Cushman & Wakefield’s David Stifelman: “Newark’s Office Landscape Has Changed”
Media Contact: Evelyn Weiss Francisco, firstname.lastname@example.org, (201) 796-7788, @carylcomm
TEANECK, N.J., May 29, 2012 – The question was, “What’s Driving the Newark Office Market?” The venue was the Northeast New Jersey Chapter of the Appraisal Institute’s 6th Annual Meadowlands Conference, and the answer was that “Newark’s office landscape has changed dramatically.” That message was delivered by David Stifelman, executive director of Cushman & Wakefield, Inc. at the Teaneck Marriott Hotel at Glenpointe.
“This is a great area for office,” said Stifelman, who has roots in New Jersey’s largest city. An historic mix of financial services, law and offices for manufacturing companies has been further enhanced by such projects as Prudential’s new tower and Panasonic’s pending relocation of its U.S. headquarters to an under-construction tower in the city’s downtown. That relocation opens up the potential for Panasonic’s vendors to “cluster,” said Stifelman. “That’s the next wave.”
The demand drivers, according to Stifelman, begin with the fact that at approximately $30 per square foot, asking rents for Newark’s 6.5 million square feet of class A space (and 13.5 million square feet overall) are half of the price of “cheap” space and one-third to one-quarter of the priciest space in Manhattan. And that lower-priced Newark space is just 15 minutes by rail from Manhattan.
This segues to another demand driver: “Newark’s robust transportation network, from mass transit to the highway network is very important,” he said. “The pricing is going up for highly coveted class A space, but all things considered, Newark is a very competitive and very compelling marketplace,” he said, noting that the vacancy rate is 9.5% for class A space and 17% overall.
In the larger picture, “with all of the major projects going up, including the mixed-use Teachers Village to name one, Newark will become a real live/work community,” Stifelman said. “With all of the cranes that you see in the skyline – it’s very exciting. People will continue to cluster around transit hubs because people want efficiency.”
Yet another plus for Newark, according to Stifelman, is the city’s footprint of higher education. “50,000 students and teachers in the one square mile of University Heights is the densest concentration of academia in the U.S. And that footprint will continue to grow.
“We are seeing a migration of people in New Jersey from west to east—from the suburbs to Newark,” he said. “In 15 years, there will be a lot more steel and glass towers. Money is available, incentives are available, and Newark is on the rise again.”
Stifelman shared the dais with Lyneir Richardson, CEO of Brick City Development Corporation (BCDC), Newark’s development arm. “Newark’s transformation has become a national model,” Richardson said. “This is an evolutionary process, and we continue to address the more challenging issues.”
Noting that BCDC is actively marketing seven sites for development as office towers, and that there are more than 70 active projects around the city, “come take a look,” Richardson invited conference attendees. “We are spreading the news about Newark’s assets – it is very exciting.”