EAST RUTHERFORD, NJ—The Northern and Central New Jersey office market experienced a slowdown in overall leasing activity in the third quarter due to a lack of signed leases of 100,000 square feet or greater, while vacancy rates remained stable despite a handful of large spaces coming online, according to Cushman & Wakefield. More office buildings also are slated to be repurposed into apartments, retail, and/or hotels, helping to keep vacancy at bay, as several owners have announced plans to redevelop suburban office properties in a handful of submarkets.

“The New Jersey office market may not revert back to the historic levels of 2015 and 2016 in terms of absorption and demand, but occupancy is anticipated to remain relatively stable going forward as many of the large dispositions are now in the rear-view mirror,” says Andrew Judd, Cushman & Wakefield's New Jersey market leader. “Potential redevelopments of other obsolete or outdated office product will help the market's vacancy rate from swelling once again, as we should see demand pick up in some of the key market segments. Overall leasing is expected to improve during the final months of the year.”

Quarterly overall net absorption finished in the red for the third quarter due to some big blocks of space coming online in the I-78 Corridor, Hudson Waterfront, and Parsippany, says Jason Price, Cushman & Wakefield's research director, Tri-State Suburbs.