9
With a 9.4 percent population increase since
the 2010 U.S. Census to an estimated 270,750
people in 2017, Jersey City boasted the highest
growth rate out of any New Jersey municipality.
Hoboken / Jersey City
With 18.3 million square feet of rentable office space, the
Hoboken/Jersey City area represents the largest transit hub
market in Northern and Central New Jersey. The state’s use
of economic incentives to attract corporate investments had
been a leading factor behind recent Class A demand witnessed
in this market. The Hoboken/Jersey City Class A vacancy rate
retreated from more than 19.0 percent in 2016 to 18.0 percent
one year later in response to 211,780 square feet of positive
net absorption. This represented the largest volume of Class A
absorption registered among the transit hub markets during
2017. Contribut ing to this absorption was Tory Burch’s leasing
of 93,000 square feet at 499 Washington Boulevard in Jersey
City. The fashion designer relocated several of its business units
from Manhattan after receiving a 10-year $10.7 million Grow
New Jersey award. In addition, L’Oréal USA, which acquired IT
Cosmetics in mid-2016, absorbed 60,000 square feet at 111 Town
Square Place in Jersey City.
The Hoboken/Jersey City average asking Class A rental rate was
nearly $40.25 per square foot at year-end 2017, which was the
highest Class A rent recorded among the transit hub markets.
Rents in this market are expected to trend upward in the coming
year as landlords boost asking rents for spaces in buildings
undergoing renovations and improvements.
Net new supply, net absorption and total vacancy
Net new supply
While Jersey City’s office market footprint has remained stable
for more than a decade since the development of Goldman
Sachs’ office tower at 30 Hudson Street, new residential
developments are attempting to keep up with the city’s growing
population. With a 9.4 percent population increase since the
2010 U.S. Census to an estimated 270,750 people in 2017, Jersey
City boasted the highest growth rate out of any New Jersey
municipality. Access to Manhattan via mass transportation
options that include the ferry and PATH rail line have fostered
surging population growth, while tax abatement programs have
encouraged developers to unleash a wave of residential projects.
To incentivize development from the waterfront area and into
more inland neighborhoods like Journal Square, longer-term
abatements have been introduced by Jersey City.
Net absorption
total vacancy
600,000 22.0%
300,000 20.0%
0
18.0%
-300,000
16.0%
-600,000
14.0%
-900,000
12.0%
-1,200,000
-1,500,000
10.0%
2013
2014
2015
2016
2017