E-Commerce, other developments spur continued growth in Northern New Jersey’s industrial market
The continuing growth of e-commerce — which accounted for $119 billion of sales in the fourth quarter of 2017 alone, according to the U.S. Department of Commerce — is helping to drive demand for industrial/warehousing facilities in Northern New Jersey while shaping design requirements for new construction.Warehousing and distribution activity in general has already benefitted from strong brick-and-mortar sales for consumer products, apparel, food and other categories. The increased e-commerce activity has further propelled demand for distribution and “last-mile delivery” facilities that offer easy access to major population centers. The desirability of Northern New Jersey submarkets — including the Meadowlands and other locations along the New Jersey Turnpike, and the I-80 and I-287 corridors — is enhanced by their proximity to markets like New York City, Long Island, Connecticut and Westchester. The submarkets’ nearby road, water and air facilities also make it easy for warehouse-distributors to ship goods to virtually any national or global destination. Even with new projects coming on line, increasing demand has spurred absorption, forcing would-be tenants to act quickly. Those who hesitate risk missing out on their first-choice properties as single-digit vacancy rates, averaging 4% to 5% in Northern and Central New Jersey, spur rents to double-digit levels ($12 to $13 psf in some cases) for desirable facilities. The e-commerce component of today’s demand for space is also driving design changes as tenants seek larger facilities.