The success New Jersey has found in vaccinating its population for COVID-19 is being reflected in the economic recovery, according to a new report from real estate firm Avison Young.
The firm said in its Second Quarter 2021 Office Market Report for New Jersey that the state’s rising vaccine rate and shrinking unemployment rate are expected to fuel a rebound for the sector.
“Although leasing activity slowed significantly during the pandemic, New Jersey’s office market is poised for recovery as the state’s vaccination rate continues to surpass national averages, restrictions loosen and more companies begin welcoming employees back to the workplace,” Jeff Heller, principal and managing director of Avison Young’s New Jersey office, said in a prepared statement. “Property inquiries are also starting to pick up and, while companies are still taking a wait-and-see approach, we anticipate this will translate to more deal volume throughout the year when workers are back in the office and companies have better understanding of their real estate needs.”
Avison Young found that base rents in the state have dipped by only 1.8% since the start of the pandemic and 0.4% since the end of 2020 — much less than the levels seen during the financial crisis and Great Recession.
In addition, sublease space in the market rose 65.9% since the end of 2019 and sales volume has stabilized since the second quarter of 2020, Avison Young said.
“New Jersey’s labor force participation hovered at 62.5%, rising 60 basis points since September 2020 during its pandemic low,” Jason Bloom, a Northeast insight analyst in the New Jersey office, said in a statement. “We will be closely monitoring the labor participation rate during September 2021, as in-person classes resume and enhanced federal unemployment is scheduled to expire, which we believe will lead to more adults returning to the work force.”
For the complete report, click here.