"As long as Manhattan remains the region's employment powerhouse, its rents are going to grow," agrees Brian Whitmer of Cushman & Wakefield's Metropolitan Area Capital Markets Group. "That means people will either be displaced or choose to live in New Jersey based on its value proposition. That has traditionally been true, it's true now and it's trending into the future."

Garden State rents can climb like Spiderman—and on the Gold Coast, there are reports of it—but they will never catch up to Manhattan's rate scale. Jose R. Cruz, senior managing director of HFF, said his company recently underwrote a property in Central Jersey where rents had increased three times since January. When the construction pipeline does start spewing thousands more new units, Cruz says it could have temporary negative effects on rates in areas where development is concentrated. But he, Whitmer, Barry and others describe that as part of an ordinary real estate cycle and eschew the idea of a rental glut pushing rates back down.

Right now, the epicenter for new development is Jersey City. Unlike Hoboken, the development and trendiness capital of the Gold Coast for the past decade, Jersey City has significant land mass—14.9 square miles—and large available sites. Milesquare Hoboken is now so built-up that even the city's famous native "Cake Boss," reality-TV star Buddy Valastro, decided he had to bust across the border to Jersey City when expanding his operations.

Earlier this year, Valastro moved his bakery (save for the tiny original shop in Hoboken), his distribution center, classrooms and TV studio into rehabbed space in an old warehouse, situated amidst acres of mostly empty post-industrial property north of the Holland Tunnel. Developer Sandford Weiss' Manhattan Building Co. then launched a pioneering effort aimed at transforming the area into a residential neighborhood; MBC is building the 155-unit Cast Iron Lofts on the same block as the pastry king's new digs. The 20-story loft building, expected to open early next year, offers panoramic views of the river and Manhattan skyline, Statue of Liberty, Palisades Cliffs and nearby rail and lightrail lines (with shuttle service to be offered to the stations while the pioneering phase is still on).

At Jersey City's original pioneering complex, the enormous Newport Center, which the Lefrak Organization began conjuring out of old railyards back in 1986, the 13th residential building will open next year. The Laguna, a 150-unit tower, is under construction now. Jamie LeFrak's public plea to the office market to cough up a big tenant so the company can start a new pier and office project has not yet produced any takers. But residential tenants? "The market just couldn't be hotter," says LeFrak.

In Paulus Hook, one of Jersey City's most historic and seemingly full-to-thebrim neighborhoods, The Madox, a new green, no-smoking-allowed building will open in October. Built on a onetime factory site that took five years to clean up, the Madox is a project that was originally conceived as a condo by Hoboken-based Fields Development Group. The 131-unit rental is designed to win LEED Silver status from the US Green Building Council; it has a PV solar array and vegetation on the roof, electric-car charging stations, systems to reduce water and energy consumption and a contract to buy energy from renewable sources.

The Barrys' company, Ironstate, opened 225 Grand, a 348-unit building in Downtown Jersey City last year (in addition to opening 275 upscale apartments in post-industrial Harrison, both with construction partners). The 225 Grand apartments were fully leased within 10 months, as Downtown Jersey City seemed to roar back to life only a heartbeat after Downtown Manhattan. In June, Ironstate broke ground on 18 Park, a 422-unit tower, a few blocks from its 225 Grand.

Two more Jersey City projects are on Ironstate's docket. In early 2013, work begins on 80 Columbus, a 550-unit tower to rise next to the Grove Street PATH station. The partner is Panepinto Properties, which also joined in building 50 Columbus, a 400-unit rental, in 2008. And later next year, work is supposed to start on a parking pedestal to support an iconic 69-story tower with 766 apartments in a joint venture at Mack-Cali's Harborside complex.

Mack-Cali's announcement that it will participate in a joint venture to create a sky-scraper apartment tower at its office/ retail complex came in December of last year, and was followed in a matter of days by Hartz Mountain Industries breaking ground in Weehawken on a joint venture with Roseland Property Co. Mack-Cali had not touched the residential arena in more than a decade before announcing the portfolio shift, which CEO Mitchell E. Hersh explained by observing that the state's office market expansion possibilities are currently "somewhat limited." Indeed, the statewide office vacancy rate has been stuck at over 20% for almost three years (although in Jersey City it is lower, about 10%).

Hartz Mountain, based in Secaucus, has also concentrated on office development for decades, and lately made a shift. Right now, it is joined with Roseland in putting up the 589-unit first building at the Estuary in Weehawken, which is planned as a three-building complex. The riverfront site for the Estuary is just north of the Port Imperial complex, on property that Hartz has owned for more than 30 years, always planning to develop it for offices.

At Port Imperial, Roseland is also under way on RiverTrace, a 316-unit luxury rental within the boundaries of West New York. The two-mile-long Port Imperial complex is master planned as a constantly growing mix of for-sale and rental units. A couple of years passed without any condos opening, though, and none in the works until Lennar Urban announced it would break ground in mid-August on the first 74-unit building in its planned "Avenue Collection." The seven-story structure is to be the first of five situated right beside the Hudson with super-luxurious amenities, including a third-floor outdoor "grand plaza."

Roseland's year-old 540-unit Monaco Towers in Jersey City were originally supposed to be super-luxurious condos as well but switched to rentals just before ground was broken in 2010. Monaco set records with its rents when it opened: $2,500 for a studio, and up to $7,500 a month for a three-bedroom penthouse. The units nevertheless rented quickly, starting out at a pace of nearly 100 a month and achieving over 90% occupancy by last spring.

Off the waterfront, the pace is not nearly as go-go-go for development, period. But multifamily rentals are still the dominant form.

In New Brunswick, where a public-private partnership managed to cobble together $150 million in financing during the recession—as nonprofit developer Christopher J. Paladino puts it—a 20-story mixed-use tower with 150 rental units was completed in March. The Vue is part of the Gateway Transit Village project around the New Brunswick train station, and near medical/research facilities and the Rutgers University campus being orchestrated by DEVCO, of which Paladino is president. The Vue apartments were offered at top rents for the area—$1,700 to almost $2,700 a month. After five months, only 37 units were still available.

"The need and the desire for quality rental housing are there," Paladino says. "There's no question about that, certainly not when you have a built-in market as we do here in New Brunswick."

With construction financing generally available again, projects are rising in more various and outlying venues. On a hill overlooking Exit 148 of the Garden State Parkway, Prism Capital Partners is bulldozing its way through a gut rehab of a landmark warehouse. Prism bought the former General Electric Co. building five years ago, just before the economy stalled, with a plan to convert it for "underserved middle-market" renters (originally, the plan was for condos here, too).

The building is within walking distance of a commuter rail station in Bloomfield, and Prism pitched it to be transit-related housing. This summer, the company was finally able to drive forward with its plan, bringing in bulldozers to knock out bottom floors and begin reconstruction work to fashion 365 apartments inside the hulking structure.

The building will open early next year, and now the delayed timing has actually turned out to be propitious, says Eugene R. Diaz, a principal partner at Prism. "There are so many young people living at home now, because they can't afford to establish their own households in this market, that there's a huge pent-up demand for rentals in locations near transit at workforce prices," he observes.

Certainly, the starter-home option still exists and remains viable for many home seekers. The for-sale housing market shows improvement in New Jersey as it does in the nation, although the Garden State lags behind national trends toward higher prices in the past six months. More lowpriced foreclosure properties are hitting the market since the lifting of an 18-month moratorium following the mortgage robosigning scandal. In Bergen County, foreclosure properties are really spurting: courts processed more than twice as many foreclosures there in the first six months of this year than last year. And some builders have re-commenced putting up townhouse condos, although condo construction had virtually ceased for a couple of years

"Still, a lot of people just cannot—or don't want to—put together the 2% down payment lenders demand today," notes Diaz. He thinks comparative economics for young home-seekers generally run in favor of rentals, and he draws a direct, if highly subjective, comparison between what will be available at his project versus the town houses competitor Pulte Homes is building and selling right now in Garfield.

"For about $2,100 a month at our building—comparable to the mortgage for one of those condos—you will get a two-bedroom, 1,180-square-foot unit with polished concrete floors, 17-foot ceilings, granite counters and stainless steel appliances, garage parking, a built-in gym, health club, gated security entrance, rooftop views of Manhattan, a two-minute walk from the train—and keep the 30-grand for a down payment in your pocket," says Diaz. "A lot of people are going to like the deal."

Also, as New Jersey's prominent market analyst Jeffrey G. Otteau has been asserting for years now in monthly reports to the industry, Diaz notes that a "lifestyle shift is on," swelling the ranks of rentersby-choice who want more urban surroundings. "That's one of the main reasons for the flocking to Hoboken/Jersey," Diaz observes, "but not everyone in the world wants to live in Hoboken/Jersey City, or can afford to."

The rippling outward of demand from Manhattan to the Gold Coast to innerring suburbs and beyond will continue and spread out, according to Otteau and other market analysts. This year, some communities will already be getting their first modern apartment communities ever. In Elmwood Park, Riverfront Residential is nearing completion of the first 91-unit building at Riverwalk, a large rental complex with ground-floor retail space. In Monmouth County's Howell, Sterling Properties is at work on Verdana Howell, a community of 220 oneand two-bedroom garden apartments with clubhouse, pool, tennis court and tot lot.

"Here it comes, the new wave," says Diaz, "and the market is saying: Bring it on."