According to JLL Research, the following at the key highlights of Q4 2015:
Employment growth on pace for biggest gain in 15 years
After adding less than 30,000 jobs in 2014, the New Jersey employment market registered signs of growth during the past year. With the exception of a brief downturn during June and July when 23,000 jobs were shed, the New Jersey employment market posted monthly job gains in 2015. With 7,900 jobs added in November, approximately 55,000 jobs have been created in the Garden State since the beginning of the year. This represented the largest gain since 78,400 jobs were created in 2000. Accelerating gains in the employment market will help to position the office market on the road to recovery in the coming year.
Class A vacancy rate slides to lowest level since mid-2013
Class A space emerged as the product of choice for office users during the past year, as companies increasingly promoted their Class A work environments to help retain as well as recruit new employees. After registering 691,500 square feet of negative net absorption during 2014, rebounding demand led to nearly 1.4 million square feet absorbed in the Class A office market one year later. The Class A vacancy rate declined one percentage point from 2014 to 24.1 percent – its lowest level since mid-2013. This was in contrast to the 1.1 million square feet of negative absorption witnessed in the Class B office market, where the vacancy rate approached 26.0 percent – its highest level in three years.
Broad spectrum of commuting options attract tenants to Metropark
Since nearing 25.0 percent in 2014, the Metropark Class A vacancy rate trended lower during the past year in the wake of persistent leasing velocity. One year later, the Class A vacancy rate had fallen below 19.0 percent, which represented the lowest vacancy rate in Central New Jersey. Among the largest transactions recently signed in this submarket involved the New Jersey Turnpike Authority’s leasing of the 205,000-square-foot former Hess headquarters building in Woodbridge. The Turnpike Authority will be relocating its operations from 581 Main Street, also in Woodbridge. With its superior highway access and commuter rail service via Metropark Train Station, this submarket is poised to remain on the radar screen for office tenant requirements.