Cushman & Wakefield released its 2016 recap late last week. The New Jersey industrial real estate market, overall enjoyed a successful calendar year, and experienced an all-time net absorption along with new leasing activity hitting a 16-year high.
“2016’s record leasing totals have been propelled by transactions over 300,000 square feet, as we’ve seen more than 16 such deals executed in New Jersey this year in warehouse facilities which is well above the annual average of 10 over the previous four years,” said Andrew Judd, Cushman & Wakefield’s New Jersey Market Leader. “Meanwhile, the tightening market has spurred new construction as developers have been bullish on the local warehouse market resulting in new construction reaching a recent high, only dwarfed by 2014 “
For the year, 14.9 MSF of space was absorbed throughout the New Jersey Industrial market, 76% of which was concentrated in Central NJ. Exit 8A (4.8 MSF), Lower 287 (3.3 MSF), and the Meadowlands (2.1 MSF) led the way in terms of net occupancy gains for the year,” added Jason Price, Cushman & Wakefield’s Research Director, Tri-State Suburbs.’s historic levels.”
In 2016, overall demand reached a high that hasn’t been seen since 2000 as the e-commerce boom has spurred expansion for logistics companies and last-mile delivery firms such as FedEx and UPS. During Q3, vacancy reached historically low levels and remained at that mark through the end of the year. Asking rents for warehouse space have trended higher since 2011 with a 15.5% increase since the close of 2015.