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Q1 2022 New Jersey Office Market Report

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The lack of large transactions slowed leasing activity in Northern and Central New Jersey during the first quarter of 2022 to 2.3 million square feet (MSF).

While this figure is up slightly from the post-pandemic average, activity is down 9.0% from the three-year pre-pandemic quarterly average of 2.5 MSF.

Demand was fueled by mid-sized transactions and not the large new leases needed to significantly reduce the availability rate. This, combined with the continual return of large blocks of space to the supply, stalled positive movement and caused net absorption to turn negative for the eighth time over the last nine quarters. The top five blocks of newly available space alone returned 487,000 SF to the market, leading to 29,566 SF of negative net absorption, which kept the availability rate from improving, remaining at 22.4% for the second consecutive quarter. The average asking rent increased slightly, up 1.5% year-over-year to $29.29/SF as upward repricing resumed in newly updated buildings within transitoriented submarkets.

The office market seemed to turn a corner during Q4 2021, as large transactions lowered the availability rate for the first time since the onset of the pandemic. However, the 2.3 MSF of leases were not enough to offset the accumulation of several new subleases and direct space that returned to the market. As such, the availability rate remained unchanged at 22.4% and net absorption totaled negative 29,566 SF.

 

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Q1 2022 New Jersey Office Market Report

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Felix Soto

Research Manager

Woodbridge

Felix joined Colliers International in 2014 as a Research Analyst in the Parsippany office.  Felix assists in gathering and providing market data, as well as assisting brokers in completing various research requests.   

Prior to joining Colliers, Felix worked as a Habilitation Counselor for Rutgers Biomedical and Health Science, where he facilitated and developed multidisciplinary treatment plans with case management clients.  While at the University, Felix provided crisis outreach to assist in recognizing and intervening in potential crisis situations.  Felix moved on to become a Site Manager at Easter Seals of New Jersey, where his primary focus was ensuring services were in compliance with all licensing, policies, and providing utilization and statistical information to achieve financial sustainability. 

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