The first quarter of 2019 was record-breaking on many fronts for New Jersey’s industrial sector, according to CBRE. The market experienced outstanding across-the-board improvement in both year-over-year and quarter-over-quarter metrics, resulting in extremely low availability rates, especially for high-quality spaces. Reflecting this strength was a more than three percent rise in the average asking lease rate to a new record high of $7.25 per square foot.
“The industrial market in New Jersey continued to stand out as one of the hottest and most active markets in the country,” said William Waxman, executive vice president, CBRE. “The influx of e-commerce and logistics users continued unabated during the first quarter, a trend that is sure to remain given New Jersey’s ideal location in the Northeast, strong market fundamentals and highly qualified labor pool.”
The availability rate ended the first quarter at 6.4 percent, 20 basis points (bps) below the previous quarter and 40 bps down from Q1 2018. Leasing activity continued to be robust, with 6.9 million square feet of new transactions registered during the quarter—an increase of 750,000 square feet, or 12 percent, over Q4 2018. Net absorption, at 4.5 million square feet, posted the third-highest quarterly total in the past five years and the best first quarter of all time since CBRE began tracking these metrics.
The first quarter ended with 19 developments under construction, totaling 5.8 million square feet. Additionally, 10 buildings were completed during the quarter, which added 3.3 million square feet to the inventory.
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