The recovery in the Southern N.J. office market continued with 121,000 square feet of demand growth pushing overall vacancy down 60 basis points to 17.1%. PHH Mortgage’s 60,000-square-foot lease at 10000 Midlantic accounted for half of this demand. This underscored a recent trend reversal where financial services firms suffered the greatest losses in this market during the downturn of 2008 and 2009. While this sector has yet to reclaim all the space it vacated during that time, it since has become the greatest contributor to this market’s recovery.
Key statistics for the Southern N.J. office market during the first quarter of 2013 are as follows:
• Vacancy Rate: 17.1%
• Absorption: 121,510 square feet
• Average Asking Rent: $20.98/SF full service
• Class A Asking Rent: $24.79/SF full service
Looking forward, while current pricing and availability levels preclude speculative development in the short term, a few larger requirements in the market should trigger build-to-suit projects as large blocks of space, especially in Class A product, become scarce. This would end a long development drought in a market that witnessed next to no construction activity since 2008, with the exception of new space at the mixed-use development known as Towne Place at Garden State Park in Cherry Hill.
To access the full Southern N.J. office report, visit /research. To speak with a NGKF local market expert, please contact Mira Matic at firstname.lastname@example.org.
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