Union County, NJ Industrial Market Report Q2 2026

Union County’s industrial market strengthened in Q2 2026, supported by improving tenant demand and limited new supply. The market recorded 690,000 SF of positive net absorption, helping vacancy fall to 5.3% from 6.4% in Q1. Asking rents reached $14.50/SF, with annual rent growth of 2.1%, signaling continued pricing resilience. Meanwhile, just 278,000 SF remains under construction, limiting near-term supply pressure. Investment activity also improved from the first quarter, with $42.7 million in sales volume. Overall, the market enters the second half of 2026 with stronger occupancy and positive leasing momentum.

 

Highlights

• Demand accelerated in Q2, with 690,000 SF of positive net absorption helping drive vacancy down to 5.3%, a significant improvement from 6.4% in the prior quarter.
• Rental fundamentals strengthened, as asking rents increased to $14.50/SF and recorded 2.1% year-over-year growth, supported by improving occupancy and limited new supply.
• Development remains constrained, with just 278,000 SF under construction, while investment sales totaled $42.7 million during the quarter.

 

Northern New Jersey Demographics

Source: Oxford Economics

• Unemployment Rate: 5.2%
• Current Population: 2,300,810
• Households: 841,002
• Median Household Income: $111,352

 

Union County Industrial Rents, Vacancy, & Construction

Rents

Average asking rents increased to $14.50/SF in Q2, accompanied by 2.1% year-over-year rent growth. Rents have now increased for three consecutive quarters after reaching a recent low in late 2025, indicating renewed pricing momentum. Continued absorption and a limited development pipeline should provide additional support for rental rates moving forward.

 

Market Asking Rent Per SF

Source: CoStar Group, Inc.

 

Vacancy

Vacancy declined to 5.3% in Q2 from 6.4% in Q1, marking a notable improvement in availability during the quarter. The decline was supported by 690,000 SF of positive absorption as tenant demand gained momentum. While vacancy remains above the exceptionally tight levels experienced earlier in the cycle, the recent improvement suggests supply and demand conditions are moving back toward greater balance.

 

Vacancy Rate

Source: CoStar Group, Inc.

 

Construction

Union County had approximately 278,000 SF under construction at the end of Q2, representing a modest return of development activity following a largely inactive first quarter. Despite the increase, construction remains well below the levels seen earlier in the cycle, when the pipeline regularly exceeded 1 million SF. The restrained development environment should limit near-term supply additions and support occupancy across existing industrial properties.

 

SF Under Construction

Source: CoStar Group, Inc.

 

Union County Industrial Sales

Industrial sales totaled $42.7 million in Q2, increasing from approximately $32.7 million in the first quarter but remaining below the elevated transaction volumes recorded during several quarters in 2025. Investment activity therefore remains relatively selective despite the quarterly improvement. Pricing has remained resilient, suggesting investors continue to place a premium on industrial assets in Union County even as overall transaction velocity remains moderate.

 

Sales Volume & Market Sale Price Per SF

Source: CoStar Group, Inc.