New Jersey’s sublease space is at an 18-year high, even as office occupants continue to make reentry plans, according to real estate firm JLL’s Q2 Office Outlook report.
The real estate firm said corporate restructurings elevated the supply of sublease space to 7.7 million square feet at midyear, which compares with 6.4 million square feet in the early part of 2021. That represents the highest availability since the end of 2003.
However, rising vaccination rates could help pent-up demand for space gain momentum during the second half of the year, the firm said — unless the COVID-19 Delta variant throws a wrench into those plans.
The overall vacancy rate in New Jersey’s office market rose to 27.3% by midyear, compared with 26.4% in early 2021. However, excluding sublease space, the direct vacancy rate only edged higher by 10 basis points, to 22.3%.
Subleases, in fact, account for just over 18% of total available office space, compared with a high of 40% in 2002.