EAST RUTHERFORD, NJ-The first half of the year has boded well for New Jersey's industrial commercial real estate sector. Rents and occupancy levels continue to improve in the state, and there is even quite a bit of new development taking place, according to a Cushman & Wakefield report on the sector's first half of 2014.
Average industrial rents are now at $5.61 per square foot, up 8.3% from the same year-ago period. This is due largely because of larger tenants seeking big spaces, and "quality space continues to dwindle," remarks Kim Brennan, C&W's New Jersey market leader.
So far this year 5.8 million square feet of industrial space was absorbed in the state's 614.5-million-square-foot supply. This demand is leading to new construction.
Brennan and her team predict that three million square feet of industrial space will be constructed in New Jersey for the remainder of the year, including both spec and build to suit, bringing the total in 2014 to 8.5 million square feet, the highest total built in 13 years, according to the firm.
Underway right now include The Morris Cos.' 695,000-square-foot spec facility in Edison and Goya Foods' 628,000 distribution center in Jersey City. In the first half of the year, a one-million-square-foot Amazon.com facility was built, and 222,000 square feet was constructed for Falken Tire Corp., both in the Matrix Business Park, in Robinsville.
For the second quarter in a row new demand for industrial space exceeded six million square feet in New Jersey. For its part, C&W executed 13 leases totaling just over 100,000 square feet during the second quarter.
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