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Princeton office rents may increase by year-end.

Princeton's Route One corridor has reaffirmed itself as New Jersey's high-tech valley. Anchored by Princeton and Rutgers Universities, the region has become one of the country's premiere locations for research and development firms, whose continuing demand for space is exerting an upwards pressure on office rents. Although Princeton, in general, is operating at an average vacancy factor of 20 percent, there is virtually no large space currently available. And with no new construction on the immediate horizon, supply and demand are quickly coming into balance. Concessions are already disappearing and it would come as no surprise to see rents begin to edge upwards by year's end.

At College Park at Princeton Forrestal Center demand for space, largely from high-tech companies, accounted for 209,000 square feet leased or renewed at the park during 1992. With the addition of such firms as Panasonic Technologies, Polystrata Pharmaceuticals, Inc.

Advanced Surgical Inc. and Cytogen to our tenant roster, College Park now enjoys a better than 95 percent occupancy factor.

Access to the resources of prestigious academic centers, a rich cultural life, and a wide range of housing choices have made this an extremely desirable area for businesses which must attract a sophisticated and talented work force. Not surprisingly, Princeton topped New Jersey Monthly's 1993 list of best places to live.

We are concerned, however, that lack of financing for new construction, an onerous approvals process, and inadequate roadways and sewer capacity could ultimately inhibit long term growth in the region. Given the current lending and development scenarios, we feel that existing building stock will become stressed, resulting in a much more competitive market in the not so distant future.
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Title Annotation:Mid-Year Review & Forecast, Section III; Princeton, New Jersey; end of 1993
Author:Tomai, Timothy
Publication:Real Estate Weekly
Article Type:Column
Date:Jun 23, 1993
Words:276
Previous Article:Five hot areas for real estate investment.
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