Page 34 - MidJersey Business - November/December 2014

MID-JERSEY
REAL ESTATE REPORT
L
SILVER

BULLETS
ocation, “Combine that with certain companies
location, and that do have a portion of their employ-

location are
ees working from home or some other
the top three remote location, and in general, the
WHAT HIGH-SPEED RAIL CAN
most important space needs per company have dropped
elements in real substantially. This has been a trend that MEAN FOR ECONOMIC GROWTH
By Scott Sherin, North America vice president of market-
estate. While has been continuing for the last decade ing and strategic planning, Alstom Transportation, Inc.
those timeless and I don’t see it slowing down.

qualities may “I came into the business before cubi- Ridership data on high-speed lines around the world

never change,
cles, when desks were lined up back-to- shows that high-performing rail service better con-
the tastes and demands of companies back and the average density of an ofice nects communities and attracts new passengers.

searching for contemporary ofice space was probably about seven or eight people When these passengers make the switch to rail, they
in the mid-Jersey region are constantly per 1,000 square feet,” Cohen says. are able reclaim the time they used to spend navigat-

evolving. Amenities that used to be clas- “Over the years, the average density ing trafic and airports and use it for themselves.
siied as premium upgrades like cov- dropped substantially to about 4-5 people
High-speed lines are not the solution for everything,
ered parking and food services are now per 1,000 square feet. With companies but for trips between 200 and 500 miles, high-speed
considered standard as the needs and looking to shave expenses as much as
rail provides the best return-on-investment for
practical uses of the modern ofice have possible, they are eliminating a lot of transportation dollars. In New Jersey’s case, reducing
undergone a signiicant change.
positions and the individual employees
travel times on the Northeast Corridor line could help
According to industry experts, it’s go- are now asked to do more than they used travelers move with greater luidity and generate
ing to be about much more than just a to do and occupy less space. Therein lies
economic growth opportunities in Trenton, Newark,
building’s location in 2015. As the State the cubicle situation. Old cubicle sizes and neighboring communities.
of New Jersey dangles attractive incen- were 8x10. Then they dropped to 8x6,
Just a short reduction in trip time is proven to be
tive packages to entice corporations to then they dropped to 6x6 and now you the tipping point for greater demand of rail service.

relocate or expand operations here, the have some people within a 4x6 area.
When trip times are three hours or less, rail becomes
wish list of what those companies are So it’s almost going back to what it was the preferred mode of transportation, and as trip times

seeking features a new set of speciic decades ago from the standpoint of an approach two hours, rail ridership sees the steepest in-
requirements.
occupancy level.”
creases approaching 90-plus percent. Such a change

Here are the seven most important could spur economic development for communities
factors shaping the mid-Jersey real estate
willing to make the investment.
landscape and the characteristics that Academic studies support this concept. A 2013
can set one facility apart from the rest of
ACCESS TO MASS TRANSIT IS MORE
study by Matthew Kahn, an environmental economist
the region’s saturated submarkets.
from UCLA and Siqi Zheng, a professor at Tsinghua
IMPORTANT THAN EVER BEFORE
Being close to transportation hubs
University in China, examined how bullet trains in
makes New Jersey-based companies China led to real estate booms in second-tier cities by
accessible to clients and it allows them
improving access to major metropolitan areas.
to reach big cities in New York, Phila- This future of high-speed rail is not fantasy. It is
OFFICE OCCUPANCY
delphia, and beyond. The transportation
possible today, with trainsets that reduce travel time
LEVELS ARE DECLINING
Nearly one-third of all full-time employ- infrastructure the state offers has always and attract ridership with a higher quality of service.
ees in the United States do most of their been an important attraction, but in the
Today’s high-speed trainset is built for comfort. Riding
work from a remote location. According current marketplace, access to trains, rail gives the consumers more legroom, workspace,

to a study conducted by Flex+Stragegy buses, and highways helps to recruit and storage than other modes of transportation. And,
Group and Work+Life Fit, Inc., 31 young talent, too.
rail operators have the ability to purchase trainsets tai-

percent of all workers do the majority “The ability for an employee to get to lored to the needs of their customers: the same rail car
of their work away from the ofice. They and from New York City and other areas
can offer extra business class seating or be adapted to
work from home or other remote loca- is absolutely critical,” says Dan John- offer high-end coffee bars or other luxury services.
tions and companies are shopping for sen, an associate director with Cushman
New Jersey’s unique geography, which connects
spaces for fewer employees.
& Wakeield. “Successful companies the whole state to rail and high-speed rail, will posi-
“What does that mean? Tenants lease today are focused on recruiting, and in
tively affect municipalities within the state by better
less space than they used to,” according order to recruit quality talent, you really connecting its communities and serving as a catalyst
to industry veteran Ed Cohen, a prin- do need access to New York City and
for economic development.
cipal partner at Prism Capital Partners.
public transportation. That’s why we see

business
32 midJersey