Northern New Jersey Industrial Market Report

Large-bay demand slows, urban infill holds firm. Following a wave of move-outs in 2023 and early 2024, New Jersey’s industrial market began 2025 on steadier footing. Net absorption stayed positive for a third straight quarter during the first three months of this year, easing vacancy pressures amid a slowdown in new supply. A further decline in openings this year should support rebalancing despite trade-related volatility. Ongoing interest from last-mile and e-commerce users should help Bergen and Union counties remain more resilient. Notably, Union County has seen relatively steady big-box leasing, positioning it for solid occupancy gains amid limited deliveries and major move-ins, including several for more than 350,000 square feet. Nevertheless, large-bay leasing has slow sharply, with a minimal number of leases inked for spaces larger than 100,000 square feet during the first half of this year. Port-adjacent demand has softened in Essex and Hudson counties, while Morris and Passaic counties are seeing more cautious expansion. These trends could pressure near-term fundamentals if firms begin returning space to the market.