The northern portion of the state, covering routes 4, 10, 17 22, 23 and 46/3 and several intersecting arteries in Bergen, Passaic, Morris, Essex, Union and Somerset Counties, saw vacancy increase to the highest rate in 10 years 8.1%, versus 8% in 2010, the survey reports. Also rising to a 10-year high was the central region’s vacancy rate, hitting 10.5% compared with 9.8% in 2010. Included in that figure are Middlesex, Monmouth, Mercer and portion of Ocean counties.

In addition to A&P closing 10 Pathmark stores, the bankruptcies of Blockbuster Video and Borders Group also affected rates to some degree, the company says. Blockbuster has closed 18 stores to date, with Borders closing one. “Generally speaking, as evidenced by some of the big box absorption we saw over the past year for former Circuit City, Linens ‘n Things and even Comp USA spaces that had lingered on the market, demand is picking up somewhat for well-located A and B properties,” Brunelli says.

Restaurants such as Brick House Tavern, Buffalo Wild Wings, Joe’s Crab Shack, Texas Roadhouse, Zin Burger, Muscle Maker Grill and Red Robin continue to expand, as do fitness centers including fitness centers such as Workout World.

The vacant space eventually will be absorbed, Brunelli says. “There’s clearly a great deal of inventory out there,” he says. “But with New Jersey’s dense population and high household income, the northern and central markets remain high on the radar screen of expansion-minded retail and restaurant chains. Against that background, we expect most prime spaces will be absorbed, causing vacancy rates to tighten in 2012-13 and rents to begin creeping upward.”