2019 ended on a high note, showing signs of continued strength in both the office and industrial markets, according to Colliers International‘s Q4 2019 New Jersey office and industrial market snapshots.
The state’s industrial market was energized in the fourth quarter of 2019, as high demand for large blocks of space kept absorption remaining positive for the 28th consecutive quarter, Colliers said.
Key takeaways include:
- Q4 recorded 11 million square feet of leasing activity — the second highest total since 2016;
- Full-year leasing activity hit 42.1 million square feet, up 6% year-over-year;
- Amazon was a top driver of demand, responsible for seven deals in Q4, totaling 1.7 million square feet;
- The availability rate improved by 50 basis points since last year to 4.3%;
- Average asking rents are up 8.5% year-over-year to $8.95 per-square-foot.
The quarter ended in a big way for the state’s office market, with availability dropping to a low of 18.7% — a level not seen since the first quarter of 2009 — while average asking rents reached a high ($26.62 per square foot) not seen since the fourth quarter of 2008.
Leasing activity recorded 2.8 million square feet, the highest quarterly total of 2019.
In North Jersey, the market’s availability rate improved by 30 basis points year-over-year to 19.1%, driven by tenant expansion and new leases. Leasing activity also improved year-over-year by 24.3% to 1.7 million square feet.
In Central Jersey, the market fluctuated between positive and negative net absorption, ending the year on a positive 561,685 square feet. However, the availability rate decreased 10 basis points year-over-year to 18.1% and leasing activity totaled 1.2 million square feet.