MARLTON, NJ-The long-wan southern New Jersey office market seemsto have begun to shift from recovery mode to the promise of growth– at least according to a new analysis from WolfCommercial Real Estate, which is based here.

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The firm's 2nd Quarter market report indicates mostlypositive trends so far in 2014, and WCRE brokers report the thirdquarter is going to be very strong: There are 350,000 square feetof pending deals expected to close during the quarter.

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“The CRE market was very busy during the 2nd quarter,bouncing back from the setbacks imposed by the harsh winter toreclaim another portion of vacancy and set up a healthy pipeline ofdeals that are expected to close later in the year,” according toJason Wolf, founder and principal of WCRE.

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There were approximately 310,493 square feet of new leasesand renewals executed in Burlington, Camden, and GloucesterCounties during Q2, including several large spaces, ranging insize from 6,000 to 44,000 square feet. New deals andexpansions accounted for 52% of all transactions.

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WCRE says there was net absorption of 112,368 squarefeet.

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“Vacancy rates continue to fall, and conditions in our regionhave improved to the point where we expect to see them fall evenfurther,” Wolf said. “We're seeing lower unemployment, includinggains in office jobs, and a general boost in small businessconfidence, which is fueling expansion.”

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The report noted that for the second straight quarter, manyof the subject properties were located in prime locations withinBurlington County, and suggested that market tightening in thatareas was causing demand to shift toward vacancies in CamdenCounty.

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Other highlights from the report:

  • Both Burlington County and Camden County saw significantdecreases in vacancy this quarter, though Burlington continued tomaintain a much lower vacancy rate than Camden, at 9.1%compared with 18.1%.
  • Average rents for Class A & B product were in the range of$11-$14 per square foot for triple net or $21-$24 per square footgross.

Retail

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WCRE also reported on the local retail market, where the news isquite bright for Center City Philadelphia, but less so for SouthernNew Jersey. Several major retailers are moving into large CenterCity spaces, including Nordstrom Rack, Forever 21, and AmericanEagle Outfitters.

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Southern New Jersey gained a new Whole Foods and ground wasbroken for an outlet center in Deptford, but there are sometroubled centers amid others only beginning to grow, the reportsays.

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Overall retail vacancy in the tri-county area is at 15.7%, upfor the second straight quarter.

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