Veris Residential Seals $85M Deal for Harborside 5 Office Tower in Jersey City's Waterfront District

Veris Residential has finalized the sale of Harborside 5, a sprawling 1 million-square-foot office tower situated in the heart of Jersey City, N.J., signaling a major shift for the company into the multi-family real estate investment trust sector. The transaction, which commenced a month ago, saw 601W Cos. acquiring the property for a reported $85 million. This acquisition was made possible through a $65 million first-mortgage senior acquisition loan extended by Northwind Group, with $45 million allocated towards the purchase and the remainder earmarked for a strategic and enhancing leasing program.

An Opportune Transition

Veris Residential's strategic investment move not only marks a significant shift in their real estate portfolio but also signifies a bold step into the competitive realm of multifamily real estate investment trusts. With Harborside 5 now under the ownership of 601W Cos., a new chapter unfolds for this iconic office tower, poised to evolve and thrive under fresh management and vision.

The Tale of Revitalized Properties

A transformative journey unfolded with the recent acquisition of Harborside 1, 2, and 3 in a substantial $420 million transaction last year by 601W Cos. Originally established as industrial structures in 1929, these buildings underwent a noteworthy conversion into office spaces in 1982, marking a shift towards modern functionality and purpose. The current owner wasted no time and has already commenced enhancing these properties to elevate their appeal and functionality.

Harborside 5: Modernization in Progress

In the year 2002, the 33-story Harborside 5 stood tall, serving its occupants with pride. A recent cosmetic makeover in 2018 breathed new life into the building, aligning it with contemporary aesthetic standards. Featuring expansive floorplates averaging 87,500 square feet, the property also offers around 9,500 square feet of retail space, enriching the overall experience within its premises. Among the notable tenants, Regus and Hudson Cove stand as pillars of the property’s vibrant community.

Exploring Jersey City’s Vibrant Waterfront

An office tower situated at 5 Harborside Plaza in Jersey City offers a prime location within the bustling waterfront district of the city, providing easy access to downtown amenities. Furthermore, its proximity to the Exchange Place PATH train and ferry stations enhances connectivity for commuters.

Shifts in New Jersey's Office Space Market

In 2023, the New Jersey market witnessed a significant real estate turnover with over 9.3 million square feet of office space changing ownership through 61 transactions, amounting to a total investment exceeding $1.2 billion, as reported by CommercialEdge. This marks a notable decrease compared to the previous year, where 121 assets exchanged hands totaling nearly $3.4 billion.

Market Dynamics Unveiled

Entering the closure of 2024's initial quarter, the metropolitan area has witnessed a flurry of 10 significant office transactions totaling a substantial $212 million. Notably, the illustrious Harborside 5 emerged as the pinnacle of these property exchanges, marking a notable shift in the commercial real estate landscape.