EAST RUTHERFORD, NJ—New Jersey industrial space continued to tighten in the first quarter, even as the construction pipeline reached historic levels — fueled in large part by tenant demand for e-commerce and last mile product — with the market expected to remain on its current trajectory over at least the next year, says Cushman & Wakefield.

“New construction deliveries for industrial space in Northern and Central New Jersey are anticipated to reach record levels this year,” says Andrew Judd, Cushman & Wakefield's New Jersey market leader. “Yet demand is so strong—and class A big-box options are so scarce in the Garden State—that much of the new product could already have tenants in place by the time they deliver. Barring any major geopolitical events, the New Jersey industrial sector is in line for another robust year.”

“Long term, land constraints will continue to limit future developments in most New Jersey submarkets,” says Jason Price, Cushman & Wakefield's research director, tri-state suburbs. “Vacancy should remain steady as a whole, while the rates in some key Turnpike submarkets should tick even lower. We should also expect additional rent growth in both class A and B product as this expansion cycle proceeds, with space in the primary submarkets likely to dwindle further.”