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Given that last time I wrote about Grubb & Ellis’ New Jersey fourth quarter office report, it seems only fair that I discuss the firm’s overview of the industrial sector for the same period.

The news is consistently positive, as growing demand is meeting a diminishing supply. The result is the lowest availability level since mid-2008, as more than 16.3 million square feet was absorbed in Northern and Central New Jersey over the last two years. Last year ended with an availability rate of 11.4%, down from the 12.5% posted at yearend 2010. And the firm predicts a further decline to 10.5% this year.

Central New Jersey has seen the bulk of the absorption, with 97% of the 6.9 million square feet absorbed last year located there. That’s not surprising, given the concentration of large boxes in that region, particularly along the Exit 8A corridor. But Northern New Jersey, particularly the port area, should pick up as infrastructure improves in the wake of the Panama Canal expansion.

What will keep the market strong? As the saying goes: Location, Location, Location. The state’s location between New York and Philadelphia, and proximity to other markets on the East Coast simply can’t be beat.

The best news? Growth is on the way. Says the report: “The shrinking supply of existing availabilities will challenge users seeking large blocks of modern distribution space and usher in the next round of new construction in 2012.”