WOODBRIDGE, NJ-Commercial real estate in New Jersey is holding reasonably steady, according to new 3Q figures issued by the Garden State’s office of Julien J. Studley Inc., here. Space availability and rents were both virtually unchanged from the previous quarter – which may be a good sign.
The overall availability for office space came in at 16.5%, compared to 16.4%, and class A office space actually dropped a bit, from 18.1% to 17.9%. Rents, similarly, barely moved, with overall asking rents dropping by just 3 cents a foot to $24.46. Class A rents decreased by just a penny a foot to $26.51.
One ominous note, however, is that “the leases on approximately 4.4 million sf of the market’s 11.7 million sf of sublease space will expire by 2005,” according to a Studley spokesman. “This will have a substantial effect on the bottom line for building owners. The market could resemble conditions seen in the late ’80s, when overbuilding swamped the state with empty office property.”
“Unless the economy rebounds, the impending conversion of millions of sf of sublease space to direct space may soon force building owners to become more proactive,” the spokesman concludes.