Page 18 - RENJ June 2021

16 JUNE 2021
EASING BACK
With return to work on the horizon, apartments in transit hubs show signs of a rebound
Areturn to the office could help bring commuters back to
urban employment hubs such as Manhattan, lifting the market for transit-centric apartments in northern New Jersey.
At least that’s the hope of multifamily owners and developers in the region, who already see a rebound in activity as employees transition back to the workplace at least part of the time. Industry leaders say that shift is now taking place in locales such as the Hudson waterfront, where occupancy and net effective rents suffered at the height of the pandemic.
“People realize they’ve got to go back to the office,” said Jeff Dunne, a vice chairman with CBRE and leader of the firm’s tristate capital markets team. So apartments that are within walking distance of mass transit are “seeing a spike in leasing activity” from renters who had fled to the suburbs or to a location hundreds of
miles from where they work.
By Joshua Burd
several topics, the panelists said the
Systems’ data on key fob swipes in its portfolio. That points to a steeper climb for office occupancy in the region, especially given
the uncertainty over hybrid work schedules.
Still, Kisia noted that mass transit usage across the Hudson River showed slight upticks during the pandemic’s calmer stretches, such
as last summer, showing commuters’ willingness to board a train when cases weren’t spiking. To be sure, average daily ridership at New Jersey PATH train stations has ticked up in recent months, from nearly 26,000
in January to about 35,000 in April, although still far below pre-pandemic levels of 118,000.
“There is a substantial opportunity for some mode shift to occur, just given the size of those numbers,” Kisia said, noting that mass transit accounted for about 80 percent of all commutation across the Hudson, pre-pandemic.
“Now that they have to come back to their office at Penn Plaza, Grand Central or wherever it is, they’re
market for luxury apartments near mass transit was showing signs of a recovery as companies prepare to reopen their offices.
It remains to be seen how quickly that will happen and to what degree. Duncan Kisia, the Port Authority
of New York and New Jersey’s lead economist
and assistant
director for
planning
and regional
development,
said that office
usage fell much
more sharply in
dense, transit-
rich cities such as New York than
in those that are more reliant on automobiles. Estimated occupancy in the region was still less than 15 percent as of March 1, he said, citing the building security firm Kastle
Jeff Dunne
looking more seriously at these train- oriented buildings,”
he added. “We’re selling
a number of them and we’re seeing those
occupancies go up, and we’re seeing really good leasing activity right now in that space because ... that message is getting out.”
Dunne spoke in late May at NAIOP New Jersey’s Mid-Year Economic & Markets Outlook, moderating a panel discussion on how commercial real estate would fare as vaccinations become more widespread and as the COVID-19 crisis subsides. In one of
Duncan Kisia
Industry experts say a return to the office could help bring commuters back to urban employment hubs such as Manhattan, lifting the market for transit-centric apartments in Hudson County and elsewhere in northern New Jersey.