The South Jersey office market saw an unexpected bump to end the year, despite concerns about Hurricane Sandy and federal policy that have threatened economic growth across the region, according to a new market report by a Voorhees-based brokerage firm.
The fourth-quarter analysis by Wolf Commercial Real Estate showed “a significant uptick” in new leasing and expansion, the firm said in a news release. The market of about 17 million square feet recorded some 235,000 square feet of new deals and expansions, and 389,000 square feet of leasing overall, a 25-percent jump from the previous three months.
Like other markets, South Jersey was fed with uncertainty by Hurricane Sandy, the presidential election and the threat of automatic tax hikes and spending cuts to start the year. But Jason Wolf, founder and principal of the firm, said those factors “exerted pressure on businesses, investors and consumers, (but) there were signs of accelerated growth and reasons for optimism amid the overall climate of cautiousness.”
The 235,000 square feet of new leasing and expansion in the market was more than double the third-quarter total, the firm said. All told, the strongest submarkets in the fourth quarter were Mooretown, Marlton and Mount Laurel, while Voorhees, Pennsauken and western Cherry Hill continued to struggle with large vacancies.
However, Wolf noted some hurdles in store for 2013, as major tenants like Lockheed-Martin and Catalent Pharma are planning to downsize, adding at least 250,000 square feet of vacant space to the market. He also said that could be positive because large blocks of space have become scarce in South Jersey.
A separate fourth-quarter report by Colliers International said that southern New Jersey had “a turnaround year” in 2012, recording a full-year uptick in total occupied space for the first time in three years. Total vacancy for the market ended the year at 14.9 percent, down from 15.2 percent at midyear.
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