A view from Journal Squared in Jersey City — Courtesy: KRE Group/Qualls Benson
By Joshua Burd
If recent moves by Google and Amazon are any indication of what’s to come in Manhattan, the residential market on New Jersey’s Gold Coast could be among the biggest winners.
Technology professionals already account for a growing portion of renters in places such as Jersey City, according to The Marketing Directors, but that number is poised to grow based on the belief that the tech giants are looking to grow and stockpile space on Manhattan’s West Side. Just last week, Google parent Alphabet Inc. reportedly entered into a contract to buy the well-known Chelsea Market building at 75 Ninth Ave. from Jamestown LP.
The company then announced plans to expand its footprint at a tower on West 15th Street along the Hudson River, according to Crain’s New York Business. Meantime, Amazon has announced plans to add some 2,000 jobs while opening a 359,000-square-foot administrative office at 5 Manhattan West, a 15-story building on West 33rd Street and 10th Avenue.
“It seems like that tech pocket or tech market is on the West Side, running from Chelsea and Union Square up to Midtown,” said Marty Brady, executive vice president for sales and leasing with The Marketing Directors. “And it’s perfect for the commuters because of the PATH train.”
The firm, which represents developers in marketing new luxury buildings, has already seen the tech sector’s growing impact on Jersey City. Citing data from 2010, when The Marketing Directors leased about 1,000 apartments in the city, Brady said about 70 percent of renters listed financial services as their occupation, while about 4 percent listed IT and technology.
In the firm’s most recent portfolio, which spans close to 2,000 units at four recently opened buildings in the city, 43 percent of renters listed financial services and around 18 percent listed IT and technology, Brady said. At one building, Journal Squared, 22 percent of residents come from the IT field.
“It’s a huge change,” he said. “It’s actually the No. 2 occupation we’re tracking in Jersey City.”
Brady said that should give “much more of a comfort level to developers and to people lending to developers” in Jersey City and others places along the Gold Coast, where some observers have voiced concerns about overbuilding. But he noted that existing rentals are staying close to 100 percent occupancy even as new ones are going through lease-up.
The Marketing Directors also recorded a 7.9 percent increase in average listed rental price in Jersey City from the first quarter of 2017 to the fourth quarter, an uptick of $237. Average price per square foot during that time rose $1.25, representing a 2.8 percent increase.
It’s further proof that “Jersey City has become a real alternative” for those moving out of New York City in recent years. As it concerns the growing tech sector, he said the Hudson County city fit the profile of what those workers want in their living environment.
“I think people in those fields appreciate the art culture, the music culture, the nightlife, the foodie trends that are coming to Jersey City,” Brady said. “And that is what’s fueling Jersey City.”