6B — January 22 - February 18, 2021 — Northern New Jersey — M id A tlantic Real Estate Journal
www.marej.com
S outhern NJ Investment activity & large transactions stalled, while industrial showed strength WCRE 4 th Qtr. 2020 report: Pandemic uncertainty ripples through Southern NJ & Phila. region
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ommercial real estate brokerage WCRE re- ported in its analysis
ket, and there is sufficient mo- mentum in the overall economy that the downturn is expected to be temporary. “Commercial real estate is challenged by many of the conditions brought on by the pandemic, but the roll-out of the vaccines brings the hope of a return to normal activity sometime this year,” said Ja- son Wolf , founder and manag- ing principal of WCRE. There were approximately 252,823 s/f of new leases and renewals executed in the three counties surveyed (Burling- ton, Camden and Gloucester), which was a drop of nearly
58% from the previous quarter. New tenant leases comprised approximately 64,450 s/f, or ap- proximately 25.5% of all deals for the three counties surveyed. Other office market high- lights from the report: • Overall vacancy in the market is now approximately 13.6 percent, which is a jump of about two-thirds of a point from the previous quarter, and an increase of two full points since Q2. • Average rents for class A & B product remain un- changed, as they continue to show strong support in the range of $10.00-$15.00/sf NNN
or $20.00-$25.00/sf gross for the deals completed during the fourth quarter. These averages have hovered near this range for more than a year. • Vacancy in Camden Coun - ty increased to 15.2% for the quarter, but despite this slight increase, Camden County saw gradual improvement and prospect activity. • Burlington County’s va - cancy increased to 12% after dropping more than a point during the third quarter. WCRE has expanded into southeastern Pennsylvania, and the firm’s quarterly re- ports now include a section on
transactions, rates, and news from Philadelphia and the suburbs. Highlights from the fourth quarter in Pennsylvania include: • The vacancy rate in Phila - delphia’s office market rose another half a point, to 9.6%, after having hovered near a 20-year low. The pandemic has caused a large volume of office space to hit the market. • The industrial sector in Philadelphia led the market, as it generally does. During Q4 vacancy rates ticked down to 5.1%, a slight improvement from the previous quarter. Net absorption for the year was 6.1 s/f. As the pandemic has led to a massive shift toward e-commerce, the industrial sector should remain quite strong. • Retail CRE remains the most responsive and most vulnerable sector to market conditions. Ongoing corona- virus prevention measures have led to increased vacancy as businesses shutter. Aver- age retail net absorption for 2020 was 1.8 million s/f. The vacancy rate is not expected to improve in the near term. WCRE also reports on the Southern New Jersey retail market. Highlights from the retail section of the report include: • Retail vacancy in Camden County ticked up to 10.5% after posting a large increase from Q2 to Q3. While average rents changed little, in the range of $11.78/sf NNN. • Retail vacancy in Burling - ton County jumped to 10%, up from 7.6%, with average rents increasing to the range of $14.14/sf NNN. • Retail vacancy in Glouces - ter County went up again, to 13.7 increasing throughout the year, with average rents unchanged in the range of $13.14/sf NNN. About WCRE WCRE is a full-service com- mercial real estate brokerage and advisory firm specializ- ing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client- focused relationships. MAREJ
of the fourth qua r t e r o f 2 0 2 0 t h a t the Southern New Jersey and South- e a s t e r n Pennsylva- nia markets took an ex-
Jason Wolf
pected downturn in many sec- tors due to the ongoing corona- virus pandemic. At the same time, restrictions and infection control measures helped build strength in the industrial mar-
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