PARSIPPANY, NJ-The New Jersey office market vacancy rate dropped0.8% to 25.6% during the third quarter according to new research byJones Lang LaSalle. Although the drop is slight, it represents themost significant decline in overall vacancy since the first quarterof 2005.

The state’s third quarter vacancy rate is the lowest in fiveconsecutive quarters and indicates that there is less than 40million square feet of office space available. This may point tothe market hitting bottom and stabilizing in the future. “Thisvacancy rate drop is due to a combination of factors: a decline innew product being placed on the market, robust leasing activity andseveral transactions by large users purchasing buildings for theirown use,” stated Dan Loughlin, managing director at JLL.“Year-to-date leasing activity is well ahead of last year’s pace,another key positive indicator,” he tells GlobeSt.com. “However,vacancy levels are not anticipated to decrease significantly untilNew Jersey experiences consistent job growth.”

While New Jersey’s statewide vacancy rate was 25.6% during thethird quarter, in the northern part of the state it fell to 22.4%from 22.8%, while the rate in Central New Jersey remained unchangedat 31.8%. When a handful of the market’s largest blocks of space,which cannot accommodate most tenants' requirements today areeliminated from the vacancy rate, New Jersey office vacancydeclines several percentage points to 23.1%.