WCRE (Wolf Commercial Real Estate) reports that the South Jersey commercial real estate market exceeded several of its third quarter benchmarks, despite uncertainty caused by a natural disaster and other major news events. The latest quarterly analysis from WCRE, a premier South Jersey Commercial Real Estate Broker, found that while the third quarter was marked by caution, the fourth quarter market proved its resiliency.
“Though Hurricane Sandy, the election, and the threat of the temporarily-resolved fiscal cliff exerted pressure on businesses, investors, and consumers, there were signs of accelerated growth and reasons for optimism amid the overall climate of cautiousness,” said Jason Wolf, founder and principal of WCRE.
According to WCRE, the fourth quarter showed a significant uptick in both new deal activity and expansion in the market for Southern New Jersey medical space and other Southern New Jersey commercial properties. Several deals of significant size were completed, and South Jersey medical properties and other South Jersey commercial properties in prime locations performed better than the overall market vacancy rate. There were approximately 389,000 sf of notable Southern New Jersey commercial property deals executed in the market, a nearly 25% increase over the third quarter. This includes new lease and expansion transactions of approximately 235,000 sf. Notably, expansions and new deals for South Jersey medical space and other South Jersey commercial space outpaced lease renewals this quarter.
The report also noted that New Jersey’s unemployment rate improved to 9.6% – coming down from a 35-year-high notched during the previous quarter – and that there are many new South Jersey commercial real estate deals nearing completion. Other South Jersey commercial real estate market highlights from the report:
— Average rents for Class A & B product remained at the improved level they reached earlier this year, continuing to show strong support in the range of $11-$14.00/sf NNN with an overall market average of $11.00/sf NNN for the deals completed during the fourth quarter.
— New deals and expansion transactions of 235,000 sf for the fourth quarter was more than double the third quarter mark of 106,000 sf.
— Moorestown, Marlton and Mount Laurel (3M) continue to show strength, while a large share of the region’s vacancies remain in Voorhees, Pennsauken, and the west side of Cherry Hill. Burlington County continued to maintain a significantly lower vacancy rate than Camden County.
— Tenants continue to take advantage of low rental rates and are securing long-term lease commitments. The pattern of this flight to quality – upgrading to better locations and spaces – is expected to continue, especially among larger firms.
— All of the new major owners and REITS are showing a significant increase in deal activity and occupancy – both renewals and new deals – and are all cautiously optimistic.
Retail market highlights from the report include:
— Moorestown has issued its first ever liquor licenses, and PREIT acquired them in order to bring four new high-end restaurants to the Moorestown Mall.
— Overall South Jersey retail space vacancy is still hovering in the 17-18% range, but the market has stabilized, and prime retail locations have very little vacancy.
— Average rents for Class A retail product continue to show strong support in the range of $30-$40.00/sf NNN. Class B product shows support in the range of $15-$23/sf NNN.
— The Haddonfield Road corridor, Route 70, and Route 73 are the prime destinations for retailers.
The report also anticipated challenges in 2013, with at least 250,000 sf of additional Southern New Jersey medical office space and Southern New Jersey commercial space vacancies expected to return to the market as Lockheed-Martin, Catalent Pharma, and others follow through on plans to downsize. But Wolf said that even this development could be positive, because large blocks of quality South Jersey medical office space and other South Jersey commercial space in excess of 30,000 sf have become scarce.
The full report is available upon request.
For more information about South Jersey medical space for sale or South Jersey medical space for lease, please contact Jason Wolf (856-857-6301; jason.wolf@wolfcre.com), Leor Hemo (856-857-6302; leor.hemo@wolfcre.com) or Scott Seligman (856-857-6305; scott.seligman@wolfcre.com) at Wolf Commercial Real Estate, the premier Southern New Jersey and Philadelphia region Commercial Real Estate Brokerage and Advisory firm. As real estate brokerage and advisory experts in Southern New Jersey and the Philadelphia region, the team at our New Jersey commercial real estate brokerage firm provides ongoing detailed information to our clients and prospects to help them achieve their real estate goals.
Learn more about WCRE, a Southern New Jersey Commercial Real Estate Brokerage Firm, online at www.wolfcre.com, on Twitter @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at www.southjerseyofficespace.com<http://www.southjerseyofficespace.com/>, www.southjerseymedicalspace.com<https://southjerseymedicalspace.com/>, www.southjerseyland.com<http://www.southjerseyland.com/> and www.southjerseyretailspace.comhttp://www.southjerseyretailspace.com/.
WCRE markets Southern New Jersey and Philadelphia commercial offices, medical properties, industrial properties and retail buildings for buyers, tenants, investors and sellers in such areas as Marlton, Moorestown, Mount Laurel, Cherry Hill, Voorhees, and Pennsauken. Please visit our websites for listings of Southern New Jersey medical space for lease or purchase and other Southern New Jersey commercial real estate for lease or purchase or for information about medical space, retail space, office space or land for sale or lease from this Southern New Jersey Commercial Real Estate Broker.
