Seagis Property Group Acquires 171,000-SF Vacant Warehouse at Port Elizabeth, New Jersey

Seagis Property Group announced Nov. 5 that it has acquired 5-61 Bay Avenue, a vacant, newly constructed 171,000-square-foot warehouse/distribution facility in Port Elizabeth, New Jersey. A CBRE team facilitated the sale of the Class A property, which has 40-foot clear heights and sits on 8.1 acres.

Seagis Property Group Expands New Jersey Portfolio

The building is located across the street from Maher and APM Terminals and adjacent to Port Newark Container Terminal. The property offers access to Newark Airport, the Holland Tunnel, the Lincoln Tunnel and the New Jersey Turnpike.

"We are pleased to expand our New Jersey portfolio with this Class A asset situated at the center of a global logistics shipping hub," said Tyler Baker of Seagis Property Group. "We look forward to providing a unique opportunity to lease a newly built asset that sits in the heavyweight corridor, Foreign Trade Zone 49, and contains a long-term PILOT. We thank our brokerage partners for their support in completing this acquisition."

Because the building was vacant at the time of the acquisition, the asset will be offered for lease. The property is also within Foreign Trade Zone 49 and carries a long-term payment-in-lieu-of-taxes (PILOT) arrangement.

CBRE Brokerage Team Handled the Sale

Brian Golden, Brian Fiumara, Larry Schiffenhaus and Tom Monahan of CBRE facilitated the sale of the property. Seagis Property Group thanked its brokerage partners for their support in completing the transaction.

Elizabeth Industrial Market Context

The acquisition comes as New Jersey's industrial market shows improving occupancy alongside continued new supply. Cushman & Wakefield reported 4.8 million square feet of third-quarter net absorption statewide, bringing year-to-date absorption to 9.0 million square feet. Warehouse and distribution vacancy fell below 9%, and overall industrial vacancy declined to 8.1%.

Newer buildings continue to command higher rents. Average warehouse/distribution asking rents stood at $16.43 per square foot, while Class A taking rents reached $16.67 per square foot, a 15.8% premium over non-Class A warehouse and distribution properties. Avison Young placed statewide NNN asking rents at $15.39 per square foot and industrial vacancy at approximately 8.0% in the third quarter.

The 171,000-square-foot size falls within the most active portion of the leasing market. Avison Young said third-quarter leasing was concentrated in transactions below 250,000 square feet, with the 100,000-to-249,000-square-foot segment leading activity.

Supply Pipeline and Sales Activity

New Jersey's industrial development pipeline declined to 11.8 million square feet in the third quarter, continuing a contraction from its 2023 peak. KBC Advisors reported 14.5 million square feet of year-to-date net absorption, statewide vacancy of 7.7% and a 46% quarter-over-quarter increase in leasing volume to 8.1 million square feet. Elevated land costs, longer entitlement timelines and fewer developable industrial sites are limiting future supply.

Rents have shown signs of stabilization rather than sharp growth. Industrial rents softened modestly as new supply entered the market, even as vacancy declined and demand remained positive, and KBC reported New Jersey taking rents were broadly stable to slightly lower year over year.

Sales activity also remained active. Colliers reported $849 million of New Jersey industrial sales across 43 transactions in the third quarter, at an average price of $312.33 per square foot.

Outlook for 5-61 Bay Avenue

With the building vacant at closing, leasing will be the next phase for Seagis Property Group. The firm cited the property's proximity to marine terminals, its Foreign Trade Zone 49 designation, highway connectivity and long-term PILOT as features of the asset.

Sources

• Seagis Property Group Acquires a 171,000 Square Foot, Vacant Building in Elizabeth, New Jersey