Retail rental rates staging comeback, expert says

The absorption rate of big-box retail space in New Jersey is increasing, with the Paramus-based Goldstein Group closing eight such transactions at the end of 2011, including four gyms, in northern and central New Jersey.

Chuck Lanyard, president, said the New Jersey market is starting to see rent prices come back after dipping nearly 20 percent during the past three to four years. The market is still considered favorable for tenants, but Lanyard said landlords are becoming more realistic in order to fill the spaces available.

“The bigger boxes were sitting much longer, because it was only the smaller tenants that were doing deals,” Lanyard said. “Now, what we’ve seen the trend swinging toward bigger, larger spaces finally being leased, and there’s more and more of that happening in New Jersey.”

Out-of-state retailers are entering the New Jersey market for the first time, including Harbor Freight & Tool, with two locations, The Tile Shop, in Rochelle Park, and a soon-to-open Hobby Lobby, in Millville. JoAnn Fabrics opened up a 30,000-square-foot store in Paramus at a former CompUSA location.

“The retail marketplace is picking up because of the improvements in consumer spending,” Lanyard said. “People are spending more to shop, and that’s always a good sign for New Jersey’s economy.”