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Industrial Tenants Set Their Sights West of Turnpike
Although the New Jersey Turnpike corridor remains the epicenter of the state’s industrial market, and especially the Exit 8A submarket, activity is beginning to expand to submarkets farther west, according to Transwestern. This occurred most notably in the Route 46/23/3, Fairfield and Morris East submarkets, with leasing in non-Turnpike submarkets representing 27% of total year-over-year net absorption.
“As the best product in the primary corridors becomes scarcer, corporate tenants are expanding their geographic parameters to find more options,” said Lori Zuck, Transwestern managing director. “However, these secondary submarkets have also tightened, pushing rental rates as much as 25% to 35% higher in the past few years.”
Leasing west of the Turnpike in recent quarters has been dominated by the Route 46/23/3 submarket, according to Cushman & Wakefield. This included a 418,000-square-foot commitment by Gucci in Wayne, and Corbion’s 391,515-square-foot deal at AEW Capital Management’s 700 Union Blvd. in Totowa (pictured).
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