The same market conditions that are pushing rents higher and vacancy rates lower for rental units throughout America are spurring multi-family construction in New Jersey. According to the Wall Street Journal, rental apartment construction is expected to more than double this year from the fewer than 1,300 apartments built in 2011. It would mark the most new units since 2007.
Roseland Property, Ironstate Development and BNE Real Estate together are responsible for more than 1,500 of the new apartments.
“Now we are near historical rent highs and vacancy lows — that usually means it’s time to build,” said Brian Whitmer of brokerage firm Cushman & Wakefield. “All the towns along the waterfront have construction going on.”
But lenders are confident enough in the market that the building isn’t limited to the parts of northern New Jersey that border New York City; in fact, about one-third of the new apartments will arise in central New Jersey. According to Marcus & Millichap the median rent statewide will grow 4 percent this year to $1,322 per month.
One more reason for the growth is the state’s Urban Transit Hub Tax Credit, which has already allocated $250 million towards developments near transit stations. [WSJ]