20.1 Million Square Feet
The Hudson River Waterfront (HRW) submarket consists of 42 Class A buildings with 20.1 million square feet of inventory. Though on the New Jersey side of the river, this stretch of real estate has much more in common with Manhattan than with the rest of its home state.
This is due to its importance as a back-office location for various New York-based firms, particularly those in the financial services industry. Along the way, the HRW has also managed to snag a few headquarters offices too.
All that said, this submarket is still relatively small—for instance, its inventory is just 35 percent of the current Class A Downtown Manhattan figure. But the New Jersey side is extremely competitive, with a variety of tax breaks luring firms away from its big brother (and generally quite successfully too).
New York City has been fighting back, though, with competitive asking rents ($42.69-per-square-foot ask Downtown versus $34.15-per-square-foot ask for HRW) plus its own incentives.
But HRW is a tough opponent. Though the submarket is tight (with a 9.9 percent vacancy rate), there are 9.4 million square feet of potential new development, including the soon-to-be-built 221 River Street (Waterfront Corporate Center III) in Hoboken, anchored by Pearson. With a number of big Manhattan tenants in the market today, expect the HRW to go after at least a part of that business with guns blazing.
Robert Sammons, Cassidy Turley