May 2, 2016
Limited industrial supply, combined with huge demand, has led to skyrocketing rents, according to Transwestern’s 1Q 2016 market report. Overall, asking rents exceeded $6 per square foot for the first time since 2008. Additionally, first-quarter rents were 20% higher than 2011’s post-recession low.
Transwestern points out that e-commerce is spurring more demand for space, and will continue driving the market along the New Jersey Turnpike and near the ports. Logistics and distribution users are expanding; the average market tenant requires more than 250,000 square feet.
“As demand continues to grow, limited supply of buildable land is causing buyers to turn their attention to redevelopment, hoping to position obsolete product for higher and better use,” Transwestern’s New Jersey Research Director Matthew Dolly said. “Developers are also seeing opportunity to upgrade existing industrial properties.”