Real Estate Journal — Central New Jersey — May 13 - 26, 2016 — 7B
www.marejournal.com
M id A tlantic
C entral N ew J ersey By Greg Brown, NAI Dileo-Bram & Co. Non-institutional market stays hot
C
entral New Jersey has seen a significant in- crease in demand for
York City and a road network enabling quick access to the major population centers in the Northeast. When e-commerce consumers demand products in hours, not days or weeks, those e-retailers need to be close to the city. This has produced tremendous rent growth in Northern New Jersey and is now migrating south. Overall consumer spending increases the demand for warehouse space as well. There is a need to store and distribute all goods- not just the ones pur- chased on Amazon or Boxed. com. On the supply side, speculative
development has been slow to catch up to demand. This is normal in real estate cycles as real estate development reacts to demand - it does not predict it. This is particularly true of the non-institutional assets (those we will arbitrarily de- scribe as under 100,000 s/f for this article). The spec develop- ment that has occurred rang- es between several hundred thousand s/f up to one million s/f each, and is specifically targeting large distribution clients, principally e-retailers. There has been negligible spec development in all of New Jer- sey targeting small to mid-size
tenants. Owner/User competition. Unlike institutional level own- ers, investors of smaller sized properties have to compete with the tenants themselves. Long standing small to mid- size businesses who under- stand their long term space needs, are taking advantage of the low interest rate environ- ment for owner occupied prop- erties and are looking to create value in owning their real estate. Typically buyers look- ing to purchase real estate for their own account (as opposed to pure investors) can pay higher prices for property. As
long as interest rates remain low, this will continue. Inves- tors in the institutional sized asset class are not as likely to compete with business owners looking to buy real estate for their own use. In summary, demand is high, debt is cheap and we believe we are at or near the peak of this cycle. Owners of industrial real estate in New Jersey should seriously evaluate their positions and consider selling and taking advantage of this market. Greg Brown is Manag- ing Director at NAI Dileo- Bram & Co. n
i n d u s t r i a l assets under 100,000 s/f. Coming out of the last e c o n o m i c r e c e s s i o n , i n d u s t r i a l real estate values have
Greg Brown
returned to pre-recession val- ues or even exceeded them. Industrial real estate, particu- larly the well located assets in New Jersey, are some of the most sought after real estate in today’s market. Let’s cover 2 reasons why: Lack of inventory . When you talk about a lack of in- ventory, demand outpaces supply. The increase to the demand side has largely been driven by 2 factors- increases in consumer spending and specifically the increase in e-commerce. New Jersey has long benefited from its close proximity to major ports, New Marcus &Millichap completes sale of mixed-use building ELMWOOD PARK, NJ — Marcus & Millichap an- nounced the sale of 6,000 s/f mixed-use property located in Cranford, NJ for $2,258,800, according to Brian Hosey , regional manager of the firm’s New Jersey office. Marcus & Millichap had the listing to market the property on behalf of the seller, a private investor. Michael Lombardi , investment specialist of Mar- cus & Millichap’s New Jersey office, secured and represented the buyer, a private investor. The subject property is lo- cated at 13-15 North Union Ave. in Cranford, NJ. The three-story recently renovated property is made up of six two- bedroom apartments and one large commercial space on the ground floor. This property of- fers investors to own an asset in one of the most desirable areas in Union County. n 13-15 North Union Ave.
For Sale $2,600,000 – Ample Parking
Sold for $1,300,000.00 - $82 Psf
9,500 SF Building
18,000 SF Building
For Lease - 10,000 to 65,000 SF
20,846 SF Building
NAI DiLeo-Bram & Co. is a full-service commercial real estate firm in Central New Jersey since 1937. We currently manage and represent almost square feet of real estate in New Jersey. Whether you’re an owner, tenant, developer or investor with local or cross-market needs, call NAI DiLeo Bram & Co. Our clients receive custom solutions from a market leader with deep experience and relationships; and access to a world of NAI firms working in seamless partnership with a singular focus: .
1315 Stelton Road Piscataway, NJ 08854
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The information contained herein has been given to us by the owner of the property or other sources we deem reliable. We have no reason to doubt its accuracy, but we do not guarantee it. All information should be verified prior to purchase or lease.
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