Sean Ryan is associate editor of Real Estate New Jersey, from which this article is excerpted.
(To read more on the industrial market, click here.)
WOODBRIDGE, NJ-A new Q3 report from Newmark Knight Frank on New Jersey's industrial space in the third quarter reflects a higher amount of space available for rent, thanks to new construction hitting the market. The availability rate statewide currently stands at 7.3%, with 6.9% direct and 0.4% through sublease.
The weighted average asking price is $5.81, with $5.84 being asked on average for direct space and $5.54 for sublease. Last quarter the average ask rate was $5.99, and last year it was $5.89. Net absorption was a negative 2.1 million sf.
Close to two million sf is under construction at the moment, with 600,000 sf rising in North Jersey (largely around Exits 12 and 13) and 1.36 million sf in Central Jersey (largely around exit 8A). Plans to make the Newark/Elizabeth port viable in the long-term has spurned construction of distribution centers with more doors and higher ceilings. These should command higher rents, around $8 per sf, which will raise the overall rental rates when delivered.
By county, Middlesex has the most space (180 million sf), and the most space on the market (13.7 million sf). Essex and Monmouth counties share the tightest market, with 4.1% vacancy each. Hunterdon County's 30.3% availability rate was a small aberration, Hunterdon having just under five million sf and 1.5 million sf of it available. Most other New Jersey counties had single digit vacancies, save Mercer with a 12.3% vacancy.
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