WCRE FINDS SOUTHERN NEW JERSEY MARKET RECOVERY IS SLOW, BUT RENTAL RATES AND CONFIDENCE HAVE IMPROVED
Great Leasing Opportunities for 2013 in the Southern New Jersey Market
December 10, 2012 – Voorhees, NJ – While overall office real estate vacancy rates remain stuck in the vicinity of 18-20 percent, where they have been for the past several years, there have been developments in the Southern New Jersey market that mean good news for investors and tenants alike. According to new research by WCRE, rental rates have increased from an average of $7.00 – $9.00/sf NNN a few years ago to deals now being completed in the $11.00-$14.00/sf NNN range. On the other side of the market, because positive absorption has been slow, there are still plenty of Class A and Class B opportunities for tenants seeking to upgrade their space.
On the rebound in rental rates, WCRE’S founder and principal Jason Wolf said, “We’re still restructuring lease terms today 15 to 20 percent below where they were in 2007, but the leasing price points are higher than they were two years ago, which has been driving higher deals.” The new report explains that even with continuing high vacancy rates, great locations are performing well and causing rents to increase. Businesses overall have shown confidence by committing to longer lease terms. “We are now seeing lease terms of 7 and 10 years for larger size tenants,” which indicates their confidence in business growth and their ability to secure historically low rates.
While owners can be pleased by the uptick in rental rates, opportunity is plentiful for tenants, as well. Tenants in the market for 10,000-40,000 square feet who are considering a “flight-to-quality” have ample opportunity to negotiate on rent for Class A space, Wolf notes. The stubbornly high vacancy rate continues to enable tenants to negotiate for better lease terms and/or upgrade their space.
WCRE surveyed availabilities at Class A and Class B buildings that can accommodate up to 100,000 square feet in Cherry Hill, Marlton, Moorestown, Mount Laurel, Pennsauken and Voorhees. Overall, Mount Laurel presents the highest proportion of opportunities, with almost 50 buildings offering space of 10,000 square feet or less, along with a significant supply of larger offices.
WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, industrial and investment properties. We provide a complete range of real estate services to commercial property owners, companies, 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 @WCRE1, and on Facebook at Wolf
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