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Class B vacancy rate trends lower as inventory shrinks

• After approaching 26.0 percent in 2015, the Northern and Central New Jersey Class B vacancy rate trended lower, and had fallen to 21.2 percent by early 2018. This was the lowest Class B vacancy rate seen in nearly a decade.

• Contributing to the lower Class B vacancy rate was a shrinking supply of rentable office space. While the state’s Class B inventory base totaled more than 60.0 million square feet in 2015, this supply had declined to 57.1 million square feet by early 2018.

• More than 1.3 million square feet of Class B office space were removed from the inventory during the first quarter of 2018 alone, due to pending demolition or conversion to alternative uses.

• Among the largest facilities taken out of the Class B inventory were two buildings totaling nearly 290,000 square feet at 1515 Route 10 in Parsippany. The buildings are expected to be demolished to make way for a new mixed-use project planned by Stanbery Development.

Source: JLL Research

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