The commercial real estate market is showing signs of a continued recovery in 2014. Urgent care and health care office space, industrial space, and retail space appear to be leading the way to a strong third quarter of 2014. Both leasing and sales trends are trending up in Mercer County.

The most activity our office has seen during the third quarter of 2014 is in the area of urgent care/health care office space. With an aging baby boom population and expanding mandates for health care coverage in the United States, the urgent care and healthcare markets have remained strong. I have seen many interested parties moving forward with their plans to expand into this area.

There have also been people interested in buying healthcare practices that are turn-key, including the practitioners’ client lists as part of the package. This is beneficial to both the retiring practitioner and the practitioner wanting to expand into another geographical area or one just starting a practice. My office accepted many offers and closed on properties in this area over the last quarter. Going forward this area looks very bright.

Indicators: Interest Rates, Loan Demand/ Easing Loan Standards, and the Job Market continue to be positive indicators in the third quarter.

• Interest rates are holding steady and remaining at historic lows in New Jersey. According to the State of Department of Banking and Insurance Division of Banking (as of September 30) the average 30-year fixed mortgage rate ranges from 3.81 percent APR for a person with a FICO score between 760-850 and up to an interest rate of 5.503 percent APR for someone with a FICO score of 620-639. The prime interest rate remains at 3.25 percent. The 10-year benchmark US Treasury Bill is yielding approximately 2.42 percent. The average rate for a one-year bank CD is still just below 1 at .97 percent APY with the five-year CD rate coming in around 1.81 percent APY. A low interest rate environment is a positive indicator for commercial real estate activity.

• Business loans are increasing with easing standards. More than 30 percent of banks cite stronger loan demand from small, midsize, and large businesses and only about 5 percent reporting weaker demand. About 11 percent of banks surveyed eased their standards for loans to midsize and large companies, and 8 percent did so for small businesses, while none tightened. Banks cited more aggressive competition and a more favorable economic outlook for the increased demand and easing of loan standards (USA Today, August 4, 2014). Easing business loan standards are a positive indicator for expanding commercial real estate opportunities in Central New Jersey.

• The job market is also improving in Mercer County. The unemployment rate in Mercer County as of June, 2014, is 5.4 percent compared to 7.3 percent for June, 2013. This compares favorably to the state unemployment rate of 6.6 percent and 8.4 percent for the same time periods. This trend is expected to continue into the third quarter of 2014 when the numbers are released later this year. Strong job growth is a key indicator and driver for the commercial real estate market in Central New Jersey.

All of these trends and indicators are showing us that a rebound in the commercial real estate market in Central New Jersey has been occurring going into and throughout the third quarter of 2014. I am very optimistic and look forward to these trends continuing into the fourth quarter of 2014 and beyond.

Joseph R. Ridolfi & Associates, 1245 Whitehorse-Mercerville Road, Building A, Suite 402, Hamilton., 609-581-4848, fax 609-581-5511. See ad, page 13.

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