In a State that loses more of its population each year than any other State in the entire Country, you need to look behind the curtain to understand what is unique about New Jersey in 2025?

          While Jersey is a really small sized State with a very dense population, it is the largest suburb in the U.S, with New York City to the North and Philadelphia to the South.  It has 564 diverse municipalities where home-rule gives each one the right to create its own zoning laws.  Because of this New Jersey has the misunderstood reputation of being a very unfriendly place for new development.

In spite of these challenges, New Jersey today has over 400 million square feet of office space and almost 2 billion square feet of industrial space.  It is located 60 miles from one-third of the entire population of the U.S., making the Garden State ground zero for warehouse distribution.

The majority of the office space in New Jersey was constructed back in the 1970’s and 1980’s during the office park boom.  It was a perfect storm of no-money-down lending practices just when the US economy was transitioning to a new service economy.  The challenge today is how to keep the aging inventory relevant.

So, what is the good news about New Jersey?  It is 5 years since Covid, and companies have finally figured it out.  Most companies have now fully transitioned to full-time or hybrid work and are once again making long-term leasing decisions. There are around 25 percent of companies working full-time, mostly in the medical and financial industries. Other companies like Pharma and Tech have settled on a hybrid work model, with open space designs and more huddle spaces.  Of course, there are around 25 percent of companies that have made the decision to work from home forever.

What does all this mean for developers?  In the wake of the storm, we are now able to distinguish the winners from the losers. Some Landlords are doing rather well with high occupancy rates.  What is not being reported is that behind the scenes many Landlords have suffered bankruptcies.  We see an unprecedented number of properties being auctioned by companies like TenX.

Tenants have today transitioned into two camps.  The more stable companies are looking to secure long-term leases, in spite of the high cost of new construction.  Those companies, unwilling or unable to make long-term commitments, are left with short term leases where they are forced to fit within existing spaces, unable to amortize layout changes or revisions.

In summary, the good news as I see it is that the uncertainty is over and companies that were wondering how they were going to survive a few years ago are today back in the game.  For those of you that are back in the game, we at Dickstein Real Estate Services are changing the game for our customers.  For advice on how to play to win, why not give us a call to find out why, at Dickstein Real Estate Services, OUR DIFFERENCE IS YOUR ADVANTAGE®.

Regards,

Lawrence Dickstein

Dickstein Real Estate Services