The brokerage team at Pierson Commercial includes (from left) Neil Ruppert, broker; Ryan Starkman, broker; Jason Pierson, president; Gary Krauss, broker; and Gregg Medvin, vice president. — Courtesy: Pierson Commercial
By Joshua Burd
Jason Pierson has seen it in cities across the country: Arenas and entertainment venues are often “the epicenter of the market” when it comes to attracting clusters of retail and restaurants.
He believed the Prudential Center held that same potential for downtown Newark soon after it opened in 2007, a belief that was strengthened about six years later, when he saw the success of operators in the surrounding blocks like Dinosaur Bar-B-Que and The Green Chicpea.
“That, to me, meant that there was a market there,” said Pierson, the founder and president of Pierson Commercial. “So when we would do tours with our tenants, we would show them how well they’re performing and how great the environment was — and that these are real legitimate operators and that real consumers were visiting and patronizing these establishments.”
The experience in Newark has been critical to Pierson and his retail brokerage firm, which has gained a foothold in some of New Jersey’s largest and best-known cities. Founded in 2011, the firm has also represented tenants and owners in New Brunswick, Elizabeth, Jersey City, Atlantic City and other major urban markets, along with local urban markets in which Pierson sees continued upside.
The Englishtown-based firm has flourished from that expertise, while remaining just as active in the suburbs and highway retail corridors. Pierson Commercial has more than doubled its number of listings since 2015, to about 45, while it now represents around 15 national and regional tenants.
It’s why Pierson continues to be bullish on retail in the Garden State.
“If you’re dealing with real estate managers or developers from out of state, they know how desirable New Jersey is,” he said. “It’s the third-wealthiest state in the country, it’s the most densely populated per capita, (with) very high sales volume.
“Some of the best markets in the country are Clifton and Paramus — arguably the best in the country — by sales volume. The people that are in the know in the real estate world know that it’s a very fruitful market.”
Pierson said he sees potential in both urban and suburban markets, which are both increasingly focused on restaurants, amenities, fitness, cafés and convenience. And he pointed to the growing residential pipelines that will create demand in many cities. In the suburbs, he noted the abundance of big-box spaces that have been vacated by chains such as Sports Authority and Pathmark — often at lower rental rates — which are being absorbed by new so-called experiential users.
While the firm today is split just about evenly between tenant and landlord representation, that wasn’t always the case. Early on, Pierson said, the business was slanted toward representing operators such as AT&T, Burger King and Qdoba Mexican Eats.
That work ultimately brought him to Newark, where he saw the benefits of the city’s infrastructure, daytime population, the Prudential Center and other attributes, along with the value that could be realized in the wake of the downturn. Pierson also pointed to the growth of state incentives at the time, which meant that mixed-use developers could offer discounted rates of 30 or 40 percent because they had financing to cover the cost of tenant improvements.
Investing his time in Newark began to pay off in 2015 and 2016, when the firm brought Starbucks and Qdoba to the Shoppes on Broad, part of a redevelopment by Prudential Financial. Pierson is excited to see both stores doing well, he said, and he believes those clients and other retailers will soon benefit from a growing residential pipeline in the city, which includes some 10,000 apartments. Those new residents will augment what is already a robust daytime population of workers, rewarding those that came to the city earlier in the cycle.
“They’re pioneers at this point,” he said. “And the fact that they could get in at a discounted rate compared to the suburban markets — they go in recognizing that and running their pro formas based on a five-day-a-week market with the opportunity two years down the road, seeing that these markets are now maturing.”
Pierson also cited the growth of national and regional operators in Newark, starting around 2012, five years after the Prudential Center opened downtown. Dinosaur Bar-B-Que opened that year, paving the way for more than 15 other chains to open from 2013 through 2016. That pace grew even faster when more than a dozen others opened in 2017 alone — including Whole Foods, Planet Fitness and CityMD — and is slated to continue this year.
“That’s just the reflection of the market and them understanding sales volumes and how people are performing,” Pierson said. “So they wouldn’t be doing this if other people aren’t performing well in the market.”
The firm — which now has a team of four brokers besides Pierson — now represents several owners in the city, including Paramount Assets and Edison Properties. The latter hired Pierson recently to market the ground-floor retail and restaurant space for Ironside Newark, a project in which it’s converting a 107-year-old warehouse along McCarter Highway into a modern loft-style office building.
The team recently picked up another high-profile assignment in the city, this time at Hahne & Co., a historic department store building that was rehabilitated into new apartments and commercial space. Pierson is representing L+M Development Partners at the property as it markets more than 14,500 square feet along Halsey Street.
The firm’s focus on Newark and urban markets was a key driver for one of the firm’s earlier hires, Ryan Starkman, who joined in spring 2014. It’s also an example of hiring for a specific niche, which Pierson said he prefers over simply trying to add brokers to drum up new business.
“That’s the key thing — everybody needs a niche,” Pierson said. “There’s plenty of pie out there for our company and everybody else in the business. But we try to identify where there are opportunities and where there’s not a lot of coverage — and there are plenty of them — and then we focus on that and we spend a lot of time on training and making that a priority.”
He says the firm is equally deliberate when it comes to taking on new tenant requirements.
“We’re not just looking to bring on any account,” Pierson said. “We qualify them — we really want to make sure that it’s the right fit for us, we want to make sure that culturally we align with them and that we know that they’re actually serious about expanding.”
Pierson, who spent three years with CBRE before launching his own firm, first added to his team in 2012 with the hiring of Gregg Medvin. They are part of what is now a five-person brokerage team that also includes Starkman, Gary Krauss and Neil Ruppert, and an overall staff of nine.
Building that team has coincided with the growth of Pierson’s client list, which now includes some of New Jersey’s most prominent developers. For instance, New Brunswick Development Corp., or Devco, hired Pierson Commercial in 2015 to lease 14,000 square feet of retail space at the project known as The Yard @ College Avenue.
Touting the appeal of New Brunswick’s education and health care anchors, along with new residential projects, the firms have collaborated to attract a roster that includes Jersey Mike’s, Honeygrow and Starbucks. For Pierson, it was a prominent project and “a telling tale for our capabilities,” which has led to new assignments from not only Devco, but other high-profile owners in other urban and mixed-use suburban settings.
The firm has also represented the likes of Sharbell Development in Robbinsville, BNE Real Estate Group in Aberdeen and Jacobs Enterprises in Elizabeth, among several other urban and suburban owners.
“Repeat business is a very good compliment of how you performed — and developers like to see that you’re working for other major developers and that you’re succeeding with them,” Pierson said. “And when you do, it gets your foot in the door.”
Pierson Commercial is now representing Atlantic City Development Corp., a Devco affiliate, in marketing some 7,300 square feet of available retail space at the Atlantic City Gateway project. The space will be part of an overall 675,000-square-foot, mixed-use project that will include a new campus for Stockton University and an office building for South Jersey Industries.
After many down years for the resort town, Pierson feels there is now great momentum, noting that some operators from Asbury Park are looking to expand into Atlantic City. He also pointed to the recent arrival of one of the hottest names in experiential retail, Topgolf, which has opened an 11-bay “Swing Suite” in the Ocean Resort Casino and now provides another entertainment option for visitors to the city.
Along with Ocean Resort, Atlantic City is also celebrating the debut of the Hard Rock Hotel & Casino at the former Trump Taj Mahal. Pierson believes the new casinos, combined with the addition of a nongaming project such as the Gateway, will provide the catalyst that can attract some pioneering retailers and pave the way for additional growth.
“All you need is one or two things to kick-start the market and for people to get in at the ground level,” he said. “Now is the time to do it.”
Pierson recalls starting as a real estate broker in 2008 “when I had no business and I had no relationships.”
That made it all the more important for him to get involved in an organization like the International Council of Shopping Centers — the main trade association for retail real estate — prompting him to join its Next Generation group and make new connections.
In recent years, he has ramped up the firm’s involvement in ICSC. Pierson in 2016 joined the association’s government relations committee, with a focus on public-private partnerships, and now plays an active role in the industry’s effort to reform the state’s liquor licenses laws.
“For me, it’s important for our business and our firm — and for the brokerage community — to have relationships on the municipal and state level,” Pierson said, noting that expanding the liquor licenses would be a boon for small businesses and mixed-use projects.