Governor Chris Christie yesterday nominated Ken Kobylowski, chief of staff at the New Jersey Department of Banking and Insurance (DOBI), to become DOBI commissioner when the current Commissioner Tom Considine returns to the private sector next month. Before joining DOBI a few years ago, Kobylowski worked for two decades as an attorney representing real estate developers and banks.

Meanwhile, Considine’s tenure was recently praised by Bernie Flynn, president and CEO of West Trenton-based New Jersey Manufacturers Insurance Company (NJM).

"Commissioner Considine has been a strong consumer advocate while supporting a vibrant New Jersey insurance market.  His record of accomplishment during his two-year tenure is impressive, particularly the leadership he displayed in response to the dramatic events caused by Tropical Storm Irene and the Department's initiative in proposing regulatory reforms in Personal Injury Protection medical coverage designed to control costs borne by auto insurance policyholders," Flynn said.

"We look forward to working with the Governor's nominee as Commissioner, Ken Kobylowski, in the continuing effort to better control medical costs for the benefit of all New Jersey drivers," Flynn said.

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Watson Pharmaceuticals, Inc., Parsippany, recently announced plans to establish a Global R&D Technology Center in North Brunswick. The Company has signed a lease for a 32,000-square-foot facility at the New Jersey Economic Development Authority’s Technology Centre of New Jersey, a 50-acre complex consisting of lab, production and office space. Watson intends to initially invest approximately $4.5 million in outfitting the new facility.

The company plans to immediately retrofit approximately 19,000 square feet of space for product development and analytical laboratories.  The remaining 13,000 square feet will accommodate future expansion.  The facility, which is expected to be completed in the spring of 2012, will employ approximately 50 scientists, chemists, engineers and support staff. 

“Watson is pleased to continue to work with Governor Chris Christie, Lieutenant Governor Kim Guadagno and the Partnership for Action team as we expand our presence in New Jersey,” said Paul Bisaro, president and CEO of Watson.  “The location of the new Global R&D Technology Center will enable Watson to leverage our proximity to such educational centers of excellence as Rutgers University. This will enable Watson to establish collaborations with University departments including pharmaceutics, chemistry and engineering and permit us to benefit from the talent pool in the heart of the pharmaceutical industry of New Jersey. 

“This new center will become Watson’s state-of-the-art facility for developing generic pharmaceutical products, in particular for inhalation technology and respiratory products, with the ability to conduct formulation development and analytical testing. In addition, in line with Watson’s commitment to Quality by Design of pharmaceutical products, this center will focus on process analytical technology, packaging development, pharmaceutical technology, inhalation technology and new technology evaluation. We are proud to continue our growth in the Garden State, and to benefit from the quality of life and quality and commitment of the local talent pool,” Bisaro continued.

In early 2010, Watson relocated its global corporate headquarters to Parsippany, in a facility designed to support its global expansion and ultimately employ as many as 500 people.  In the new, 149,000-square-foot Parsippany facility, Watson combined senior management and global generics and brands administrative functions previously in separate facilities in the Morristown and Parsippany, as well as relocated remaining corporate leadership functions including finance and legal functions that had previously been located at Watson’s Corona, California site, into a larger space that enabled the Company to more efficiently manage its growing global generic and brand pharmaceutical and biologics businesses around the world.

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Tenants signed nearly 23.4 million square feet of new industrial leases in Northern and Central New Jersey in 2011, representing the highest volume since before the recession, according to year-end statistics for the U.S. industrial market recently released by commercial real estate services firm Cushman & Wakefield, Inc.
 
This resurgence in activity exceeds the state’s 2010 industrial leasing total (12.8 million square feet) by 83.2 percent. The Lower 287 Corridor and Exit 8A markets led the activity, each with more than 4.3 million square feet of transactions.
 
New Jersey’s largest industrial deal in 2011 involved Wakefern Food Corporation’s 1.1 million-square-foot commitment at 8001 Industrial Avenue in Carteret. Additionally, I/O Data Center executed a transaction at 3003 Woodbridge Avenue in Edison. That 831,427-square-foot lease represents the data center provider’s third location and the nation’s largest data center. In Robbinsville, Kenco Logistics, LLC signed on for 504,286 square feet at 100 West Manor Way. 
 
The abundance of new leasing activity in New Jersey in 2011 yielded an overall vacancy rate of 9.6 percent, down 1.6 percentage points from 2010. This decrease is heavily noticed in the Lower 287 Corridor which dropped 5.1 percentage points last year, resting at 5.9 percent. The Exit 8A Corridor also saw a substantial decrease from 2010, dropping from 12.7 percent to 10.9 percent currently. 
 
“Strong leasing activity helped cement 2011 as a turnaround year for New Jersey industrial,” noted Gualberto “Gil” Medina, Cushman & Wakefield’s New Jersey executive managing director. “With vacancy decreasing, tenants in the market today will notice more competition for space and will have to adjust their decision timelines accordingly. On the flip side, owners are hopeful rents will begin to increase with vacancy rates decreasing to pre-recession levels.” 
 
GARDEN STATE MIRRORS PROGRESS ACROSS U.S.

New Jersey’s progress mirrors strong performance nationwide. In the 33 U.S. industrial markets tracked by Cushman & Wakefield, more than 306.3 million square feet of new leases were completed in 2011, up 14 percent from 268.8 million square feet of new leases signed in 2010. Twenty-two of the U.S. industrial markets tracked reported an increase in new activity (with Northern and Central New Jersey among the markets with the most significant increases).
 
Stepped-up demand put downward pressure on the national industrial vacancy rate, which declined to 9.2 percent at the end of 2011, down 1.1 percentage point from the 10.3 percent vacancy rate at the end of 2010. Thirty of the 33 markets tracked by Cushman & Wakefield reported year-over-year declines in vacancy.
 
“While there is still concern that global economic uncertainty may erode some of the progress made in the U.S. industrial market, we’re increasingly confident that we are at the beginning of a sustained recovery that will gain momentum over the next 12 to 24 months,” said Jim Dieter, executive vice president and head of U.S. Industrial Brokerage for Cushman & Wakefield. 
 
CONTROLLED LOCAL, NATIONAL GROWTH SUPPORTS RECOVERY

New industrial properties completed in 2011 totaled just 903,000 in Northern and Central New Jersey, with 1.9 million square feet in projects currently underway. “Developers are still awaiting an increase in asking rental rates in order to justify project starts,” Medina said. “Still, we are seeing the beginnings of a return to construction. This is evidenced most clearly in JG Petrucci’s 572,000-square-foot speculative building now underway on Mill Road in Edison.”
 
National construction completions totaled 20.5 million square feet, slightly above the 15.9 million square feet completed in 2010, but below the prior five-year average of 88.1 million square feet. Currently, 23.6 million square feet in projects are under construction in the U.S.
 
These limited construction completions and increased demand led to healthy absorption – or the net change in occupied space – with levels also reaching pre-recession levels in New Jersey and nationwide. Absorption in the Garden State reached positive 6.4 million square feet, an increase from negative 8.5 million square feet in 2010. Nationwide in 2011, 94.4 million square feet of industrial space was absorbed, up significantly from the 13.1 million square feet of positive absorption in 2010, and the highest level since 2007. 
 
“The controlled growth of new construction is a positive trend, tracking at a pace that will support the overall recovery without undermining market fundamentals,” Dieter said.

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