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NEWS RELEASE
Cushman & Wakefield of New Jersey, Inc.
One Meadowlands Plaza
East Rutherford, New Jersey 07073
Media Contact:
Evelyn Weiss Francisco: [email protected], (201) 796-7788
www.twitter.com/carylcomm
Cushman & Wakefield Reports Healthy Quarter for New Jersey Office
Brisk Demand Driving Positive Absorption and Pushing Down Vacancies
EAST RUTHERFORD, N.J., Oct. 1, 2015 – Commercial real estate services firm
Cushman & Wakefield reported another healthy quarter for the New Jersey office sector
today with the release of its third quarter 2015 market data.
“Tenant demand remains brisk, and our region posted its third straight quarter of
positive absorption as the vacancy ticked downward to 19.0 percent – its lowest mark in
three years,” noted Cushman & Wakefield’s Jason Price, research director, tri-state
suburbs. “However, market fundamentals varied by submarket. Some set near recordbreaking leasing totals while others experienced lulls in demand coupled by notable
space sheds.”
New leasing activity has exceeded 2.0 million square feet per quarter to date this year,
bringing the Northern and Central New Jersey office leasing total to 8.5 million square
feet. This represents a 37.0 percent increase over last year at this time.
“Barring a significant slowdown in demand, the Garden State office market should
accrue its highest annual total of deal volume since 2006,” Price said. “The trend of
flight to quality continued in recent months, with 74 percent of third-quarter leasing
concentrated in class A buildings.”
Pharma and financial services fueled third quarter demand, led by large transactions
involving Valeant Pharmaceuticals (310,000 square feet in Bridgewater), JPMorgan
Chase (380,000 square feet in Jersey City) and Zoetis Services (126,000 square feet in
Parsippany). In total, tenants inked eight transactions in excess of 50,000 during the
quarter, almost all of which were concentrated in Parsippany, the I-78 Corridor or the
Hudson Waterfront.
“All three submarkets are on pace to finish the year coming close to or exceeding recent
historical highs,” Price said. “Conversely, areas that have seen brisk leasing in recent
quarters – such as Woodbridge/Edison, Princeton/Route 1, and the Meadowlands –
experienced a slowdown in transactional volume during the past three months.”
Price noted that office renewal activity also remained robust in the Northern and Central
more-
counties, with substantial third-quarter renewals by tenants such as Fidelity, Novo
Nordisk, AT&T, Riker Danzig and MedAssets. In total, nine firms occupying in excess of
50,000 square feet opted to extend their current leases.
The office vacancy rate in Northern New Jersey edged marginally higher during the past
three months, to 20.5 percent, as large blocks of space came online in Newark and the
Meadowlands. Central New Jersey, driven by the I-78 Corridor’s strong leasing
performance, saw its vacancy rate fall 0.7 percentage points to 16.9 percent. Similarly,
occupancy gains edged slightly negative in Northern New Jersey while positive Central
New Jersey saw positive gains. Year-to-date absorption for the combined regions
reached 1.5 million square feet.
Asking rents continue to experience minimal fluctuation in the New Jersey office market,
with the average rate remaining flat year over year at $26.31 per square foot. However,
as class A space continues to get leased up in areas such as the Hudson Waterfront, I78 Corridor, Morris County and Metropark, the average class A rate has edged lower in
recent quarters. Conversely, class B rents have risen marginally as that market has
tightened.
“Despite some challenges, including some older building stock with large vacant blocks,
the New Jersey office market should continue to modestly improve over the next few
quarters as both the national and state economies trend upward,” Price concluded.
“Demand should remain healthy into the near future, while most of the substantial
dispositions are in the rear view mirror for the time being. Meanwhile, some landlords
will opt to renovate and upgrade their assets to remain competitive, which should lead
to asking rents edging higher in the more prominent submarkets.”
The successful merger of Cushman & Wakefield and DTZ closed September 1, 2015.
The firm now operates under the iconic Cushman & Wakefield brand and has a new
visual identity and logo that position the firm for the future and reflect its trusted global
legacy and wider history. The new Cushman & Wakefield is led by Chairman & Chief
Executive Officer Brett White and Global President Tod Lickerman. The company is
majority owned by an investor group led by TPG, PAG, and OTPP.
About Cushman & Wakefield
Cushman & Wakefield is a leading global real estate services firm that helps clients
transform the way people work, shop and live. The firm’s 43,000 employees in more
than 60 countries provide deep local and global insights that create significant value for
occupiers and investors around the world. Cushman & Wakefield is among the largest
commercial real estate services firms with revenues of $5 billion across core services of
agency leasing, asset services, capital markets, facility services (branded C&W
Services), global occupier services, investment & asset management (branded DTZ
Investors), project & development services, tenant representation and valuation &
advisory. To learn more, visit www.cushmanwakefield.com or follow @CushWake on
Twitter.