"As major corporate players strive to gain market share and profitability, the landscape of New Jersey-based businesses is seeing significant changes," according to Eisen. He points to the mergers of Honeywell and Allied Signal, Warner Lambert and Pfizer, and Philip Morris and Nabisco.

"The companies that remain in charge in those cases are based out of state," he points out. "As a result, their real estate decisions could have a marked impact. At the same time, a number of companies find themselves with excess real estate holdings, and they're looking to purge their property assets through subleases and dispositions."

According to C&W statistics, for the first half of this year, the Northern New Jersey market now has close to 2.9 million sf of sublease space available. That's approximately triple the amount from the same time last year. For users, investors and owners, that creates "prime expansion and acquisition opportunities," Eisen says. "Subleases and purchases will drive activity in the coming months."

Still, direct vacancies and asking rents are stable, according to C&W's numbers. Some markets, especially Morris County, the Princeton region and the Hudson waterfront "maintain strong activity levels. But inevitably, the short-term slowdown will likely reflect in statistical changes in the coming months," he admits. "Frankly, it would be impossible to sustain the levels of demand and occupancy the market has experienced for the last few years."

The recent trends have shown up in C&W's real estate business. "Our focus is rapidly shifting," Eisen explains. "Our emphasis has clearly moved from finding space to solving problems. Portfolio consolidations have become a mainstay of our activity."

What's next? Eisen predicts that "Wall Street's struggles will continue to fuel the real estate market's direction. In the short term, our outlook is cautious. In the long term, it remains bullish, but for now, we could be facing a long, hot summer in Northern New Jersey."