Page 20 - RE-NJ

18 JANUARY 2024
SPECIAL ADVERTISING SECTION
MARKET FORECAST
TM
GREGORY J. DEMARCO, PE
PRESIDENT
We saw an uptick in the fourth quarter of 2023 for commercial real estate projects heading into 2024. I believe the market is already moving on projected interest rate decreases and projects are freeing up that were previously on hold. Health care is strong and continues to be a robust market. Pharmaceutical R&D is right alongside health care and there is an uptick in medical office buildings, or MOBs. Also, major online suppliers continue with warehouse development.
Adaptive reuse continues. Interesting in the commercial sector is the renovation of office space into smaller “white box” areas. Many of the landlords we’re working with are going in with the approach of “move-in condition.”
Different from 2023 is a big uptick in data center design throughout the region. Core infrastructure and power redundancy are major factors. I attribute this in part to e-commerce growth. Financial institutions are also upgrading and expanding their data centers.
Employee recruitment remains a challenge in the STEM sectors. Overall, I see 2024 as a strong year.
(732) 438-1655 [email protected]
www.therockbrook.com
20 South Middlesex Ave., Suite B Monroe Township, NJ 08831
BRIAN FOLEY
PARTNER, ORIGINATIONS,
DUE DILIGENCE AND BUSINESS DEVELOPMENT
The real estate industry in the tristate area has been tricky to navigate the past 12 to 18 months — rising rates, inflation, supply chain, labor shortages ... the list goes on and on. “Survive to
’25” has been the poster child slogan across the board. Luckily, we may see a little reprieve in 2024, which a few weeks ago seemed impossible.
Fed Chair Jerome Powell has finally announced a few rate reductions are likely on the horizon, and immediately it feels like we can finally come up for air. As a lender, it has been tough,
but on the bright side, we are finally weeding out the weaker deals in the marketplace with undercapitalized partnerships. Unfortunately, the cost overruns and high rates are making it near impossible to get out of the construction loans written the past five years. Good deals are out there, but it is like finding a needle in a haystack. Capitalized partners and borrowers will be the key to success over the next 12 months.
(201) 871-1177 [email protected]
www.procida.com
570 Sylvan Ave. Englewood Cliffs, NJ 07632
WILLIAM C. HANSON, SIOR
PRESIDENT
During the past year, we have seen industrial pricing plateau across northern New Jersey after the pandemic-driven frenzy of 2020 to 2022.
As we enter 2024, continued increased availability of sublease space, a pullback from large single-tenant users and the delivery of new industrial spaces that began construction at the height of the market will drive up availability and place downward pressure on pricing. Rather than a cause for concern, this reflects a return to more normal market conditions and we are confident it will create a healthier market in the long term.
Looking even further ahead, the market will absorb the new construction, albeit at a much slower pace than before. As the new construction pipeline lags due to a challenging financing environment and public backlash to new development, the market will promise opportunities for patient and creative investors and owners.
(201) 488-5800 [email protected]
www.naihanson.com 195 North St., Suite 100 Teterboro, NJ 07608
MATTHEW HARDING
CEO
Commercial real estate owners are focused on positioning assets for maximum performance, leveraging leasing velocity to take advantage of expansion potential and reposition existing GLA. This translates to a busy time for integrated third-party services providers that offer a full suite of services including leasing, management and construction management. For example, this year Levin Management spearheaded the ground-up construction of two industrial buildings to expand Rutgers Industrial Center, an established campus in Piscataway. Both buildings were leased prior to their completion. On the retail front, we recently launched a major redevelopment at Blue Star Shopping Center
in Watchung, which was catalyzed by an in-center relocation and new, 72,000-square-foot lease with ShopRite. Throughout the state, our clients are moving forward with pad site developments and tenant fit-outs at open-air shopping centers, which continue to outperform other retail asset types. We expect this momentum to continue in 2024.
(800) 488-0768 [email protected]
www.levinmgt.com
975 Route 22 West
North Plainfield, NJ 07060