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Tag Archives: industrial


A Snapshot of An Unprecedented Industrial Market in Southern New Jersey

Navigating the New Jersey industrial market since the COVID Pandemic in 2020 has created an ultra-competitive and fierce landscape for users and investors alike. Building owners hold all of the cards and the sprint to obtain functional, well-located warehouse space is becoming more and more challenging. We are seeing this extraordinary demand priced in to current rents proposed to tenants, building purchases and land purchases for new development.  Never in this market’s history have we experienced the current conditions; vacancies below 1%, rents increasing 5-15% month-over-month, and record high sales prices for existing buildings and land. 

There are now new complications on the horizon that are affecting forecasting and underwriting, offering little protection to manage risk. Construction costs have been on the rise driven by booming demand for warehouse space as a result of dramatic increases in ecommerce. Further, labor and materials costs are rising and unpredictable, two of the biggest variables affecting development costs, making the final cost and delivery dates of these projects virtually impossible to predict. Supply chain constraints have also made material costs and lead times unpredictable, the biggest variables for delivering a functional, end product for users on time for occupancy. Many components of these facilities, including ESFR Sprinkler systems, racking infrastructure, concrete, steel and other building materials, have lead times varying between 6-18 months. This challenge costs time, as materials necessary to move a project forward aren’t readily available when needed.  Before the pandemic, developers could predict with precision when materials would be delivered to a site.

Labor availability is another real issue compounding the problem.  Further General Contractors (GC’s) and construction professionals choose projects that offer scale, in order to maximize their time and profit margins. This condition has created challenges for developers hiring and selecting GC’s as they no longer have leverage. GC’s are routinely bidding high, so that if they win a project, they are padding their profits. Yet another variable that may add additional stress to the supply chain and demand for construction materials are projects funded by the recently passed infrastructure bill.  States are anxious to begin shovel ready projects, including road and bridge repair.  Mass transit agencies such as Amtrak and Septa are also getting much needed funding to improve their infrastructure and service.  How this impacts prices of steel, concrete and other materials is not yet known but it will put upward pressure on labor availability. 

Additionally, ecommerce and last mile distribution is driving end user demand, which has resulted in a flood of institutional capital into the sector, which is bullish on new development and leased facilities. Identifying development sites has become increasingly challenging, forcing developers to think outside the box. This includes knocking down office buildings and similar underutilized buildings on larger sites well suited for warehouse and industrial development.  Never before has highest and best use analysis manifested itself into warehouse and industrial conversions.  Many of these sites however, require zoning changes, which is yet another difficult variable affecting this segment of the market.  Many township and communities are resistant to further development due to truck traffic and strains on their ability to provide utilities and services.  We are seeing this exact scenario occur in the Lehigh Valley where a portion of the community and elected officials want to prevent additional warehouse distribution development.

 Favorably-zoned land however is sometimes found in well-located, in-fill townships with obsolete or vacant office.  Given the reduced demand for old and obsolete office product has made demolishing office space feasible, offering benefits to townships receptive to the new development, such as improving the tax base and the creation of new jobs.  Reducing the inventory of obsolete commodity type office product, which is fairly prevalent in South Jersey.  We are truly in unchartered waters with little relief in sight.  Many experts contend these market conditions are unsustainable, but how long these market conditions can continue is extremely difficult to predict.

Article provided by Sean Kelly, Vice President of Wolf Commercial Real Estate. For more information regarding South Jersey and Philadelphia Market Industrial Trends, or to talk to Sean about industrial commercial real estate listings, contact him at sean.kelly@wolfcre.com. 

Wolf Commercial Real Estate, a full-service CORFAC International brokerage, and advisory firm, is a premier New Jersey and Philadelphia commercial real estate brokerage firm that provides a full range of New Jersey and Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other New Jersey and Philadelphia commercial properties for buyers, tenants, investors, and sellers.

A New Jersey and Philadelphia commercial real estate broker with expertise in New Jersey and Philadelphia commercial real estate listings, Wolf Commercial Real Estate provides unparalleled expertise in matching companies and individuals seeking new New Jersey and Philadelphia office space, New Jersey and Philadelphia retail space, or New Jersey and Philadelphia industrial space with the New Jersey and Philadelphia commercial properties that best meets their needs.

As experts in both Philadelphia and New Jersey commercial real estate listings and services, the team at our commercial real estate brokerage firm provides ongoing detailed information about Philadelphia and New Jersey commercial properties to our clients and prospects to help them achieve their real estate goals.  

Please visit our websites for a full listing of South Jersey, Philadelphia, and New Jersey commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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New Jersey Readies Warehouse Development Guidance As ‘Sprawl’ Concerns Spread Nationally

New Jersey is drafting guidelines to help its more than 500 municipalities make decisions about the development of warehouses within their borders, as localities across the country grapple with a surge of projects that have sparked criticism for an increase in traffic, pollution and loss of open space. 

The New Jersey Planning Commission is in the process of internally reviewing the proposed guidance it’s been developing, a document that would offer information that local officials could voluntarily turn to when a developer seeks to build a distribution or logistics facility within their borders. 

The guidelines are being formulated roughly a year after a criticized bill that would have put dramatic controls on warehouse development in New Jersey was introduced in the Legislature. The measure, strongly opposed by the state’s commercial real estate industry and business groups, never got “across the finish line,” according to one of its co-sponsors, Democratic state Sen. Shirley Turner.

*Article courtesy of Costar

For more information about New Jersey or Philadelphia health care space, industrial space, retail space, office space, land or other New Jersey and Philadelphia commercial properties, please call 856-857-6300 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading New Jersey and Philadelphia commercial real estate broker that specializes in both New Jersey and Philadelphia cannabis, healthcare space, office space, retail space, land and New Jersey and Philadelphia industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage, and advisory firm, is a premier New Jersey and Philadelphia commercial real estate brokerage firm that provides a full range of New Jersey and Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other New Jersey and Philadelphia commercial properties for buyers, tenants, investors, and sellers.

A New Jersey and Philadelphia commercial real estate broker with expertise in New Jersey and Philadelphia commercial real estate listings, Wolf Commercial Real Estate provides unparalleled expertise in matching companies and individuals seeking new New Jersey and Philadelphia office space, New Jersey and Philadelphia retail space, or New Jersey and Philadelphia industrial space with the New Jersey and Philadelphia commercial properties that best meets their needs.

As experts in both Philadelphia and New Jersey commercial real estate listings and services, the team at our commercial real estate brokerage firm provides ongoing detailed information about Philadelphia and New Jersey commercial properties to our clients and prospects to help them achieve their real estate goals.  

Please visit our websites for a full listing of South Jersey, Philadelphia, and New Jersey commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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WCRE FIRST QUARTER 2022 REPORT

After a Pause, Southern New Jersey & Philly Markets Appear to have Overcome Omicron

Commercial real estate brokerage WCRE reported in its analysis of the first quarter that the post-pandemic recovery is back on track.

WCRE FIRST QUARTER 2022 REPORTNow that the highly transmissible Omicron variant of COVID-19 is finally declining, there has been a rapid expansion of economic activity that has had positive impacts on many CRE sectors.

Download Printable Report (PDF) >>>

“What a difference one quarter can make. Just a few months ago, the Omicron variant was dampening demand, increasing vacancy, and generally creating uncertainty. Now, we’re seeing a CRE market that is much improved on many indicators, and continuing to strengthen.” said Jason Wolf, founder and managing principal of WCRE. “Employment, retail sales, and industrial production all expanded throughout Q1, and CRE is in a strong position as a result.”

In the first quarter there were approximately 479,886 square feet of new leases and renewals executed in the three counties surveyed (Burlington, Camden and Gloucester). New tenant leases comprised approximately 296,152 square feet, or about 62% of all deals for the three counties. These totals represent more than 50 percent improvements over the fourth quarter of 2021, which itself had improved significantly over the third quarter.

Other office market highlights from the report:

• Overall vacancy in the market is now approximately 12.15 percent, a significant improvement over the previous quarter. 
• The sales market maintained momentum, with 1,167,321 square feet actively on the market or under agreement.
• Both the total dollars and square feet of completed sales were more than double the totals for the fourth quarter, with $78,365,469 in completed sales comprising 956,596 square feet.
• Average rents for Class A & B product remain unchanged, as they continue to show strong support in the range of $10.00-$15.00/sf NNN or $20.00-$25.00/sf gross for the deals completed during the quarter. These averages have hovered near this range for more than a year.

WCRE has expanded into southeastern Pennsylvania, and the firm’s quarterly reports now include a section on transactions, rates, and news from Philadelphia and the suburbs. Highlights from the first quarter in Pennsylvania include:

• Vacancy in Philadelphia’s office leasing market is still 20% below the three-year average before the pandemic. There were modest gains in 2021, but those have been all but erased in the past few months. Net absorption was negative 1.3 million for the past 12 months.
• As expected, the industrial sector in Philadelphia led all sectors. Over the past 12 months, 14.8 million new square feet of inventory became available, and the sector saw 15.6 million square feet in net absorption. Rents grew an average 12.3%.
• Retail remains the sector most responsive to market conditions, but it has also proved to be the most adaptable. Average retail net absorption in Philadelphia continues to improve and was at 1.6 million square feet for the 12 months just concluded. Average rents grew at 2.1%.

WCRE also reports on the Southern New Jersey retail market. Retail highlights from the report include:

• Retail vacancy in Camden County posted an improvement to 9.7 percent, while average rents jumped $1.70, in the range of $13.13/sf NNN.
• Burlington County retail vacancy improved to 8.2 percent in Q1, giving back improvements from the previous quarter. Average rents fell slightly, to the range of $14.31/sf NNN.
• Gloucester County stayed unchanged at 11.3 percent, building on a solid improvement last year, with average rents inching up further, to the range of $16.38/sf NNN.

The full report is available upon request.

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long term growth and success.

Learn more about WCRE online at www.wolfcre.com, on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at www.southjerseyofficespace.com, www.southjerseyindustrialspace.comwww.southjerseymedicalspace.comwww.southjerseyretailspace.comwww.phillyofficespace.comwww.phillyindustrialspace.comwww.phillymedicalspace.com and www.phillyretailspace.com

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Commercial Real-Estate Sales and Values Surge to Records

Investors purchased a record amount of commercial real estate in the third quarter, defying warnings that the Covid-19 pandemic would erode these property values and starve the industry of cash.

Instead, purchases of apartment buildings, life-science labs and industrial properties, which serve as e-commerce distribution centers, rocketed commercial sales to more than $193 billion in the quarter. That is up 19% compared with the same three months in 2019, before the pandemic, and the biggest quarter for commercial property…

*Article courtesy of Wall Street Journal

For more information about New Jersey or Philadelphia health care space, industrial space, retail space, office space, land or other New Jersey and Philadelphia commercial properties, please call 856-857-6300 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading New Jersey and Philadelphia commercial real estate broker that specializes in both New Jersey and Philadelphia cannabis, healthcare space, office space, retail space, land and New Jersey and Philadelphia industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage, and advisory firm, is a premier New Jersey and Philadelphia commercial real estate brokerage firm that provides a full range of New Jersey and Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other New Jersey and Philadelphia commercial properties for buyers, tenants, investors, and sellers.

A New Jersey and Philadelphia commercial real estate broker with expertise in New Jersey and Philadelphia commercial real estate listings, Wolf Commercial Real Estate provides unparalleled expertise in matching companies and individuals seeking new New Jersey and Philadelphia office space, New Jersey and Philadelphia retail space, or New Jersey and Philadelphia industrial space with the New Jersey and Philadelphia commercial properties that best meets their needs.

As experts in both Philadelphia and New Jersey commercial real estate listings and services, the team at our commercial real estate brokerage firm provides ongoing detailed information about Philadelphia and New Jersey commercial properties to our clients and prospects to help them achieve their real estate goals.  

Please visit our websites for a full listing of South Jersey, Philadelphia, and New Jersey commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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WCRE THIRD QUARTER 2021 REPORT

SOUTHERN NEW JERSEY & PHILLY MARKETS’ ANTICIPATED COMEBACK DELAYED BY DELTA VARIANT

Investment Activity & Large Transactions Regained Steam, While Industrial Continued To Lead The Way

Commercial real estate brokerage WCRE reported in its analysis of the third quarter that the Southern New Jersey and Southeastern Pennsylvania markets will have to wait a bit longer for the post-pandemic recovery. While CRE seemed to rebound along with the broader economy earlier this year, the Delta variant caused havoc in recent months.

Download Printable Report (PDF) >>>

At the beginning of 2021, with vaccines and optimism becoming widespread, many employers looked ahead to the week after Labor Day as the beginning of the official return to the office. The emergence of the Delta variant and breakthrough infections pushed the return date into 2022. The effects of this shift have reverberated throughout the economy, including the office and retail CRE markets.

“A few months ago, CRE performance was trending in a positive direction and seemed poised for a return to pre-pandemic levels,” said Jason Wolf, founder and managing principal of WCRE. “While we are in a very positive investment transaction market, the Delta variant has put the office and retail markets into a holding pattern, but a comeback should still be on the horizon.”

In the third quarter there were approximately 225,717 square feet of new leases and renewals executed in the three counties surveyed (Burlington, Camden and Gloucester), a bit below the previous quarter.
New tenant leases comprised approximately 119,213 square feet, or about 53% of all deals for the three counties.

Other office market highlights from the report:

● Overall vacancy in the market is now approximately 12.75 percent, an improvement of .85 of a point from the previous quarter.

● The sales market maintained momentum, with 1,200,393 square feet actively on the market or under agreement.

● There were $70,164,500 in completed sales comprising 709,032 square feet during Q3.

● Average rents for Class A & B product remain unchanged, as they continue to show strong support in the range of $10.00-$15.00/sf NNN or $20.00-$25.00/sf gross for the deals completed
during the quarter. These averages have hovered near this range for more than a year.

WCRE has expanded into southeastern Pennsylvania, and the firm’s quarterly reports now include a section on transactions, rates, and news from Philadelphia and the suburbs. Highlights from the third quarter in Pennsylvania include:

● The vacancy rate in Philadelphia’s office market remained unchanged in Q3, still at 10.3% after hovering near a 20-year low for months. For the past few months, nearly 15% of the total office space in Philadelphia has been listed for sale or lease.

● As in many recent reports, the industrial sector in Philadelphia continued its impressive run, buoyed by its integral role in e-commerce. The last year saw a remarkable 15.8 million SF of net absorption and 11.7% rent growth.

● Retail remains the sector most responsive to market conditions, but it has also proved to be the most adaptable. Average retail net absorption in Philadelphia went into a tailspin when the pandemic began, but for the 12 months just concluded, it is back in positive territory, at 273,000 square feet.

WCRE also reports on the Southern New Jersey retail market. Highlights from the retail section of the report include:

● The Consumer Confidence Index declined steadily throughout the third quarter after posting five consecutive months of increases.

● Retail vacancy in Camden County posted a huge improvement of more than three points to 10.7 percent, while average rents fell more than one dollar, in the range of $11.81/sf NNN.

● Burlington County retail vacancy improved more than a point to 8.3 percent. But it is still above 7.6 percent, where it stood a year ago. Average rents dropped to the range of $13.93/sf NNN.

● Gloucester County posted a decrease of two points, to 14.5 after increasing throughout last year, with average rents virtually unchanged in the range of $14.04/sf NNN.

The full report is available upon request.

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long term growth and success.

Learn more about WCRE online at www.wolfcre.com, on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at www.southjerseyofficespace.com, www.southjerseyindustrialspace.com, www.southjerseymedicalspace.com, www.southjerseyretailspace.com, www.phillyofficespace.com, www.phillyindustrialspace.comwww.phillymedicalspace.com and www.phillyretailspace.com

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Peloton’s Pandemic Expansion Leads to One of the Year’s Biggest US Industrial Lease Deals

Peloton is cranking up its pandemic property expansion as the producer of at-home exercise equipment and classes, signing one of the biggest industrial leases in the United States.

The maker of stationary bikes and treadmills and live and on-demand fitness classes plans to occupy an 840,200-square-foot distribution center in Linden, New Jersey. It’s Peloton’s largest distribution center as well as the 11th-largest industrial lease in the United States and the largest industrial lease in the Garden State so far in the third quarter, according to Adrian Ponsen, director of industrial market analytics for CoStar Group.

“Peloton’s lease is a great example of how consumer behavior in the stay-at-home economy is still helping to drive accelerated industrial leasing more than 18 months after the coronavirus arrived in the U.S.,” Ponsen said.

Peloton, based in New York, has a deal to open a warehouse at 600 Linden Logistics Way at the Linden Logistics Center. That multibuilding industrial park, which is set to have 4.1 million square feet when finished, was developed by Advance Realty Investors of Bedminster, New Jersey, and Greek Development of East Brunswick, New Jersey.

The industrial real estate sector across the nation has performed well, with New Jersey recording record-low vacancies because of the soaring growth of e-commerce, a trend that accelerated during the pandemic. 

*Article Courtesy of Costar

For more information about New Jersey or Philadelphia health care space, industrial space, retail space, office space, land or other New Jersey and Philadelphia commercial properties, please call 856-857-6300 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading New Jersey and Philadelphia commercial real estate broker that specializes in both New Jersey and Philadelphia cannabis, healthcare space, office space, retail space, land and New Jersey and Philadelphia industrial space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage, and advisory firm, is a premier New Jersey and Philadelphia commercial real estate brokerage firm that provides a full range of New Jersey and Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other New Jersey and Philadelphia commercial properties for buyers, tenants, investors, and sellers.

A New Jersey and Philadelphia commercial real estate broker with expertise in New Jersey and Philadelphia commercial real estate listings, Wolf Commercial Real Estate provides unparalleled expertise in matching companies and individuals seeking new New Jersey and Philadelphia office space, New Jersey and Philadelphia retail space, or New Jersey and Philadelphia industrial space with the New Jersey and Philadelphia commercial properties that best meets their needs.

As experts in both Philadelphia and New Jersey commercial real estate listings and services, the team at our commercial real estate brokerage firm provides ongoing detailed information about Philadelphia and New Jersey commercial properties to our clients and prospects to help them achieve their real estate goals.  

Please visit our websites for a full listing of South Jersey, Philadelphia, and New Jersey commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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WCRE SECOND QUARTER 2021 REPORT

WCRE SECOND QUARTER 2021 REPORT: SOUTHERN NEW JERSEY & PHILLY MARKETS FOCUS ON LIGHT AT THE END OF THE TUNNEL

As the COVID-19 Threat Recedes, Good Economic News Helps Shore Up CRE 

WCRE SECOND QUARTER 2021 REPORTCommercial real estate brokerage WCRE reported in its analysis of the second quarter that the Southern New Jersey and Southeastern Pennsylvania markets are cautiously entering the post-pandemic recovery. Although there are still lingering issues, CRE seems to be rebounding along with the broader economy.

“Fundamentals are tracking in a positive direction, and while various challenges remain, conditions are in place that point to a return to pre-pandemic CRE performance,”

said Jason Wolf, founder and managing principal of WCRE.  There were approximately 233,544 square feet of new leases and renewals executed in the three counties surveyed (Burlington, Camden and Gloucester), and while this figure is not indicative of a rebound, it marks the return of net positive absorption. New tenant leases comprised approximately 123,358 square feet, or about 53% of all deals for the three counties. During the previous quarter, this figure was only 8% of the total.

Download Printable Report (PDF) >>>

Other office market highlights from the report:
• Overall vacancy in the market is now approximately 13.6 percent, virtually unchanged from the previous quarter, and holding steady two points higher than at this point last year. 

• The sales market picked up momentum, with 1,257,385 square feet actively on the market or under agreement.

• Average rents for Class A & B product remain unchanged, as they continue to show strong support in the range of $10.00-$15.00/sf NNN or $20.00-$25.00/sf gross for the deals completed during the quarter. These averages have hovered near this range for more than a year.

WCRE has expanded into southeastern Pennsylvania, and the firm’s quarterly reports now include a section on transactions, rates, and news from Philadelphia and the suburbs. Highlights from the second quarter in Pennsylvania include:

• The vacancy rate in Philadelphia’s office market ticked upward again in Q2, and now stands at 10.3%, after hovering near a 20-year low for months. Nearly 15% of the total office space in Philadelphia is listed for sale or lease.

• The industrial sector in Philadelphia remained the bright spot, buoyed by its integral role in the new types of commerce necessitated by the health and safety measures. The last year saw a staggering 9.9 million SF of net absorption and 10.1% rent growth.

• Retail remains the sector most responsive to market conditions, but it has also proved to be the most adaptable. Some essential categories of retail thrived by innovating at the point-of-sale. Average retail net absorption went into free fall during the pandemic, but for the 12 months just concluded, it is -991,000 square feet. While this is a large negative number, it indicates an improvement of several hundred square feet for Q2.

WCRE also reports on the Southern New Jersey retail market. Highlights from the retail section of the report include:

• The Consumer Confidence Index has been rising steadily since it turned around in February.

• Retail vacancy in Camden County jumped more than three points to 14.3 percent after posting a large increase in the middle of 2020. While average rents rose more than one dollar, in the range of $12.86/sf NNN.

• Burlington County retail vacancy dropped to 9.6 percent, an improvement of more than three quarters of a point. But it is still well above 7.6 percent, where it stood a year ago. Average rents increased slightly, to the range of $14.59/sf NNN.

• Gloucester County saw another quarterly increase, to 16.5 after increasing throughout last year, with average rents virtually unchanged in the range of $14.08/sf NNN.

The full report is available upon request.

 

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long term growth and success.

Learn more about WCRE online at www.wolfcre.com, on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at ww.southjerseyofficespace.com, www.southjerseyindustrialspace.comwww.southjerseymedicalspace.comwww.southjerseyretailspace.comwww.phillyofficespace.com,  www.phillyindustrialspace.comwww.phillymedicalspace.com and www.phillyretailspace.com

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WCRE FIRST QUARTER 2021 REPORT

WCRE FIRST QUARTER 2021 REPORT: SOUTHERN NEW JERSEY & PHILLY MARKETS DOWN DUE TO THE PANDEMIC, BUT NOT OUT

Good News on Public Health and the Economy Holds the Promise of Better Days Ahead for CRE

Commercial real estate brokerage WCRE reported in its analysis of the first quarter of the new year that the Southern New Jersey and Southeastern Pennsylvania markets may be through the worst of the downturn brought on a year ago by the pandemic. The widespread availability of effective COVID-19 vaccinations, coupled with large-scale financial relief from the federal government, may bring an optimistic note back to the market. For the moment, market performance on several indicators remains off.

Download Printable PDF >>>

“CRE performance in the first quarter seems to be tracking with our lived experience. As expected, office vacancy is quite high, while demand for industrial space is surging,” said Jason Wolf, founder and managing principal of WCRE. “Market fundamentals are shaky, but there are pockets of strength and resiliency.”

There were approximately 555,988 square feet of new leases and renewals executed in the three counties surveyed (Burlington, Camden and Gloucester), which was more than double the previous quarter. New tenant leases comprised approximately 44,952 square feet, or only about 8% of all deals for the three counties.

Other office market highlights from the report:
• Overall vacancy in the market is now approximately 13.55 percent, virtually unchanged from the previous quarter, and an increase of two full points since Q2 last year.

• Unsurprisingly, office vacancy rates have risen throughout the region. At 11.2%, the rate is the highest it’s been since 2014.

• On the other end of pandemic-induced usage shifts, the already strong industrial vacancy rate improved to 5.4%.

• Average rents for Class A & B product remain unchanged, as they continue to show strong support in the range of $10.00-$15.00/sf NNN or $20.00-$25.00/sf gross for the deals completed during the quarter. These averages have hovered near this range for more than a year.

WCRE has expanded into southeastern Pennsylvania, and the firm’s quarterly reports now include a section on transactions, rates, and news from Philadelphia and the suburbs. Highlights from the first quarter in Pennsylvania include:

• The vacancy rate in Philadelphia’s office market rose another half a point, and now stands at 10.1 percent, after hovering near a 20-year low. Despite the pandemic fallout, the city is still seeing rent and occupancy levels ahead of other major markets.

• The industrial sector in Philadelphia remained the bright spot. The last year saw 4 million SF of net absorption and 7.8% rent growth.

• Retail remains the most responsive to market conditions and the most vulnerable sector. Infection prevention measures and other economic pressures have brought existing issues from before the pandemic into sharper relief. Average retail net absorption for 2020 was 1.8 million square feet, but for the 12 months just concluded, it is -1.4 million square feet. 

WCRE also reports on the Southern New Jersey retail market. Highlights from the retail section of the report include:

• The Consumer Confidence Index rose slightly in February, before rocketing to its highest level in a year in March.

• Retail vacancy in Camden County ticked up to 10.9 percent after posting a large increase in the middle of 2020. While average rents changed little, in the range of $11.76/sf NNN.

• Burlington County inched up to 10.4 percent, representing a small increase on top of the jump from 7.6 percent in Q3 2020. Average rents increased to the range of $14.39/sf NNN.

• Gloucester County saw the biggest jump, up to 15.9 after increasing throughout last year, with average rents up almost a full dollar per square foot in the range of $14.11/sf NNN.

The full report is available upon request.

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long term growth and success.

Learn more about WCRE online at www.wolfcre.com, on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at ww.southjerseyofficespace.com, www.southjerseyindustrialspace.comwww.southjerseymedicalspace.comwww.southjerseyretailspace.comwww.phillyofficespace.com,  www.phillyindustrialspace.comwww.phillymedicalspace.com and www.phillyretailspace.com

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WCRE FOURTH QUARTER 2020 REPORT

WCRE FOURTH QUARTER 2020 REPORT: SOUTHERN NEW JERSEY & PHILLY CRE MARKETS REMAIN ON SHAKY GROUND AS PANDEMIC WEARS ON

Industrial was Strong, While Other Sectors Felt the Brunt of COVID’s Worsening Spread

Commercial real estate brokerage WCRE reported in its analysis of the fourth quarter of 2020 that the Southern New Jersey and Southeastern Pennsylvania markets took an expected downturn in many sectors due to the ongoing coronavirus pandemic. At the same time, restrictions and infection control measures helped build strength in the industrial market, and there is sufficient momentum in the overall economy that the downturn is expected to be temporary. 

Download Printable PDF >>>

“Commercial real estate is challenged by many of the conditions brought on by the pandemic, but the roll-out of the vaccines brings the hope of a return to normal activity sometime this year,” said Jason Wolf, founder and managing principal of WCRE. 

There were approximately 252,823 square feet of new leases and renewals executed in the three counties surveyed (Burlington, Camden and Gloucester), which was a drop of nearly 58% from the previous quarter. New tenant leases comprised approximately 64,450 square feet, or approximately 25.5% of all deals for the three counties surveyed.

Other office market highlights from the report:

• Overall vacancy in the market is now approximately 13.6 percent, which is a jump of about two-thirds of a point from the previous quarter, and an increase of two full points since Q2.

• Average rents for Class A & B product remain unchanged, as they continue to show strong support in the range of $10.00-$15.00/sf NNN or $20.00-$25.00/sf gross for the deals completed during the fourth quarter. These averages have hovered near this range for more than a year.

• Vacancy in Camden County increased to 15.2 percent for the quarter, but despite this slight increase, Camden County saw gradual improvement and prospect activity.

• Burlington County’s vacancy increased to 12 percent after dropping more than a point during the third quarter.

WCRE has expanded into southeastern Pennsylvania, and the firm’s quarterly reports now include a section on transactions, rates, and news from Philadelphia and the suburbs. Highlights from the fourth quarter in Pennsylvania include:

• The vacancy rate in Philadelphia’s office market rose another half a point, to 9.6 percent, after having hovered near a 20-year low. The pandemic has caused a large volume of office space to hit the market.

• The industrial sector in Philadelphia led the market, as it generally does. During Q4 vacancy rates ticked down to 5.1 percent, a slight improvement from the previous quarter. Net absorption for the year was 6.1 square feet. As the pandemic has led to a massive shift toward e-commerce, the industrial sector should remain quite strong.

• Retail CRE remains the most responsive and most vulnerable sector to market conditions. Ongoing coronavirus prevention measures have led to increased vacancy as businesses shutter. Average retail net absorption for 2020 was 1.8 million square feet. The vacancy rate is not expected to improve in the near term. 

WCRE also reports on the Southern New Jersey retail market. Highlights from the retail section of the report include:

• Retail vacancy in Camden County ticked up to 10.5 percent after posting a large increase from Q2 to Q3. While average rents changed little, in the range of $11.78/sf NNN.

• Retail vacancy in Burlington County jumped to 10 percent, up from 7.6 percent, with average rents increasing to the range of $14.14/sf NNN.

• Retail vacancy in Gloucester County went up again, to 13.7 increasing throughout the year, with average rents unchanged in the range of $13.14/sf NNN.

The full report is available upon request.

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long term growth and success.

Learn more about WCRE online at www.wolfcre.com, on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at ww.southjerseyofficespace.com, www.southjerseyindustrialspace.com, www.southjerseymedicalspace.com, www.southjerseyretailspace.com, www.phillyofficespace.comwww.phillyindustrialspace.com, www.phillymedicalspace.com and www.phillyretailspace.com

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WCRE THIRD QUARTER 2020 REPORT

THE SOUTHERN NEW JERSEY & PHILLY CRE MARKETS HEAT UP QUICKER THAN EXPECTED AFTER PANDEMIC-FUELED CHALLENGES

Economic Recovery Lost Steam Through the Quarter, But Leasing Activity was Strong

WCRE THIRD QUARTER 2020 REPORTCommercial real estate brokerage WCRE reported in its analysis of the third quarter of 2020 that the Southern New Jersey and Southeastern Pennsylvania markets out-performed expectations tempered by the ongoing coronavirus pandemic. While the crisis reverberated through the economy and daily life, quarterly CRE indicators throughout the region showed resiliency and even some cause for muted optimism.

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“Uncertainty is high, of course, and will remain high unfortunately, but an economy that seemed to be recovering delivered some good news in our markets,” said Jason Wolf, founder and managing principal of WCRE. 

There were approximately 596,873 square feet of new leases and renewals executed in the three counties surveyed (Burlington, Camden and Gloucester), which was more than double the total for the previous quarter. The jump was driven by Lockheed Martin’s four renewals totaling approximately 320,000 square feet. Even without those transactions, Q3 leasing was about equal to the total for Q2. New tenant leases comprised approximately 93,544 square feet, or approximately 16% of all deals for the three counties surveyed.

Other office market highlights from the report:

  • Overall vacancy in the market is now approximately 12.95 percent, which is a jump from the previous quarter’s 11.5 percent.
  • Average rents for Class A & B product remain unchanged, as they continue to show strong support in the range of $10.00-$15.00/sf NNN or $20.00-$25.00/sf gross for the deals completed during the third quarter.
  • These averages have hovered near this range for more than a year.
  • Vacancy in Camden County increased to 14.9 percent for the quarter.
  • Burlington County’s vacancy increased to 11 percent after dropping more than a point during the first quarter.

WCRE has expanded into southeastern Pennsylvania, and the firm’s quarterly reports now include a section on transactions, rates, and news from Philadelphia and the suburbs. Highlights from the third quarter in Pennsylvania include:

  • The vacancy rate in Philadelphia’s office market rose more than half a point, to 9.1 percent, after having hovered near a 20-year low and below the vacancy rates of comparable major cities at the onset of the pandemic.
  • The industrial sector in Philadelphia led the market, as it generally does. During Q3 vacancy rates ticked down to 5.3 percent, a slight drop from the previous quarter. Although net absorption turned negative for flex and specialized space, it increased by 167,035 square feet for logistics space.
  • As vulnerable as retail CRE may be due to unprecedented job loss and businesses temporarily shuttering and/or reducing capacity, the vacancy rate held steady at 5.1 percent, representing a very small increase over Q2. Net absorption returned to positive territory at 284,752 square feet for the quarter, but is at negative 1.2 million square feet over the last twelve months. 

WCRE also reports on the Southern New Jersey retail market. Highlights from the retail section of the report include:

  • Retail vacancy in Camden County jumped to 9.7 percent from 5.4 percent in Q2. While average rents fell by nearly a third to the range of $11.68/sf NNN.
  • Retail vacancy in Burlington County held steady at 7.6 percent, with average rents increasing to the range of $13.82/sf NNN.
  • Retail vacancy in Gloucester County ticked up half a point to 12.9 from after posting a major increase in Q1, with average rents down in the range of $13.13/sf NNN.

The full WCRE Q3 Market report is available upon request.

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long term growth and success.

Learn more about WCRE online at www.wolfcre.com, on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at www.southjerseyofficespace.comwww.southjerseyindustrialspace.comwww.southjerseymedicalspace.comwww.southjerseyretailspace.comwww.phillyofficespace.comwww.phillyindustrialspace.comwww.phillymedicalspace.com and www.phillyretailspace.com.

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WCRE SECOND QUARTER 2020 REPORT

UNDER SEVERE CORONAVIRUS RESTRICTIONS, THE SOUTHERN NEW JERSEY & PHILLY CRE MARKETS STILL OUTPERFORMED EXPECTATIONS

Despite Widespread Lockdowns, Closures, and Uncertainty, the Market Showed Strength

Commercial real estate brokerage WCRE reported in its analysis of the second quarter of 2020 that the Southern New Jersey and Southeastern Pennsylvania markets held their own amid the most uncertain quarter in recent history. The coronavirus pandemic has upended every aspect of life and deeply impacted the economy. Still, quarterly CRE performance indicators showed some positive news, even as the effects of the crisis began taking hold. Vacancy rates across every property type remained low, and the sales market stayed active.

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“In the face of global calamity, and under severe but necessary restrictions, the CRE market in our area showed strong fundamentals and resiliency,” said Jason Wolf, founder and managing principal of WCRE. “The performance was a mixed bag, but we saw sufficient reasons for optimism.” 

There were approximately 277,716 square feet of new leases and renewals executed in the three counties surveyed (Burlington, Camden and Gloucester), which was a drop of 26% from the previous quarter. New tenant leases comprised approximately 129,569 square feet, or approximately 46.7% of all deals for the three counties surveyed. To help compare Q2 2020 vs. Q2 2019, there were approximately 286,707 square feet of new leases and renewals executed during the same time period a year ago,

Other office market highlights from the report:

● Overall vacancy in the market is now approximately 11.5 percent, which is a slight uptick from the previous quarter, but still not far off from a 20-year low.

● Average rents for Class A & B product remain unchanged, as they continue to show strong support in the range of $10.00-$15.00/sf NNN or $20.00-$25.00/sf gross for the deals completed during the quarter. These averages have hovered near this range for more than a year.

● Vacancy in Camden County increased a full point to 12.6 percent for the quarter.

● Burlington County’s vacancy further dropped to 10.4 percent after dropping more than a point during the first quarter.

WCRE has expanded into southeastern Pennsylvania, and the firm’s quarterly reports now include a section on transactions, rates, and news from Philadelphia and the suburbs. Highlights from the second quarter in Pennsylvania include:

● The vacancy rate in Philadelphia’s office market dropped slightly to 8.5 percent. The office vacancy rate is still near a 20-year low, and below that of comparable major cities. 

● The industrial sector in Philadelphia remains very strong. Q2 saw vacancy rates at 5.5 percent, only slightly higher than the previous quarter. Net absorption dropped about 20 percent, to 4.3 million SF, which was still strong. Rent growth jumped again, to 5.3 percent. Rent growth for the past few quarters has far exceeded the long-term average of 1.7 percent.

● Retail may be most at risk from the crisis. Rising wages and low unemployment had been fueling retail spending, buoying the CRE market. But with unprecedented job loss and many businesses temporarily shuttered by stay-home orders, retail will bear the brunt. The vacancy rate inched up to 5.0 percent, while net absorption was negative 546,300 square feet over the last twelve months. These figures may well become more dire in Q2, as the true economic effects of the pandemic take hold.

WCRE also reports on the Southern New Jersey retail market. Highlights from the retail section of the report include:

● Retail vacancy in Camden County dropped to 5.4 percent from 6.2 percent in Q1. While average rents fell slightly to the range of $17.20/sf NNN.

● Retail vacancy in Burlington County dropped to 7.6 percent, with average rents in the range of $12.14/sf NNN.

● Retail vacancy in Gloucester County ticked down to 12.4 from after posting a major increase in Q1, with average rents in the range of $14.21/sf NNN.

The full report is available upon request.

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long term growth and success.

Learn more about WCRE online at www.wolfcre.com, on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at www.southjerseyofficespace.com, www.southjerseyindustrialspace.com, www.southjerseymedicalspace.com, www.southjerseyretailspace.com, www.phillyofficespace.com, www.phillyindustrialspace.com, www.phillymedicalspace.com and www.phillyretailspace.com.

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WCRE FIRST QUARTER 2020 REPORT

THE YEAR STARTED OFF ON A HIGH NOTE IN THE SOUTHERN NEW JERSEY & PHILLY CRE MARKETS, THEN COVID-19 CREATED CHAOS

Predictions for 2020 Had Been Bullish, But are Now a Great Unknown

Commercial real estate brokerage WCRE reported in its analysis of the first quarter of 2020 that the Southern New Jersey and Southeastern Pennsylvania markets continued their years-long strong performance at the outset of the new decade. But by March it was clear that, just as every other area of life would be disrupted by the Covid-19 pandemic, the CRE market would not be immune. The quarterly performance still showed positive news, but the effects of the crisis began taking hold during the last weeks of Q1, so the true impact hadn’t become fully apparent. Vacancy rates across every property type remain low, and, while rent increases have cooled somewhat, growth remained positive for the quarter. Even before the pandemic struck many feared there were signs that the decade-long expansion was nearing its end. But even as growth slowed down, the economy appeared to be moving forward at a fairly solid pace before the crisis.

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“Initially the assumption was that the worst of the coronavirus outbreak would directly impact the regions in Asia where it first was identified, and that the impact to the U.S. would come in the form of disruption of supply chains and slower economic growth abroad,”
said Jason Wolf, founder and managing principal of WCRE.

“While those shocks have happened, the rapid spread of the virus within the US and around the world has impacted the global economy, and those effects are still becoming apparent throughout our local and regional CRE markets.”

There were approximately 374,429 square feet of new leases and renewals executed in the three counties surveyed (Burlington, Camden and Gloucester), which was up more than 80 percent over the previous quarter. The sales market stayed active, with about 1.02 million square feet on the market or under agreement. Completed sales were up about ten percent over the previous quarter, at approximately 866,444 square feet trading hands.

New leasing activity accounted for approximately 47 percent of all deals for the three counties surveyed. Overall, gross leasing absorption for Q1 was in the range of 110,000 square feet, up about 25 percent over the fourth quarter.

Other office market highlights from the report:

● Overall vacancy in the market is now approximately 11.2 percent, which is significantly improved from the previous quarter, and still near a 20-year low.

● Average rents for Class A & B product continue to show strong support in the range of $10.00-$15.00/sf NNN or $20.00-$25.00/sf gross for the deals completed during the quarter. These averages have hovered near this range for more than a year.

● Vacancy in Camden County ticked down to 11.6 percent for the quarter, as prospecting activity improved.

● Burlington County’s vacancy dropped to 10.8 percent, more than a full point improvement over Q4.

WCRE has expanded into southeastern Pennsylvania, and the firm’s quarterly reports now include a section on transactions, rates, and news from Philadelphia and the suburbs. Highlights from the first quarter in Pennsylvania include:

● The vacancy rate in Philadelphia’s office market dropped slightly to 8.5 percent. The office vacancy rate is still near a 20-year low, and below that of comparable major cities.

● The industrial sector in Philadelphia remains very strong. Q1 saw vacancy rates at 5.5 percent, only slightly higher than the previous quarter. Net absorption dropped about 20 percent, to 4.3 million SF, which was still strong. Rent growth jumped again, to 5.3 percent. Rent growth for the past few quarters has far exceeded the long-term average of 1.7 percent.

● Retail may be most at risk from the crisis. Rising wages and low unemployment had been fueling retail spending, buoying the CRE market. But with unprecedented job loss and many businesses temporarily shuttered by stay-home orders, retail will bear the brunt. The vacancy rate inched up to 5.0 percent, while net absorption was negative 546,300 square feet over the last twelve months. These figures may well become more dire in Q2, as the true economic effects of the pandemic take hold.

WCRE also reports on the Southern New Jersey retail market. Highlights from the retail section of the report include:

● Retail vacancy in Camden County rose very slightly to 6.2 percent from 6.0 percent in Q4. While average rents rose to the range of $17.27/sf NNN.

● Retail vacancy in Burlington County ticked up a second consecutive quarter to 8.0 percent, with average rents in the range of $12.23/sf NNN.

● Retail vacancy in Gloucester County jumped a full point to 12.7 from 11.7 percent, with average rents in the range of $13.71/sf NNN.

The full report is available upon request.

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long term growth and success.

Learn more about WCRE online at www.wolfcre.com, on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at www.southjerseyofficespace.com, www.southjerseyindustrialspace.com, www.southjerseymedicalspace.com, www.southjerseyretailspace.com, www.phillyofficespace.com, www.phillyindustrialspace.com, www.phillymedicalspace.com and www.phillyretailspace.com.

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