Marcus & Millichap report: Northern New Jersey ranked No. 11.
Northern New Jersey's No. 11 NRI ranking is unchanged from 2002. Investor interest is high in the region with sales volume totaling $572 million in 2002, compared with $400 million in 2001. Washington, D.C., ranked as the top retail market in the nation for the second consecutive year due to its compelling demographics and reliable economic engine fueled by the public sector. Rounding out the top five were Orange County, Calif., (No. 2), San Diego (No. 3), Boston (No. 4) and Fort Lauderdale, Fla., (No. 5). The top-ranked markets are typically characterized by low vacancies, prospects for rental growth, limited new development, and solid employment and household growth. High vacancy rates and a lackluster economic outlook contributed to Cleveland's ranking (No. 38) at the bottom of the index. Las Vegas made the biggest jump in the year-over-year standings, climbing 10 spots to No. 13. The gaming capital sported the highest expected employment and household growth rates among the 38 markets surveyed. The Seattl e market suffered the biggest slide in the NRI, falling 18 spots to No. 30, primarily due to the area's economic and employment setbacks.
Following are some of the most significant details regarding the Northern New Jersey market:
Northern New Jersey lost 13,000 jobs in 2002, a decrease of 0.7%. Nonetheless, retail sales growth remained positive, though not as strong as in recent years. As the local market turns the corner, employers will end two consecutive years of job losses by adding to payrolls. Employment growth will post an increase of 1% in 2003.
* Developers were unable to shelf projects in light of the economic slowdown. As a result, more than 4 million SF of space was delivered in 2002. Only 1.8 million SF will be completed in 2003, as developers delay projects until local economic conditions improve.
* Vacancy climbed from 6.5% in 2001 to 7.1% in 2002, due to chain store closings, new centers coming online and a contracting population base. Vacancy will inch higher in 2003, to 7.2%, due to further closings and consolidation among a few retailers.
For additional property market research on Northern New Jersey and other markets nationwide, visit our website at www.marcusmillichap.com.