10B — April 13 - 26, 2018— Southern New Jersey — M id A tlantic
Real Estate Journal
www.marejournal.com
S outhern N ew J ersey
WCRE First Quarter Report SNJ & Philly Cre Markets see moderate gains amid tax reform optimism and financial market shakiness
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to reverberate in personal and corporate checkbooks. “Our market appears to have picked up steam, with a healthy pace of business growth and continuing new investment,” said Jason Wolf, founder and managing principal of WCRE. “Despite corrections ending a long winning streak in the financial markets, the benefits of the new tax law should shore up commercial real estate, es- pecially industrial and office demand.” There were approximately 272,550 s/f of new leases and renewals executed in the three
counties surveyed (Burlington, Camden and Gloucester), which was a gain of 23% over the pre- vious quarter. Leasing picked up, and the sales market stayed active, with about 1.63 million s/f on the market or under agreement and an additional 320,691 s/f trading hands. The sales figure is a 36% increase over the previous quarter. New leasing activity account- ed for approximately 77.2% percent of all deals. Overall, net absorption for the quarter was in the range of approximately 105,250 s/f. Both of these fig- ures represent large increases
over the fourth quarter. Other office market high- lights from the report: • Overall vacancy in the market is now approximately 11.2%, which is more than a full point higher than the previous quarter. This may be attributed to large blocks of space return- ing to the market. • 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 County improved steadily last year, but jumped nearly a point to 12.5% for the quarter. • Burlington County vacancy was at 9.9%, which was also higher than the fourth 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 first quar- ter in Pennsylvania include: • Having closed out 2017 with a strong fourth quarter, Philadelphia's office market be- gan the year seeing increasing employment and new construc- tion, both of which bode well for continued strength. The outlook for this sector is good. • The Philadelphia retail sector performed well in 2017, seeing gains over the previous year in both retail sales volume and employment. Analysts ex- pect this trend to continue even as national retail figures have trended downward in recent years. Amid declining rents, leasing activity picked up. • The Philadelphia indus- trial market continues its hot streak, and the outlook is posi- tive. Vacancy rates for flex and industrial properties in Philadelphia are well below the regional and national averages, and this is expected to continue. In 2017 this sector saw positive absorption in the range of 4.9 million s/f. WCRE also reports on the Southern New Jersey and Philadelphia retail market. The first quarter saw a continua- tion of the unfortunate trend of legacy brands such as Toys R Us and Sears closing stores and/or filing for bankruptcy protection. However, there was good development news in the region, with several healthcare, entertainment, and retail proj- ects receiving approval. Other highlights from the retail sec- tion of the report include: • Retail vacancy in Camden County stood at 8.4%, with average rents in the range of $13.75/sf NNN. • Retail vacancy in Burling- ton County stood at 10.4%, with average rents in the range of $14.24/sf NNN. • Retail vacancy in Glouces- ter County stood at 7.0%, with average rents in the range of $14.83/sf NNN. The full report is available upon request. n
arlton, NJ — Commer c i a l rea l estate 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 largely good shape, with
Jason Wolf
moderate gains in leasing activ- ity and strong fundamentals. The firm believes the market may be poised to take off as ben- efits of the new tax law begin
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