Different state, same problem: Office availbility soars in NJ

Supply outweighs demand as availability rate climbs to 22%

Tri-State /
Apr.April 16, 2021 07:30 AM
(Getty)

(Getty)

In New Jersey, office supply far outweighs demand for that space.

The Garden State’s office availability rate in the first quarter climbed to 21.6 percent, up 4 percentage points compared to the same time last year, according to a report from Avison Young New Jersey.

“Absorption continues to be negative for the third quarter in a row, a trend that reflects the tremendous effect the pandemic has had on the sector,” said Jeff Heller, the brokerage’s principal and managing director.

The jump in availability has driven prices down slightly, with office rents in the first quarter going for $29.38 per square foot, down $0.27 compared to a year ago.

Major transactions during the first quarter include Mallinckrodt Pharmaceuticals’ 102,000-square-foot sublease in the Perryville Corporate Park at 53 Frontage Road in Hampton. St. Joseph’s Medical added 80,000 square feet at 169 Minnisink Road in Totowa, making its total footprint at 140,000 square feet.

In the office investment sales arena, Liberty Properties, an Opal Holdings Group affiliate, acquired Mack-Cali Realty’s four-building Metropark complex in Edison and Iselin for $254 million. The 946,000-square-foot property consists of 99 and 101 Wood Avenue South and 333 and 343 Thornall Street, and is more than 90 percent leased, according to Mack-Cali.

The industrial sector had the opposite problem: shrinking vacancy. But warehouse vacancy rates appeared to have bottomed out in the first quarter at 2.5 percent, which is the same rate as a year ago, according to Avison Young.

After experiencing eight consecutive months of positive absorption, the rent for industrial properties in the first quarter rose to $10.03 per square foot, a 14.3 percent year-over-year jump.

Major industrial leases in the first quarter include Bob’s Discount Furniture’s 622,230-square-foot lease at 150 Old New Brunswick Road in Piscataway. In addition, Lincoln Equities Group announced UPS would lease 880,000 square feet at its planned industrial park at the former Military Ocean Terminal in Bayonne.





    Related Articles

    arrow_forward_ios
    Blackstone CEO Stephen Schwarzman and President Jonathan Gray (Getty)
    Blackstone reports “the most remarkable results in our history”
    Blackstone reports “the most remarkable results in our history”
    Panagram CEO John Kim, 65 East 55th Street and Quilvest Capital Partners' Frances Madrid (Getty, Google Maps, Quilvest)
    Park Avenue Tower snags two more financial tenants
    Park Avenue Tower snags two more financial tenants
    John Waldron, COO, Goldman Sachs (Getty Images, iStock/Photo Illustration by Steven Dilakian for The Real Deal)
    Goldman Sachs hints at return-to-office plans after Omicron delay
    Goldman Sachs hints at return-to-office plans after Omicron delay
    99 Washington Street in Manhattan NYC (TripAdvisor)
    Troubled FiDi Holiday Inn asking $187M
    Troubled FiDi Holiday Inn asking $187M
    “Nothing has changed”: Judges thwart evictions of nonpaying tenants
    “Nothing has changed”: Judges thwart evictions of nonpaying tenants
    “Nothing has changed”: Judges thwart evictions of nonpaying tenants
    Richard Wagman, managing partner, Madison Capital (Care/of, Madison Capital, iStock)
    Madison Capital signs wellness company in Brooklyn office
    Madison Capital signs wellness company in Brooklyn office
    Vornado co-head of real estate Glen Weiss and Sharebite President Mohsin Memon (VNO, Facebook, iStock)
    Vornado sweetening Manhattan office properties with food delivery partner
    Vornado sweetening Manhattan office properties with food delivery partner
    Thomas Cangemi, chief executive officer, New York Community Bank (New York Community Bank, iStock)
    Looming interest hikes prompt multifamily lending spree
    Looming interest hikes prompt multifamily lending spree
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...