NJ Industrial Leasing Sees 5.8M SF Leased in Q2

In the second quarter, Northern and Central New Jersey's industrial leasing market demonstrated remarkable strength. A Cushman & Wakefield report highlighted a significant increase in activity, with 5.8 million square feet (msf) of new leases, marking an 11.2% year-over-year growth. Despite a rise in the overall vacancy rate to 7.6%, the market's resilience is evident. Class A industrial properties particularly thrived, experiencing 1.4 msf of positive net absorption, underscoring robust demand.

Office Leasing Slowdown

Contrasting the industrial sector's performance, office leasing in the region faced a downturn. The second quarter saw no new leases or renewals exceeding 100,000 square feet, contributing to a high vacancy rate of 23.2%. Despite these challenges, the preference for high-quality office spaces persists, even amidst substantial consolidations and an increase in available sublease space.

Expert Insights

John Obeid, senior research manager at Cushman & Wakefield, emphasized the industrial market's resilience. He noted the strong leasing activity and significant construction completions, despite the overall rise in vacancy rates. The positive net absorption in Class A industrial properties highlights continued demand for premium logistics spaces.