Merrill Lynch Boosts Jersey City Waterfront With 236,350-SF Expansion

By Paul Rosta -- CPN -- Dec 15

In a move that points to the growing strength of prime Jersey City waterfront office properties, Merrill Lynch & Co. is extending its lease at 101 Hudson Street to 236,350 square feet.

The property?s owner, Mack-Cali Realty Corp., could not be reached for comment this morning, but local sources said that Merrill Lynch uses the space for support and technology functions. Sources also report that Merrill Lynch was represented by Jones Lang LaSalle Inc. in the negotiations.

Merrill Lynch?s commitment is the latest example of tenant interest in the Jersey City waterfront, which is a brief train ride under the Hudson River from Downtown Manhattan. ?The availabilities have become much, much tighter in the last six months,? said Mark Ravesloot, executive vice president with CB Richard Ellis Inc., which was not involved with the transaction.

Although the overall third-quarter vacancy rate for the waterfront submarket was 15 percent, that figure does not reflect the reduction in availability. For example, several towers in the 3.5 million-square-foot Harborside Plaza complex are effectively fully leased, and a 250,000-square-foot availability at Harborside Plaza 10 is available in portions as a sublease from Charles Schwab & Co., Ravesloot explained.

Other recent major leases in the submarket have included a 350,000-square-foot takedown by Citigroup at Newport Office Center VII and a 300,000-square-foot lease by Deutsche Bank at Harborside Plaza 1. Last month E*Trade Financial Corp. leased more than 106,500 square feet at Mack-Cali?s Harborside Financial Center.

?Obviously the tightening of space in New York (City) has fueled some of the growth,? Ravesloot told CPN. Rents in Jersey City hover in the range of $30-plus per square foot, a deep discount from the $80 to $100 per square foot frequently seen in Midtown Manhattan. Ravesloot added that some major prospective tenants are now exploring the possibility of new office projects on the Jersey City waterfront, where development has focused on high-end, high-rise residential in recent years.

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