PORT TRENDS TO WATCH
The Port of New York and New Jersey (Port of NY & NJ) has consistently been the busiest port on the East Coast, serving as a key gateway. With six container terminals and multiple cargo rail lines, the Port of NY & NJ services one of the world’s wealthiest and most dense consumer base. The Port has the largest 250-mile radius population of any port in North America, with more than 60 million people making up one-third of the country's GDP.
Through June, the Port of NY & NJ handled 4.4 million TEUs, marking a 4.9% increase compared to the same period last year. Import volume continued to drive growth, increasing by 3.5% to 2.2 million TEUs, while exports rebounded by 4.2% to 712,565 TEUs. This growth was driven by the port handling 687,671 TEUs in June, making it the nation’s busiest port on the East Coast. Despite tariff-related uncertainty, the Port of NY & NJ has demonstrated strong resilience through June 2025.
Following a brief decline in January, rail volume at the Port of NY & NJ rose steadily for five consecutive months, increasing 12.3% in May to reach 361,144 containers. In the same month, the port handled 34,437 autos—up 1.3% from May 2024. Despite this monthly gain, total auto shipments from January through May fell 10.2% compared to the same period last year. Overall, port activity through June has displayed solid year-over-year (YOY) growth, reinforcing the region’s continued strength as a critical logistics hub.
Looking ahead, trade policy decisions surrounding tariffs will be important in the port’s continued success during the second half of 2025. However, the Port Authority has initiated key projects to bolster future growth, from accommodating larger vessels and enhancing infrastructure.
THE PORT REGION WAREHOUSE/DISTRIBUTION MARKET
The Port of NY & NJ serves one of the most concentrated and affluent consumer markets in the world. The Port Region is one of the most mature submarkets in New Jersey and demand for space increased as cargo volumes and ship sizes grew in response to heightened consumer demand. The submarket offers tenants a superior location within proximity to the New Jersey ports and the busiest thoroughfares in the State.
The vacancy rate in the Port Region rose by 450 basis points YOY to 12.2%, largely due to the delivery of new, unoccupied developments. Notable new deliveries in the second quarter included a 426,275-square-foot (-sf) speculative project at 145 Industrial Drive in Jersey City, and a two-building speculative development totaling 204,407 sf at 681 Main Street in Belleville. Additional vacant space added in the second quarter included a 433,204-sf space at 169 Pulaski Street in Bayonne, 240,255 sf at 112 Port Jersey Boulevard in Jersey City, and 225,029 sf at 150 Pulaski Street in Bayonne. With the addition of new large blocks in the submarket, occupancy losses in the second quarter turned net absorption negative at 392,287 sf.
Demand in the second quarter slowed by 47.5% from the previous quarter to 579,888 sf, which is below the two-year quarterly average by 10.9%. However, due to a strong first quarter, year-to-date new leasing is ahead of last year’s mid-year totals by 75.5% with 1.7 million square feet of lease commitments. Notable deals in the second quarter included Mike Tronics’ 148,315-sf new lease at 480 Frelinghuysen Avenue in Newark, and G&B Packaging’s 124,933-sf renewal at 1 Colony Road in Jersey City. The average asking rent showed a minimal 2.3% YOY decrease to $19.92 per square foot (psf), as Class A taking rents remained above the $20.00 threshold at $20.30 psf. This stability in rental rates underscores the resilience of demand for quality industrial space within the submarket.
