Northern New Jersey Retail Market Report

Job growth and stable inventory expansion guide retail sector through headwinds. While mounting economic uncertainty will bump up vacancy as many retailers pause store expansions moving into 2023, the region retains various positive demand factors. Despite economic flux, area firms are projected to grow the employment base across multiple sectors by year-end. Proactive state tax incentives have also spurred relocations by financial technology and life sciences employers, allowing for an average discretionary income above the national mean. Accommodating these drivers, supply additions are continuing at a stable, yet mild, pace of 0.4 percent inventory expansion for a third year. A majority of the active pipeline’s square footage has already been leased, including larger move-ins by LA Fitness and Lidl. In addition, the two largest leases beginning in 2023, signed by Macy’s Furniture and Target, comprise a combined 128,000 square feet at properties both built in the 1970s, indicating vintage properties can maintain tenant appeal.