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Industrial Demand Counters Consolidations

FAIRFIELD, NJ-Just over 182,800 square feet of negative net absorption occurred in the Northern and Central New Jersey industrial market during the first three months of 2010.

By Alyson Grala | Updated on April 27, 2010

FAIRFIELD, NJ-After posting an unprecedented 22.2 million square feet of negative net absorption during 2009 in response to surging availabilities unleashed by corporate consolidations in the Northern and Central New Jersey industrial market, an uptick in leasing requirements helped to counter these losses during the first quarter of 2010.

Just over 182,800 square feet of negative net absorption occurred in the 644-million-square-foot Northern and Central New Jersey industrial market during the first three months of 2010, according to a recent report from locally based Grubb & Ellis Co. This was in stark contrast to the same period one year ago, when more than eight million square feet of negative absorption was recorded, as many business sectors aggressively reduced their industrial real estate holdings in response to the economic downturn.

In fact, quarterly negative absorption figures have been trending lower during the past year. After recording more than eight million square feet of negative absorption during each of the first two quarters of 2009, 3.8 million square feet occurred in the third quarter, followed by less than 1.1 million square feet during the final three months of 2009. “The diminished volume of negative absorption could indicate that many industrial users have completed their restructurings, which is allowing the limited demand to absorb the current availabilities,” says the report’s author Stephen Jenco.

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