New Office Market Report: Transit Service Is Key
April 12th, 2017 by Elaine Clisham
A recent report from commercial real estate firm Jones Lang LaSalle confirms what has been anecdotally clear in New Jersey for some time: Office facilities that are well served by transit are seeing significantly higher rents and lower vacancy rates than their transit-non-accessible counterparts. This echoes research the firm did last spring on the New Jersey market specifically.
The report notes that not all companies can afford Class A office space in the densest cities, so many of them are seeking out sub-markets with good transit infrastructure. Office properties in those markets are enjoying rental premiums of almost 80 percent, and are seeing vacancy rates more than three percentage points lower, compared to properties in markets not served by transit. And almost half of all new office construction is taking place in transit-accessible sub-markets.
The more important highlight in the report, however, is its point about the need for capital investment in public transportation and its related infrastructure. Employers need good transportation infrastructure in order to attract the best talent and help drive innovation, and metropolitan areas need it as increasing demand places additional strain on their limited road capacity.
The report is another reminder that, as New Jersey Future has detailed in its recommendations to the next governor, the state’s economic competitiveness depends on smart, cost-effective investment in transit infrastructure, as well as investment in the human capital necessary to transform our transportation network into a unified, efficient system focused on maximizing mobility and access.
For more details on New Jersey Future’s recommendations to the next governor on infrastructure investment, see our gubernatorial blueprint, Smart Growth Is Economic Growth.