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HFF's Jose Cruz on the New Jersey CRE Market

Monday, November 28, 2016

HFF Senior Managing Director Jose Cruz of HFF New JerseySenior Managing Director Jose Cruz, who is also co-head of HFF's New Jersey office, will be a panelist at ULI North New Jersey's Real Estate Trends 2017 event on December 1. The event will explore key emerging trends that will shape the real estate market in 2017, including what the future holds for real estate investment and development; results of the 38th annual Emerging Trends in Real Estate® 2017 survey and interviews; and what industry leaders, including Mr. Cruz, say about the outlook for U.S. real estate property sectors, metro areas, finance and capital markets and other real estate issues. 

A 25-year veteran of commercial real estate, Mr. Cruz has been involved in more than $18.4 billion of office, industrial, retail, multi-housing and land sales.  Recent noteworthy New Jersey transactions include Alexan Riverdale, The Harrison, a two-building office portfolio in Middleton and eaves Nanuet. In advance of the event, Mr. Cruz discussed the New Jersey commercial real estate market.

Q&A with Jose Cruz

  • What makes the New Jersey market unique?  When compared to other national markets, our proximity to New York City sets us apart. In addition, the depth of our industrial market with well over one billion square feet of industrial space throughout the greater New Jersey market attracts a significant amount of capital for that product type. Also, our nation-leading median household income draws a significant amount of retailers and high-end apartment developers to the state. Finally, our Class A office parks are filled with Fortune 500 tenants.

  • Why should investors pay attention to New Jersey?  The demographics set us apart when looking at opportune places to invest. Incomes and population density rank among the highest in the United States. Our educated workforce also attracts major companies to New Jersey. We continue to see rent growth in multiple product types throughout the state, including industrial, multifamily and retail. The historical track record of institutional investment in the state continues to attract more capital, both domestically and internationally.

  • What trends in commercial real estate do you predict will be big in 2017 for the New Jersey market?  We will subjected to trends that impact other states as well as potential interest rate increases, but trends we expect to see in New Jersey specifically are continued investor demand for multifamily product, repositioning of antiquated office space though redevelopment or repositioning and the further expansion of medical uses into retail.

  • Does the New Jersey commercial real estate market provide any challenges that have to be overcome?  Our high property tax rate and our real estate transaction costs, which adds to the cost of doing business in the state, continue to plague us and force investors to reexamine their options when considering where to position their capital.

  • What exciting things are happening in the market right now?  We are seeing record pricing in various product types, including multifamily and industrial. We are also seeing international capital find its way to New Jersey, and not just the waterfront markets; we are seeing foreign money enter the suburban New Jersey marketplace and be competitive.

  • Any advice for those considering a career in CRE?  Become a well-rounded commercial real estate professional by making sure you have a working knowledge of the financial aspects of transactions but also understanding the physical asset is critical as well.

 





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