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How hot is the New Jersey office market? Record rents are on the horizon (currently averaging $22 a foot, but hitting the mid-$30s in prime locations) and availability is rushing toward single digits (currently in the 12% range, according to most estimates, but mostly in small blocks and in class B and C space). In the northern and central regions, which make up half of the Garden State’s land area but three-quarters of its population and constitutes the country’s fourth largest real estate market, absorption in the office market was almost 1.3 million sf in the first quarter of 2000 alone, according to a new report by Newmark & Co. Real Estate of New Jersey.

“We can’t build the space fast enough,” legendary metro area developer and New Jersey waterfront savior Sam LeFrak tells GlobeSt.com. Indeed, most spec properties are finding a major tenant-often for the entire building-within weeks after their announcement.

“The Northern New Jersey office market is as tight as it’s ever been,” comments Seena Stein, president of Newmark-NJ, Rutherford. “The waterfront is leading the way-leases are out on the next two buildings to be built at Newport Office Center and major corporations are fighting for space in future buildings.”

Those next two buildings would be Newport V and VI, which have now been substantially pre-leased by Chase Manhattan Bank (see earlier story). In any case, “activity is actually creating great opportunities elsewhere in New Jersey,” says Stein.

“In general, the brokerage community is a little overwhelmed and frustrated by the lack of space in the market,” concedes Stein, who was named one of the 13 most powerful people in NJ real estate in the June issue of Real Estate New Jersey magazine. “These days, if you have a 100,000-sf tenant, the options are extremely limited.”

Among the largest lease transactions in Northern and Central NJ so far this year, besides the 1.1 million sf that Chase is taking at Newport Center: Compaq Computer Corp., 123,082 sf in Murray Hills; Warner Lambert, 115,517 sf at Morris Corporate Center, Parsippany; Dow Jones, 92,000 sf at Harborside Financial Center, Jersey City; Novo Nordisk, 79,000 sf, Princeton; Electronic Data Systems, 75,000 sf in Morris Plains; and Allied Office Supplies, 60,000 sf in Clifton.

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