The southern New Jersey real estate market is in good shape, but remains in somewhat of a holding pattern, according to commercial brokerage WCRE’s latest quarterly analysis.
“For most of 2017, we have seen an overall positive tone and conditions that usually indicate a period of strength,” said WCRE’s founder and managing principal, Jason Wolf. “The national economy has been adding jobs, the financial markets are on a hot streak, and our market continues to attract outside investors — yet, increased activity and enthusiasm are tempered by trouble in the retail sector and uncertainty related to current events.”
Marlton-based WCRE surveyed Burlington, Camden and Gloucester counties, and found a 6.6 percent increase in new leases and renewals over the previous quarter.
The approximately 421,113 square feet of new and renewed leases was a 15 percent increase over the same period last year.
New leasing activity accounted for about 43.3 percent of all deals.
While leasing showed moderate gains, the sales market was quite active during the third quarter, with more than 1.76 million square feet worth more than $105 million of completed sales transactions trading hands.
Overall vacancy in the market is now about 9.75 percent, an improvement over the previous quarter.
Camden County’s vacancy continued to improve, from 13.3 percent at the beginning of the year to 10.8 percent in the most recent quarter.
WCRE has expanded into southeastern Pennsylvania, with the Philadelphia industrial market continuing to grow.
Vacancy rates for flex and industrial properties in Philadelphia are well below the regional and national averages, and that is expected to continue.
The Philadelphia retail sector is the one area that is not performing well, suffering typical retail challenges, such as the shift to online purchasing.
However, community shopping centers remain an area of strength in the market, with vacancy rates nearly half the national average.
WCRE also reports that, in the southern New Jersey and Philadelphia retail market, there were slight declines in consumer confidence and related metrics in the retail markets as the third quarter ended.
Overall retail sales were 3.2 percent higher this year compared with 2016.
Retail vacancy in Camden County stood at 9.5 percent; Burlington County at 10.7 percent; and Gloucester County at 7.9 percent.