Notable leasing transactions in these markets included Cory Furniture's 432,140-square-foot renewal at 666 Front St. in Elizabeth and Prologis' 192,829-square-foot lease at 1 Nixon Ln. in Edison, while the most notable sale was Black Rock's purchase of 583,379 square feet of space at 140 Docks Corner Rd. in South Brunswick.

Asking net lease rates in this quarter stood at $5.90 per square foot, which represented only a $0.26 decrease from the average asking rents posted a year ago, according to the report. In Northern New Jersey, the Route 46/23/3 Interchange submarket experienced the highest lease rate drop, down $0.84, while the Northeast Bergen submarket enjoyed significantly higher asking rent increases, up $1.39 per square foot. Additionally, asking rents in Central New Jersey stayed relatively stable, with the Trenton/295 submarket yielding the highest asking rate increase, up $0.18 per square foot, while the Brunswick/Exit 9A submarket decreased at the close of the first quarter, down $0.66.

"There is no denying that closing deals in today's industrial markets is more challenging then ever before, but we continue to see and advise our clients on the silver lining that we are witnessing during this unprecedented period of economic decline," senior vice president Mindy Lissner tells GlobeSt.com. "For example, there are new pricing benchmarks that have been set due to the continuous and precipitous decline in asking rents throughout the duration of 2008 and the beginning of 2009," she says. "As a result, many more markets are beginning to see longer periods of free rent and increasing tenant improvement dollars which will, in turn, result in lower net effective rents." Lissner adds that companies are beginning to take advantage of these opportunities by securing long-term leases at attractive rates, which will continue throughout 2009. If all goes well, this will lead to a decrease in vacancy rates as the market starts to return to equilibrium.