Cushman & Wakefield report comforts the state.

Cushman & Wakefield of New Jersey, Inc. has released its third quarter 2004 office and industrial market research statistics. The data, which covers 10 counties in northern and central New Jersey, provides information on vacancy rates, rental rates, inventory and construction. Compiled by the firm's research services team, the latest statistics and recent market activity indicate a number of industry trends:

Investment sales activity exploded in the northern New Jersey office market during the third quarter, and many trophy properties changed hands. Highlights included the acquisition of 17 office buildings by a partnership between The Gale Company and SL Green/Wachovia Securities from Morgan Stanley Real Estate Funds and UBS.

Sublease space stabilized throughout the region. Some 5.4 million s/f of sub lease space is on the market, comprising 29% of total available product. Large sublease availabilities include 1.1 million s/f from UBS PaineWebber at Newport Office Center VII in Jersey City.

New space added to the market includes the 755,000 s/f balance of BASF's former 970,000 s/ f facility in Mount Olive.

In Jersey City, the 1.36 million s/f office tower for Goldman Sachs was completed, representing the tallest building in New Jersey. This helped Northern New Jersey absorb more than 400,000 s/f during the third quarter.

The normally slow summer months in northern Jersey witnessed only slight movement in available product. Overall vacancy rates remain in the 17% range.

The two largest transactions of the quarter occurred in Florham Park, where Novartis took 145,000 s/f at the former AT&T building and Odyssey Pharmaceuticals committed to 50,000 s/f at Park Place.

The central New Jersey office market activity increased, and overall vacancy rates continued to moderate and stand at 21.5%. The announced move of Citigroup to 715,000 s/f within the five-building Warren Corporate Center represented the year's largest lease to date.

Sublet space is declining, but still comprises 24% of total available product. Lucent Technologies continues to market 650,000 s/ f in Warren township and Middletown, while Prudential, Motorola, JDS Uniphase, Wachovia and the Great West Life & Annuity Insurance Co. each have in excess of 130,000 s/f of sublet space on the market.

The completion of a 200,000 s/f build-to-suit facility for Horizon Blue Cross Blue Shield of New Jersey in Neptune highlighted development activity.

Investors remained active during the third quarter. A partnership between The Gale Company & SL Green/Wachovia Securities agreed to buy out the interests of Morgan Stanley Real Estate Funds and UBS at six properties in central New Jersey. The Rouse Company bought a 653-acre site in North Brunswick for $35 million.

Four assets changed hands in Franklin township. Lewis Stahl bought 580 Howard Boulevard and 200 Cottontail Lane, totaling 360,000 s/f, for $15.8 million. Pierce Davidson sold the 228,270 s/f 270 Davidson Ave. to the Herrick Group for $26.5 million.

BGK Properties bought the 162,206 s/f 220 Davidson Ave. for $16.8 million.