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Smaller Deals Dominate Q1 Office Transactions

SADDLE BROOK, NJ-Lease renewals and smaller deals dominated New Jersey's Northern and Central office markets in the first quarter of 2009, according to a recently released CBRE report.

By Alyson Grala | Updated on May 04, 2009

SADDLE BROOK, NJ-Due to the unstable economic climate and a year defined by negative market conditions, New Jersey’s Northern and Central Q1 office transactions were largely lease renewals and smaller deals, according to CB Richard Ellis’ First Quarter 2009 New Jersey Office MarketView report. According to the report’s findings, leasing velocity continued to decline, asking rents slipped and availability rates increased, as lease renewal activity continued to be a saving grace, adding an additional 24% to the state’s total leasing activity. The average deal size topped out at 11,000 square feet, with 65% of first quarter deals falling below 10,000 square feet.

“As was to be expected, economic instability continued into the first quarter of 2009, further impacting the Northern and Central New Jersey office markets, which continue to struggle through the economic downturn,” says Jeffrey Hipschman, senior managing director, CBRE. However, he tells GlobeSt.com, “We are still seeing significant windows of opportunity for both tenants and owners alike, particularly in Montvale/Woodcliff Lake, Meadowlands and Suburban Essex/Eastern Morris submarkets, which experienced the largest amount of leasing activity in the first quarter. Overall, we remain confident in the relative strength of New Jersey’s office markets.”

Market fundamentals in the Northern and Central New Jersey office market for the first quarter of 2009 kept pace with national trends, closing with a 402,000-square-foot decrease in leasing velocity from last quarter, totaling 1.06 million square feet for the quarter, with the largest amount of activity found in the Montvale/Woodcliff Lake Market–160,000 square feet; Meadowlands–150,000 square feet; and Suburban Essex/Eastern Morris–150,000 square feet.

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