Despite moderation in leasing activity in fourth quarter 2013, the South Jersey commercial real estate market experienced an overall strong year that has the market primed for an even better 2014, according to a new quarterly market analysis from Wolf Commercial Real Estate, a leading Philadelphia commercial real estate brokerage firm that specializes in South Jersey and Philadelphia commercial real estate listings and services, including Philadelphia office space and other Philadelphia commercial properties.
The report by the Philly commercial real estate broker noted many positive trends in both the fourth quarter and the year that again proved the resiliency of the South Jersey’s commercial real estate market.
“Total leasing activity was slightly off this quarter compared with the fourth quarter of 2012, but we saw 14.5% growth in activity in our market in 2013,” said Jason Wolf, founder and principal of Wolf Commercial Real Estate, a premier Philadelphia commercial real estate broker. “As exciting as it is to report this surge, based on the conditions in place, we expect 2014 to be even stronger.”
The area’s commercial real estate market was very active in the fourth quarter, with further stabilization of rents, a pending mega-deal for a 24-building office/flex portfolio, and a great deal of prospecting setting up a high number of transactions that will consummate in the early part of the new year, according to the report issued by Wolf Commercial Real Estate, a Philly commercial real estate brokerage firm that specializes in South Jersey and Philly commercial real estate listings and services, including Philly office space and other Philadelphia commercial properties.
New leases and renewals executed in the three counties surveyed declined nearly 1.7% to approximately 374,121 square feet, compared to the fourth quarter of 2012. But the Philadelphia commercial real estate brokerage firm reported +/-1,625,190 square feet of total activity for the year in the same geographic region, compared to +/-1,419,276 square feet in 2012. Notably, expansions and new deals remained strong this quarter, with net absorption at approximately 102,294 sf.
The report noted that strong demand in the region’s commercial real estate market has been powered in part by the continuing nationwide economic rebound. The stock market achieved several record high closes, finishing the year up 26%, and both the state and the national unemployment rates improved. New Jersey’s unemployment rate closed the fourth quarter at 7.8%, falling nearly two full points over the course of the year. The national unemployment rate stood at 7% as the year ended.
The two most significant developments in the quarterly report were the further reduction of the region’s vacancy rate, which now is down to approximately 15%, and Liberty Property Trust’s (NYSE: LRY) announcement that its entire office/flex portfolio in the region was put under agreement. The portfolio comprises 1,188,285 square feet in 24 buildings.
Other office market highlights in the report from Wolf Commercial Real Estate, a Philly commercial real estate broker that specializes in South Jersey and Philadelphia commercial real estate listings and service, including Philadelphia office space and other Philadelphia commercial properties:
– Average rents for Class A & B product continue to show strong support in the range of $11.00-$14.00/sf NNN or $21.00-$24.00/sf gross, with an overall market average showing strong support in the $11.00-$11.50/sf NNN or $21.00-$21.50/sf gross for the deals completed during the fourth quarter. This is essentially unchanged from the previous quarter, the Philly commercial real estate brokerage firm said.
– Moorestown, Marlton and Mount Laurel (3M) continue to show strength, while a large share of the region’s vacancies remain in Voorhees, Pennsauken, and the west side of Cherry Hill. Burlington County continued to maintain a significantly lower vacancy rate than Camden County.
– There was a very active pipeline of deals that will be completed soon, covering approximately 400,000 sf.
– All of the major private owners and REITS showed a significant increase in prospect activity for the quarter, and are all cautiously optimistic for 2014.
The retail report from the Philadelphia commercial real estate broker that specializes in South Jersey and Philly commercial real estate listings noted that even amid weak holiday sales figures, retail leasing activity in the region was strong, with owners cautiously optimistic. Highlights from the retail section of the report include:
– Overall retail vacancy in the tri-county area is hovering around 10.7%, marking tremendous improvement from the end of 2012, when it was hovering in the 17-18% range.
– Class A retail product rental rates continue to show strong support in the range of $30.00-$40.00/sf NNN.
– Class B product shows support in the range of $15.00-$23.00/sf NNN.
The full quarterly report is available upon request from Wolf Commercial Real Estate, a Philly commercial real estate broker that specializes in South Jersey and Philadelphia commercial real estate listings and services, including Philly office space and other Philadelphia commercial properties.
For more information about Philadelphia office space or any Philadelphia commercial properties, please contact Jason Wolf (215-799-6900, jason.wolf@wolfcre.com) or Leor Hemo (215-799-6900, leor.hemo@wolfcre.com) at Wolf Commercial Real Estate, a Philadelphia commercial real estate broker.
Wolf Commercial Real Estate is a premier Philly commercial real estate brokerage firm that provides a full range of South Jersey and Philly commercial real estate listings and services that include Philly office space and other Philadelphia commercial properties. We market commercial offices, medical properties, industrial properties, land properties, retail buildings and other South Jersey and Philadelphia commercial properties for buyers, tenants, investors and sellers. Please visit our websites for a full listing of Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.
