The Industrial and Office Real Estate Brokers Association of New Jersey recently hosted its 27th annual Developers Night event at the Marriott at Glenpointe Hotel in Teaneck.
A panel of veteran real estate experts offered their views on the state of New Jersey’s office, industrial and multifamily housing marketplaces, educated the audience on growing trends and offered predictions for the coming year.
Hundreds of guests from the commercial real estate industry were on hand for the event, which included panelists Matt Campbell, director of land acquisition, Toll Bros.; Ian Christ, managing director, Prudential Real Estate; Jeff Milanaik, partner, Northeast Region, Bridge Industrial; Michael Pembroke, chief operating officer, Russo Development; Ryan Sanzari, president, Alfred Sanzari Enterprises; and Jonathan Schultz, managing principal, Onyx Equities.
“We were fortunate to have this panel, whose expertise and experience spans many decades in the industry,” said IOREBA President John Johnson, who served as panel moderator.
The panelists agreed that the past two years have been a transformative time for the CRE industry and staying ahead of trends is key. They also agreed that the market continues to show dominance for certain asset classes, while COVID-19 continues to loom over others, and that trends that developed during the pandemic are here to stay for the foreseeable future.
Despite the ongoing pandemic-related challenges, opportunities exist for New Jersey’s CRE industry. Demand for logistics, industrial, data centers, life sciences and multifamily developments has been extremely strong. The industrial section is the hottest sector, dominating the others. The question is, are these areas getting overheated and overvalued? Time will tell. Industrial space in the Meadowlands, for example, recently hit $28 per square foot, Milanaik noted.
Other key takeaways included opinions from panelists such as Schultz, who suggested ways to lure employees back to the office will depend on creating contemporary amenities and offering hospitality features in today’s office buildings.
New Jersey continues to undergo a repositioning of its many corporate campuses that are becoming functionally obsolete, with archaic zoning in place. Pressure is mounting to design a new type of office by creating features that will entice companies back.
Sanzari is optimistic on Class A office building leasing and has seen an uptick in activity to almost pre-pandemic levels.
Developers are continuing to reposition office buildings into multifamily housing with live-work-play amenities, and with shopping nearby, that will appeal to the community and corporations. Multifamily vacancy rates are below 1.5%. Panelists Pembroke and Campbell greed that collaboration between development companies will be necessary in today’s tight market to move forward.