BAYONNE, NJ—The battle of America's two coasts is beginning to make some serious waves. For the first time since World War II, the East Coast surpassed the West in container traffic growth, according to a new report, "North American Port Analysis: Preparing for the First Post-Panamax Decade" from Colliers International.
Upon completion in 2015, the expansion of the Panama Canal will accommodate vessels capable of carrying up to 12,500 containers, will alter global trade routes, and is already promoting the advancement of the science of logistics. According to the report, Eastern ports saw traffic grow by 5.5% in the first quarter of 2012 over the same quarter in 2011, as compared with 3% in the western ports.
By 2015, Baltimore, New Jersey and Norfolk will all be ready to handle larger ships, bigger cranes and deeper channel depth—and Eastern traffic growth will accelerate further, says K.C. Conway, executive managing director of market analytics at Colliers and the author of the study.
"The East Coast is really stepping up," he says, noting that the remaining piece of the puzzle—New York—has fallen into place. On July 18, the Port Authority of New York & New Jersey expedited the $1-billion raising of the roadway of the Bayonne Bridge by six months and got placed on President Obama's list of projects for accelerated review.
The announcement came at an opportune time for the metropolitan region. The port of New York and New Jersey handles 30% of all goods shipped to the East Coast, and in 2011, it handled more cargo containers than its closest competitors—Savannah, Norfolk and Baltimore—combined. But now, the Bayonne Bridge will have enough clearance by fall 2015 to handle the larger volume.
As a result, industrial leasing is up in the Garden State. Nearly 2.7 million square feet of industrial space was absorbed along the New Jersey Turnpike Corridor during the second quarter, according to Jones Lang LaSalle's Q2 report. The strongest leasing activity was in the Meadowlands—454,000 square feet absorbed—and at Exit 8A, where 1.08 million square feet was absorbed from the market.
Northern New Jersey's industrial market leasing remained flat, except for the "blooming" activity in the Meadowlands, according to JLL's report. But areas right off the Turnpike in all parts of the state continued to perform says JLL managing director Rob Kossar.
"The Turnpike industrial corridor, being such an attractive location for tenants to conduct warehousing and distribution operations, predictably fared well as virtually every submarket—including the Port, Meadowlands, Exit 12, Exit 10, Exit 9, Exit 8A, Exit 7A and Exit 6 — experienced positive absorption" in Q2, Kossar says.
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