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