8B — October 13 - 26, 2017 — Southern New Jersey — M id A tlantic
Real Estate Journal
www.marejournal.com
S outhern N ew J ersey
Southern New Jersey & Philly CRE Markets performing steadily WCRE Q3 2017 Report: Fundamentals remain strong
M
lights from the report: • Overall vacancy in the mar- ket is now 9.75 percent, which is a solid improvement over the previous quarter. • Average rents for Class A & B product continue to show strong support in the range of $10.00-$14.50/sf NNN or $20.00-$24.50/sf gross for the deals completed during the quarter. These averages have stayed within this range for most of this year. • Vacancy in Camden Coun- ty maintained its dramatic improvement, standing at 10.8 percent for the quarter, down
from 13.3 percent at the begin- ning of the year. 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 first quar- ter in Pennsylvania include: • The Philadelphia indus- trial market continues its hot streak, and the outlook is positive. Vacancy rates for flex and industrial properties in Philadelphia are well below the regional and national aver- ages, and this is expected to continue. • Philadelphia's office mar- ket continues to gain strength across the board, with far lower vacancy rates than regional and national averages for both Class A and Class B proper- ties in the Central Business District and the suburbs. We see increasing employment and new construction, both of which bode well for continued strength. • The Philadelphia retail sec- tor is the one area that is not performing well. It has been affected by the same challenges facing retail businesses every- where. Namely, the massive shift to online retailing and away from brick-and-mortar. Still, there were some positive signs amid the announced store closings and bankruptcies. Community shopping centers remain an area of strength in the market, with vacancy rates nearly half the national average. WCRE also reports on the Southern New Jersey and Philadelphia retail market, noting slight declines in con- sumer confidence and related metrics as the third quarter wound down. Overall retail sales were 3.2 percent higher this year compared to 2016, and were likely impacted by the major hurricanes affect- ing Texas and Florida in late August and early September. Highlights from the retail sec- tion of the report include: • Retail vacancy in Camden County stood at 9.5 percent, with average rents in the range of $12.47/sf NNN. • Retail vacancy in Burl- ington County stood at 10.7 percent, with average rents in the range of $13.38/sf NNN. • Retail vacancy in Glouces- ter County stood at 7.9 percent, with average rents in the range of $14.10/sf NNN. n
indicate a period of strength,” said Jason Wolf, founder and managing principal of WCRE. “The national economy has been adding jobs, the financial markets are on a hot streak, and our market continues to attract outside investors – yet increased activity and enthusiasm are tempered by trouble in the retail sector and uncertainty related to current events.” There were 421,113 s/f of new leases and renewals ex- ecuted in the three counties surveyed (Burlington, Cam- den and Gloucester), which
represents an increase of 6.6 percent compared with the previous quarter, and a 15 percent increase over the same period last year. While leasing showed moderate gains, the sales market was quite active during the third quarter, with more than 1.76 million s/f worth more than $105 million of completed sales transactions trading hands. New leasing activity account- ed for 43.3 percent of all deals. Overall, net absorption for the quarter was in the range of 91,600 s/f. Other office market high-
arlton, NJ — Comme r c i a l r ea l es tat e brokerage
WCRE r e - ported in its latest quar- terly analy- sis that the S o u t h e r n New Jersey market is in good shape, but remains in somewhat of a holding pat- tern. “For most of 2017 we have seen an overall positive tone and conditions that usually Jason Wolf
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