Peloton Interactive has leased 840,000 square feet at a new logistics park in Linden, leading the way among tenants as the state’s industrial market continued to thrive in the third quarter.
Those are among the findings of a new report by CBRE, which noted that consumer goods and third-party logistics companies dominated leasing activity in northern and central New Jersey from July through September. The fast-growing at-home fitness equipment company was the top contributor in nearly 5.4 million square feet of new tenant commitments and expansions, taking space at the multiphase, 350-acre Linden Logistics Center off Tremley Point Road.
Advance Realty Investors, Greek Development and PGIM Real Estate are developing the planned 4.1 million-square-foot campus.
According to CBRE’s report, leasing activity in Q3 fell 34.5 percent from the second quarter due to a lack of available space. Year-to-date leasing activity in the region surpassed 22.4 million square feet heading into the fourth quarter, rising 37.5 percent from the same period in 2020.
“This year’s strong first and second quarters are keeping the market on track for an exceptional year of leasing, though the lack of supply to meet demand may continue to constrain leasing as we round out the year,” said Thomas Monahan, a vice chairman with CBRE. “The third quarter’s net absorption total resulted from a combination of strong leasing, the completion of 1.7 million square feet of new developments that were fully preleased, and few large space additions.”
CBRE also pointed to six projects that began construction during the quarter, mostly in Central Jersey, for a total of 1.3 million square feet. While preleasing continued in Q3, the firm noted that owners of properties under construction have grown reluctant to strike deals in a market where rents significantly increase month to month.
With availability falling to 4.8 percent, average Class A asking rents in northern and central New Jersey reached $14.38 per square feet by the end of September. That represents a 6.9 percent increase quarter over quarter and a 28.6 percent jump year over year.
Other top leases during Q3 included Volkswagen’s 935,000-square-foot renewal at 47 Station Road in Cranbury and Alan Ritchey’s 511,000-square-foot lease at 39 Strykers Road in Phillipsburg.
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