The housing market seems to be stabilizing finally, but is commercial real estate still due for a crash? There was a sobering report out yesterday from Grubb & Ellis, a commercial real estate advisory firm based in California, about the business climate in North and Central Jersey. The amount of available office space has actually increased over the past year, despite the economic recovery. At the end of 2008 there was 6.5 million square feet of office space on the market in the area, but by the end of 2009, that was up to 7 million.
The hardest hit areas were on the so-called Gold Coast in Hudson County, which has been built up incredibly fast over the past several years, and the Parsippany area. Grubb & Ellis further forecasts that there's not much reason to expect drastic changes in this area throughout 2010.
There's a bit of a silver lining to that, as business startups would benefit from having cheap office space available, which would help fuel the entrepreneurial economy. But there are going to be an awful lot of real estate firms and investors in trouble, and the construction sector will suffer as well, possibly for years to come.
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