Cushman & Wakefield’s Picco Reflects on the Market, Infrastructure, Connectivity and More
NEWARK, N.J., June 6, 2018 – The recently announced plan for the country’s largest mass timber office building – set to be built in Newark – has drawn attention from real estate practitioners, potential tenants and other stakeholders. It also has placed a spotlight on the ongoing transformation of New Jersey’s largest city, itself. In the following interview, Cushman & Wakefield’s John Picco, who is heading the Riverfront Square leasing agency, discusses Newark’s reinvention and why the location and time are right for this visionary project.
How would you define the state of the Newark market?
Picco: Newark today is truly a success story in the works. It has enjoyed a wave of development over the past several years – including new office, residential and entertainment product. In short, this is a burgeoning market with great potential – think of it as analogous to what Brooklyn was 15 years ago. Lotus Equity Group, Riverfront Square’s developer, has tapped into this momentum at the right time. Space coming online in New York is at historically high rents. If Governor Murphy continues the Grow NJ benefits program, tenants could get into new construction at Riverfront Square for under $15 foot, depending on number of employees. That is astounding when you compare it to rents in to Manhattan, Brooklyn and Long Island City. Newark is a hot spot with a bright future, and awareness is on the rise. The highest-profile evidence can be found both in this project and in Amazon’s short-listing Newark among its top choices nationwide for its second headquarters.
Beyond Amazon, what other tenants are targeting Newark?
Picco: With the new tech boom and surge in TAMI (Technology, Advertising, Media and Information) tenants, the entire New York/New Jersey region is seeing a resurgence in these industries. Young people are coming to the area and graduating from local universities – including NJIT and Rutgers in Newark – and companies recognize that establishing here enables them to tap into the country’s largest labor pool. Within this context, Newark is already known as a draw for TAMI. The city is home to Amazon’s Audible Inc., Panasonic and Prudential all are headquartered in Newark. Mars Wrigley Chocolate is about to sign a major lease, and Whole Foods is rumored to be considering Newark for its executive offices relocation. The specialty grocer already has established a retail presence in the city. And it’s not all about tenants coming out of the five boroughs to leverage Newark’s lower rents. Many of the high-profile companies in the market today are coming from the New Jersey suburbs in an urban migration that will enable them to benefit from the recruiting advantage of locating in Newark’s increasingly exciting, 24/7 setting.
In what way is Newark’s transit infrastructure coming into play?
Picco: Here’s a place that is less than 20 minutes by train from NY Penn Station, which makes it a convenient commuting alternative to the outer boroughs. The west-of-Hudson urban draw has worked incredibly well for Jersey City and Hoboken. Newark offers that same appeal – perhaps even more so in that it is a true urban center. It is home to Newark Penn Station, served by Amtrak, NJ Transit and PATH trains, as well as multiple bus carriers; and has light rail and bus service citywide. Newark Liberty is a major International Airport, and its Terminal A is undergoing a multi-billion-dollar renovation. Beyond that, it is easily accessible via major thoroughfares like I-78, the New Jersey Turnpike and the Garden State Parkway. This accessibility is playing a key role in drawing businesses and new residents alike.
Newark is known for its connectivity, which also must be working to its advantage.
Picco: Newark truly is one of the most connected cities in the northeast – which is a major advantage for technology-heavy operations. In fact, this has been another major contributor to its appeal to TAMI companies. The city houses the East Coast Telco Hotel and an abundance of cable, Telco networks, AWS Cloud Direct Connect and subsea cable connections. Newark also houses a massive dark fiber infrastructure that positions it to offer one of the country’s most powerful and inclusive networks. In fact, the city has taken advantage of the fiber network running under its streets, offering 1 gig (1,000 megabits per second) and 10 gig (10,000 megabits per second) speed for commercial and public spaces, and eventually in homes via its Newark Fiber program. Already, Newark’s Firebolt Wi-Fi is the fastest, largest, free outdoor public Wi-Fi network in the country. Funded by Audible, and Prudential and The Military Park Partnership, it launched in 2015 and covers a two-mile stretch of the city’s downtown.
How will Riverfront Square help to define the Newark of tomorrow?
Picco: The 500,000-square-foot, 11-story timber building, itself, is a game changer. Tenants will occupy really cool space at the largest and tallest mass timber building in the country. Michael Green Architecture’s design focuses on enhancing environmental sustainability and tenant wellness. People react differently to wood environments, which have been shown to foster higher productivity and workplace satisfaction. Regarding the overall development, Riverfront Square will include up to 2 million square feet of office space, 2,000 apartments, a hotel and 100,000 square feet retail. It represents the only true urban work/play/live development in New Jersey and one of only two in the region – the other being Hudson Yards in Manhattan. This innovative development will change the very character of Newark’s Broad Street corridor. Where much of the city’s historical development has created insular environments, Riverfront Square is designed to invite the community in. The design is pedestrian centric, with five acres of open space/public areas/piazzas (at the same time, there will be structured parking for 2,500 vehicles). It will blend into the wider neighborhood, which includes Military Park and Washington Square Park, cultural attractions like NJPAC and the Newark Museum, and retail and dining. Riverfront Park, which runs along the river, ultimately will extend up to and past the Riverfront Square property.
About Cushman & Wakefield
Cushman & Wakefield is a leading global real estate services firm that delivers exceptional value by putting ideas into action for real estate occupiers and owners. Cushman & Wakefield is among the largest real estate services firms with 48,000 employees in approximately 400 offices and 70 countries. In 2017, the firm had revenue of $6.9 billion across core services of property, facilities and project management, leasing, capital markets, advisory and other services. To learn more, visit www.cushmanwakefield.com or follow @CushWake on Twitter.