New Jersey real estate market still strong.
The first three quarters of 2001 have shown continued demand and growth among the pharmaceutical, logistics and insurance companies, this coupled with little new development, has caused rental rates to remain steady. While the technology sector has been weak, most of the economy is still showing signs of growth.
One of the most exciting new development trends over the past year is the renaissance taking place in our state's urban areas. In cities like Newark, Harrison, Trenton, Bound Brook, the Amboyis and, of course, the entire Hudson River waterfront, the developmental, political and cultural communities have converged to push growth back to the urban market. These initiatives are definitely sustainable which bodes well for new development opportunities.
New construction projects are experiencing strong success with their pre-leasing efforts. A look throughout the state shows that there are very few spec office buildings remaining empty. Many developers are continuing to experience great success in redevelopment as well. These developments offer tenants virtually new space, with the advantages of modem construction at lower rental rates. This market should remain strong with potential new redevelopment sites still available. Older buildings are being upgraded in order to accommodate the technology needs of todayis tenants, thereby making them more marketable. Most buildings are being re-wired for high-speed voice, data and Internet usage, which makes them more attractive to new users.
Another factor keeping the market strong is the abundance of smaller users in the marketplace. While the headlines may be dominated by large-scale lay offs, the real story throughout the state is the growth among smaller, entrepreneurial companies who have taken advantage of the high-tech revolution.
The slowdown in the technology and financial services sector has increased the amount of available sublets in the marketplace. While it has caused vacancies to rise substantially, this new space affords tenants new leasing opportunities; i.e., several large sublet transactions occurred in the wake of the recent tragic events in New York.
The, future is very positive for New Jersey's real estate marketplace. The state is underlying strength lies in the diversity of its economy. With so many industries making up the marketplace, New Jersey has not been as deeply impacted by the dot-com crash as many other areas of the country. The underlying fundamentals, including a lack of new development, strong demand and new markets being created, all point to continued growth in the market. New Jersey's strategic location between Washington, D.C./Philadelphia corridor and New York, coupled with its supply of developable projects, continues to fuel the growth of our office and industrial marketplace.
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|Author:||Hanson, William C.|
|Publication:||Real Estate Weekly|
|Article Type:||Brief Article|
|Date:||Jan 30, 2002|
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