High Vacancy Rate Reported Along Eatontown Retail Corridor

A new report that examines the retail real estate market in central and northern New Jersey paints a positive outlook for much of the region, lending credence to the idea that the state is finally enjoying some economic recovery following a national recession that began in earnest in 2008.

But it's not all good news, however, especially locally. Among the submarkets with the highest retail vacancy rates, the Goldstein Group reports, is Route 35 from Shrewsbury to Ocean, an area littered with aging strip malls and retail development. According to the report, Route 35 from Shrewsbury to Ocean has a retail vacancy rate of 10.13 percent, the fifth highest among those areas surveyed.

The report, which utilizes data gathered in January and February of this year, identified 334 properties along the Route 35 corridor. In all, the properties account for more than 7.346 million square feet. Roughly 743,000 square feet is currently unleased.

Other struggling retail corridors include Route 18 in New Brunswick, which has a vacancy rate of more than 17 percent, and Route 10 from Livingston to East Hanover, which has a nearly 13 percent vacancy rate.

On average, however, the vacancy rate in the 22 retail corridors identified fell below 8 percent to 7.9 percent. This is the first time the vacancy rate has dropped below 8 percent since January 2009. The report cites an improving economy as well as attractive rental rates and secure locations not available in recent years.

"Optimism is much improved among retailers who see consumers returning to spending and shopping, as the economy slowly improves and hiring picks up," President Chuck Lanyard of The Goldstein Group said in a release. 

Some improving markets include Route 1 from Woodbridge to Edison, which has a 6.3 percent vacancy rate, and Route 37 in Toms River - also a 6.3 percent vacancy rate.

A steep decline in development is also partly responsible for the decreasing vacancy rate, the Goldstein Group said. In 2007, more than 2 million square feet of retail space was under construction. At the end of 2011, that number had fallen to 557,000 square feet.