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PARSIPPANY, NJ-The Northern and Central New Jersey office market continues to be generally positive, but as economic growth has slowed in the state, companies may have become hesitant on hiring, causing a slowdown in the market heading into Q4. That’s the gist of a Q3 market report just issued by GVA Williams of NJ, based here.

“Many tenants are still positioning themselves, staying in the market 12 to 18 months before making deals, often resulting in sporadic activity,” says Matthew J. Dolly, the firm’s director of research and marketing. “But the life sciences and telecom industries are regaining strength, and mission-critical data requirements continue to be active in New Jersey.”

Overall, vacancy rates ticked up slightly during Q3, to 17.64% from 17.36%. But that number is still down significantly from 18.89% at the end of Q3 of 2004. Six of the 10 counties surveyed experienced a continued decline in direct space vacancy, and seven of the 10 saw a drop in sublease space over a year ago.

Asking rents rose slightly year-to-year to the current $24.23 from $23.83. Since Q2 of 2005, rents in North Jersey rose to $24.54 from $24.39, but declined in Central Jersey from $23.84 to $23.67.

“Generally speaking, there are still many options for tenants surveying the market, especially those with smaller requirements,” Dolly says. “The good news for landlords, however, is that the availability of high-quality large blocks of space has diminished, especially in Morris and Mercer counties, resulting in new product being introduced to the market for the first time in recent memory.”

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