4B — May 25 - June 7, 2012 — Industrial / Distribution Centers — Mid Atlantic Real Estate Journal www.marejournal.com I NDUSTRIAL R EAL E STATE & D ISTRIBUTION C ENTERS By Steve Bussel, Bussel Realty Corporation Central New Jersey industrial real estate market T he real estate mar- ket is showing an improvement f or “Fortunately the industrial market is accelerating at a much better pace than the rest of the commercial market, yet corporate office space is still moving very slow.”
minds is expansion. At the present time, early 2012, the one shining light is the industrial real estate market. We have seen and experienced a dramatic in- crease in business. We see much more activity in the market, some net absorp- tion of space, and yes, even some increase in rental rates. There is a definite increase in sales activity, and as a result, an increase in sales prices as well. For the past three and half years, since late 2008, sales almost came to a halt. The
only sales we had seen were at fire sale prices. However, since the beginning of 2012 activity has increased, and prices along with it. With credit loosening up and in- terest rates still at historical lows, companies, as well as investors, are entering the market again. In Central New Jersey, in the peak of 2007 and early 2008, well situated buildings with good features, such as high ceil- ings, multiple loading docks and extra land, were selling at $80.00 to $110.00 per s/f. Right after 2008, these build- ings were selling at $45.00 to $65.00 per s/f. In early 2012, these same buildings are now selling at $60.00 to $80.00 per s/f. Encouragement at last! The same story applies to the rental market. Quality buildings in the peak were renting between $5.50 and $6.50 per s/f triple net. At the low point, landlords were afraid of the uncertainty in the market and scared of facing large vacancies. They ended renting space for $3.00 to $4.00 per s/f, just to avoid the vacancies. Today, with more activity in the market and less vacancies, landlords are leasing space at $4.00 to $5.50 per s/f. Again, these examples are in Central New Jersey, for quality properties with desirable features. The political climate in the US and globally is tenuous at best. Therefore, there are still a lot of uncertainties in all segments of the real estate market and most landlords, investors and corporate users are cautious, but optimistic. Steve Bussel, SIOR, pres- ident of Bussel Realty Corporation has been en- gaged in the corporate and commercial real es- tate business since 1973. He started Bussel Realty Corp. in 1984, in Middle- sex County, specializing in industrial real estate. Since then the company has grown from a one man operation, to include over 20 sales professionals, who specialize in all forms of corporate and commer- cial real estate, with an emphasis on industrial real estate in Central and NorthernNewJersey. The company also offers con- sulting and management services throughout New Jersey. ■
the start of 2012. How- ever, not all segments of the real es- tate market are picking up a t t he same pace. Fortunately
moving very slow. Unfortu- nately, there is an abundance of vacant and available space in all areas of New Jersey. Some sub-markets are better than others, but overall cor- porations are still not hiring and unemployment is still above 8%. Hence, there is no net absorption of corporate of- fice space and rentals are still
depressed and not rising. The retail real estate mar- ket is not much better. The large retail chains are not expanding and the smaller entrepreneurial chains are not starting new businesses. The retailers that are still in business are trying to survive and keep their heads above water. The last thing on their
Steve Bussel
the industrial market is accelerating at a much bet- ter pace than the rest of the commercial market, yet corporate office space is still
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Bussel Realty Corp. 2 Ethel Road, Suite 202 A, Edison, NJ 08817 (732) 287-3777 / Fax (732) 287-1090 / www.bussel.com The information herein has been obtained from sources deemed to be reliable, but no guarantee of its accuracy is made by the Company. In addition, no representation is made respecting measurements, dimensions, zoning, condition of title or any matters of a legal or environmental nature. Such matters should be referred to legal counsel for determination. Subject to errors, omissions or withdrawal without notice. For Additional Information or to Set Up an Inspection Contact EXCLUSIVE BROKER JORDAN METZ, Vice President Cell: (973) 493-0385 Email: jmetz3@mac.com For Additional Listings or Information Check Us Out On The Web: www.bussel.com
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