December 7, 2018
New Jersey has transformed into an office market characterized primarily by small office deals below 10,000 square feet, says CBRE.
Last year marked a five-year low in the number of large-size transactions, and given leasing activity through the third quarter, 2018 is likely to see the total number of big leases decline even further. One byproduct has been an overabundance of large blocks of space.
Conversely, the number of small transactions has been on a strong upswing since 2013 and shows no sign of abating. As Q3 ended, the total number of small leases in 2018 had already reached 581, surpassing the previous year-end total and setting a new high-water mark.
“The combined impact of too many large blocks and not enough large-block demand suggests that the market is likely to see the current availability and rent levels persist,” said Rémy P. deVarenne Jr., SVP, CBRE. “Changing the trajectory of the market will require reducing the oversupply of space and realigning available inventory to better meet the demands of current and future tenants in the market.”
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