PARSIPPANY, NJ—Leasing activity in the Northern and Central New Jersey office market was robust in the first quarter of 2015, driven by tenant renewals and relocations across submarket borders for Class-A space. However, some of the positive momentum in leasing activity was counterbalanced by the availability rate, which remained flat, with several large sale-leasebacks and corporate consolidations, according to new research from Colliers International.

“There's a lot of value-add plays going on now, there's a lot of investment money flowing into assets that are well-located, and these investors are repositioning the properties, either for office space or totally redeveloping the property for different uses, it could be industrial, retail, or mixed use,” John Obeid, Colliers' senior director, research, tells GlobeSt.com exclusively.

Major acquisitions this quarter included:

• CBRE Global Investors' purchase of 250 Pehle Avenue in Saddle Brook from L&L Holding Company and Pearlmark for $75 million, or $147.75/square foot.
• Extended Success' purchase of 400 Plaza Drive in Secaucus from Hartz Mountain Industries for $30 million, or $116.07/square foot.
• Intercontinental Real Estate Corporation's purchase, in a joint venture with Ivy Realty, of Morris Corporate Center IV in Parsippany from MetLife Real Estate Investments for $29.25 million, or $84.73/square foot.

“A good example is 400 Plaza Drive recently sold this quarter, and it's a value-add play, the investor is going to put money in, reposition the property. Another good story in Parsippany is 1515 Route 10. That property sold for about $49 a square foot, which is good news.” A property across Route 10 sold several years ago for $26 a square foot, Obeid says, adding that “investors are starting to see some value in these properties.”