The fourth quarter was a challenging one for the South Jersey market and the neighboring Southeastern Pennsylvania region, according to Marlton-based real estate firm WCRE.
The firm’s Q4 report on commercial real estate found that the pandemic caused the expected downturn in many sectors, while restrictions and infection control measures helped strengthen the industrial market.
The firm noted that it expects the downturn in the region to be a temporary one.
“Commercial real estate is challenged by many of the conditions brought on by the pandemic, but the rollout of the vaccines brings the hope of a return to normal activity sometime this year,” founder and Managing Principal Jason Wolf said in a prepared statement.
The three New Jersey counties surveyed — Burlington, Camden and Gloucester — saw approximately 252,823 square feet of leases and renewals, a drop of nearly 58% from the previous quarter, the report found. New leases made up about 64,450 square feet of the total, or 25.5% of the deals.
Office vacancy jumped about two-thirds of a percentage point from the prior quarter, to about 13.6%, which is a full two points above the second quarter mark. However, average rents for Class A and Class B product remained unchanged in the region.
Finally, WCRE noted that retail vacancy in all three counties reached or exceeded 10%, with Burlington at 10% even, Camden at 10.5% and Gloucester at 13.7%.