The office market in the Garden State recorded its fifth consecutive quarter of positive net absorption, driving the state’s average asking rent to a historical peak of $27.22 per square foot, marking the first time the average has ever exceeded $27 per square foot, according to Transwestern Commercial Services’ Second-Quarter 2019 Office Market Report.
Vacancy rates across the state have continued to improve, reaching a 10-year low.
Multiple submarkets throughout the state are experiencing higher than 5 percent year-over-year growth in rents including Woodbridge/Metropark, Edison South, Parsippany Region, Hudson Waterfront, Wayne/Paterson, Somerset/Interstate 78 East.
Of the state’s 21 submarkets, 15 are experiencing higher rents year over year and compared to the previous quarter. Additionally, 13 of the 21 submarkets are experiencing occupancy levels higher than the state average.
“Continued demand for high-quality office space is supporting both successful repositioning of existing assets within prime locales and this cycle’s first speculative ground-up office development. These factors are putting upward pressure on overall market rents,” said Matthew McDonough, TCS managing director. “The steady success of the New Jersey commercial real estate market is encouraging investors to move forward with new development plans throughout the state, in both urban and suburban areas.”