www.marej.com M id A tlantic Real Estate Journal — Southern New Jersey — October 21 - November 17, 2022 — 7B S outhern NJ Potentially difficult obstacles on the horizon, though silver linings remain Third Qtr. 2022 Report: Southern NJ & Philly Markets rebound slightly, but face new challenges
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The full report is available upon request. 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
and news from Philadelphia and the suburbs. Highlights from the second quarter in Pennsylvania include: • Philadelphia’s office leas - ing market has improved vast- ly since the worst days of the pandemic, but it is still averag- ing 15% below the three-year average before the pandemic. Net absorption was negative 1,000,000 s/f for the past 12 months, as several sizeable of- fice tenants shift to permanent remote or hybrid work. • The industrial sector in Philadelphia continues its incredible run. Over the past
12 months, 14.3 million new s/f of inventory became avail- able, and the sector saw 10.1 million s/f in net absorption. Rents grew an average 10.8%. • Retail remains the sector most responsive to market con- ditions, but it has also proved to be the most adaptable. Average retail net absorption in Philadelphia continues to improve and was at 2.2 million s/f for the 12 months just con- cluded. Average rents dropped half a percentage point. WCRE also reports on the Southern New Jersey retail market. Retail highlights from
the report include: • Retail vacancy in Cam - den County posted another improvement, to 8.2 percent, while average rents jumped to the range of $16.98/sf NNN. • Burlington County retail vacancy improved more than 1.5 points, to 6.8 percent, while average rents inched down, to the range of $14.32/sf NNN. • Gloucester County im - proved slightly, to 10.7%, build- ing on a solid improvement last year, with average rents increasing by more than a dol- lar psf, to the range of $17.59/ sf NNN.
ARLTON, NJ – Com- mercial real estate brokerage WCRE
reported in its analysis of the third quarter that issues in the broader e c o n o m y have caused a slowdown in CRE, but
Jason Wolf
pockets of strength persist. Stubbornly high inflation, ris- ing interest rates, and fear of a recession are among the head- winds that played havoc on the markets in the third quarter. “Economic uncertainty and rising borrowing costs, among other issues, have led to some reshuffling in terms of where the CRE strengths are,” said Jason Wolf , founder and managing principal of WCRE. “There are still bright spots, and in the third quarter those were driven by retail, a flight to quality among suburban office tenants, and the life sciences/ healthcare category.” In the third quarter there were approximately 294,246 s/f of new leases and renewals executed in the three counties surveyed (Burlington, Cam- den and Gloucester). This is a small decrease from Q2, which in turn was well below Q1. New tenant leases comprised approximately 197,906 s/f, or about 67.3% of all deals for the three counties. Other office market high- lights from the report: • Overall vacancy in the mar - ket is now approximately 15.65 percent, essentially unchanged from the previous quarter. • The sales market-main - tained momentum, with 1,367,763 s/f actively on the market or under agreement. • Both the total dollars and s/f of completed sales dropped again in the third quarter, with $38,705,000 in completed sales comprising 369,753 s/f. • 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 quarter. These averages have hovered near this range for more than a year. WCRE has expanded into southeastern Pennsylvania, and the firm's quarterly reports now include a sec- tion on transactions, rates,
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