By Larry Feld

Take the warehouse industry , for example . Fulfilling the needs of the online retail industry has turned New Jersey into a key logistics state . According to the “ New Jersey Warehouse Boom ” report , written by the Environmental Defense Fund and published by Globalcleanair . org , New Jersey now has 3,034 warehouses comprising 527 million square feet . That represents an astounding 35 % increase in the last two decades .

So what will 2025 look like ? What are the Trends ?

“ I expect that there ’ ll be a lot of improvement in the warehouse industrial market , from both leasing and in sales ,” suggests William C . Hanson , President of NAI James E . Hanson , Commercial Real Estate Services .

“ We are seeing the first shoots of recovery for warehouse construction and investment in warehouse automation as e-commerce starts to stabilize and companies embrace just-in-case inventory ,” notes Rueben Scriven , Research Manager for Interact Analysis , a national research firm .

David Polazzi , Senior Counsel and Chair of Commercial Real Estate practice at Peckar & Abramson , P . C . adds , “ I think we will see growth in some segments , such as the light industrial / warehouse market and multi-family residential real estate development projects , while retail and office will continue to struggle .”

Bill Hanson agrees . “ The office market is going to continue to be challenged . There ’ s just not as much demand for office space as there once was ,” Hanson notes .

His comments mirror the opinion of the accounting and advisory firm PwC . In their most recent “ Emerging Trends in Real Estate ” report , the firm opines “ Today ’ s critical real estate investment factors are supply dynamics and a modernized stock of buildings . For example , newer office buildings offer amenities ( the socalled ‘ flight to wellness ’) that make them preferable to the languishing stock of aging buildings .”

“ In New Jersey , we ’ ve overbuilt and have an excess inventory of older office space ,” Hanson continues . “ Most of the deals we ’ re involved in are some kind of consolidation of space . It may be a nice-sized deal , but it ’ s half of the square footage the tenant is coming out of ,” Hanson explains .

“ We feel optimistic about the real estate market for 2025 ,” notes Oliver Lewis , Executive Vice President of Commercial Lending for Columbia Bank . “ The economy is strong and unemployment remains relatively low . Commercial borrowers in 2024 took a backseat ‘ waiting to see what happens ’ approach . I think we ’ re starting to see that trend reverse . With interest rates dropping , opportunities make more sense for our investment clients . We ’ re definitely seeing more activity ,” he says .

“ I am positive about the new year ,” agrees Terrie O ’ Connor , President of Terrie O ’ Connor Realtors . “ I think there will be more transactions and a little more improvement all-around .”

Some bright spots in commercial real estate are showing promise . One surprise is retail space . “ The good location properties will remain in demand and pricing will be good . It ’ s that secondary retail that is suffering . I don ’ t see that changing ,” Hanson says , adding

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