Availability in the North Jersey’s office market is tightening, even as leasing velocity is slowing down, according to Savills‘ Northern New Jersey 2019 Q2 Office Market Report.
With fewer large deals taking place, the report said that second quarter activity dropped to 1.4 million square feet, the lowest figure seen in the past five quarters.
Despite the slowdown, availability in the second quarter ended at 22.9%, a 370-basis point decrease year-over-year, the report said.
Savills said that demand in existing product is strong, as class B and C space contribute greatly to the decline. Availability for Class B and C product was down 710 basis points over the same period, now at 17.5%, it said.
No deals over 100K
The largest lease in the second quarter was Genmab committing to 90,000 square feet at 777 Scudders Mill Road in Princeton, the report said. This was the only lease greater than 50,000 square feet signed in the quarter.
It’s a tenant’s market
The report said tenants seeking large blocks of space (100,000 square feet or more) have plenty of options throughout the market.
Currently, there are more than 60 buildings that are 100,000 square feet or greater ready for occupancy within the next year.
The largest space to be coming to the market this quarter was a sublease listing at 200 Plaza Drive in Secaucus, a 250,000-square-foot building.
Sales activity continues through mid-year
Savills noted the largest sale of the quarter happened in the Brunswick submarket at 1 Tower Center Blvd. It sold for $38 million.
