WCRE cautiously optimistic about South Jersey commercial real estate

The commercial real estate brokerage WCRE reported in its analysis of the second quarter that the Markets in southern New Jersey and southeastern Pennsylvania are cautiously entering the post-pandemic recovery. Although problems remain, commercial real estate appears to be recovering along with the overall economy.

That said Jason Wolf, founder and managing director of WCRE, a commercial real estate brokerage firm that covers the South Jersey and Philadelphia markets.

“Fundamentals are moving in a positive direction and while various challenges remain, conditions exist that point to a return to pre-pandemic commercial real estate performance,” he said.

In the three counties studied (Burlington, Camden, and Gloucester), approximately 233,544 square feet of new leases and renovations were completed. And while that number doesn’t suggest a recovery, it marks the return of net positive absorption, Wolf said.

Tenant new leases comprised approximately 123,358 square feet, or approximately 53% of all deals for the three counties. In the previous quarter it was only 8% of the total.

Highlights of the South Jersey office market:

  • The total vacancy rate on the market is now around 13.6 percent, practically unchanged compared to the previous quarter and consistently two points higher than at this point in the previous year;
  • With 1,257,385 square meters, the sales market actively picked up speed on the market or in consultation;
  • Average rents for Class A and B products remain unchanged as they continue to show strong support in the $ 10-15 / sf NNN or $ 20-25 / sf gross range for deals closed in the quarter. These averages have been near this range for more than a year.

South Jersey Retail Market Highlights:

  • The consumer confidence index has risen steadily since its turnaround in February.
  • Camden County’s retail vacancy rose more than three points to 14.3 percent after seeing a sharp rise in mid-2020. While average rents rose by more than a dollar, rents hovered around $ 12.86 / sf NNN.
  • Burlington County’s retail vacancy fell 9.6 percent, an improvement of more than three-quarters of a point. But it is still well above 7.6 percent where it was a year ago. Average rents rose slightly to $ 14.59 / sf NNN.
  • Gloucester County saw another quarterly increase to 16.5 after rising over the past year, with average rents practically unchanged at $ 14.08 / sf NNN.