By Joshua Burd
Industrial vacancy in northern New Jersey rose again in the fourth quarter, as new construction continues to weigh on the market alongside growing sublease space and other factors.
A report by NAI James E. Hanson, the real estate services firm, found that overall vacancy grew steadily during 2024 and closed the year at 6 percent. That’s up from 4.7 percent at the end of 2023, as developers in the region completed nearly 12 million square feet of new space during the year.
That includes 9.5 million square feet that was delivered vacant, the report found, while citing other potential headwinds. It also pointed to signs of potential relief on the horizon.
“The New Jersey industrial market continued to be impacted by sustained deliveries of new product throughout 2024,” NAI Hanson wrote. “Available space in new construction has kept absorption in negative territory over the last seven quarters. In addition to offerings from new construction, the amount of sublease space rose throughout the year, reaching a historical high.
“Vacancy rates have risen and the time to complete deals has lengthened as a result of the changes in the market. Sustained demand from logistics and distribution firms and 3PL companies have helped to temper the rise in vacancy. Looking ahead, the level of expected deliveries drops sharply after 2025, but until then the market could be affected by potential tariffs and a possible disruption to the supply chain.”
Even so, the report noted that asking rents remain stable in most submarkets across northern New Jersey. The top submarkets include the Meadowlands and the Port Newark-Elizabeth region, where average asking rates in Q4 were $16.01 and $15.98 per square foot, respectively.
Tenants leased just under 949,000 square feet in Q4 and about 9 million square feet for the year, NAI Hanson reported. According to the Teterboro-based firm, the state’s largest industrial deals of 2024 included LeCangs’ 845,280-square-foot commitment at 1900 River Road in Burlington Township and eLogistek’s 806,000-square-foot deal at 1183 Florence Columbus Road in Mansfield.
