In late March, Gov. Phil Murphy ordered the shutdown of non-essential businesses in the state to help mitigate the spread of COVID-19. The result of that will have lasting effects for all property types, especially industrial real estate, according to a new CBRE Research Market Flash report.
The report, “Northeast Industrial Markets Demonstrate Resiliency”, showed that leasing activity within the Northeast corridor — which includes New Jersey, the outer boroughs of New York City, the Philadelphia metro area and Pennsylvania’s I-78/I-81 corridor — was down in February and March but turned around in April.
The Top 3 industries that drove the activity include:
- Retailers looking to quickly expanding their e-commerce operations;
- Traditional e-commerce companies; and
- Third-party logistics firms.
COVID-19 has forced many to shop online to avoid crowds and congregations. In turn, this will further increase e-commerce’s market share of total retail sales.
In North/Central Jersey, e-commerce’s demand for warehouse space was 43% of the area’s total industrial activity, or 1.16 million square feet, while 3PL demand claimed 19%. The activity shows a stable industrial market, the report said.
