Steve Bussel, President, Bussel Realty Corp

Trends such as last-mile delivery and the growth of e-commerce manifested some of the best years for industrial real estate in recent times. Consequently, as an industrial real estate powerhouse, the state of New Jersey has the foundation for continued success in the industrial product type for many years to come. In an interview with Invest:, Steve Bussel, president of Bussel Realty Corp, highlighted the current opportunities and challenges for the industrial real estate sector. “We have seen communities become anti-new industrial construction. This is an ongoing challenge for developers and institutions to create new inventory,” Bussel said.

What separates Bussel Realty Corp from its market peers?

I have been in the business since 1973. In 1984, Bussel Realty was established. Today, we have approximately 25 associates. Our focus has always been on industrial real estate. We have a niche in the marketplace focused on Essex, Hudson, Union, Middlesex, and Somerset counties and the surrounding submarkets. This is our area of expertise. Recently, we have completed several transactions nationally as our clients expand outside of New Jersey. Approximately three years ago, we started a commercial retail division. We believe that there are synergies between the two types of real estate products. As a niche company, we compete against the national players. It can be quite challenging to compete against the bigger competitors. At the local level, we are deeply entrenched in the market with a 40-plus-year track record, making our brand well-known and providing a competitive advantage to us. Due to this, much of our business comes from referrals, repeat business or expansions, or previous relationships. We have a significant number of relationships in this market, which yields a great number of potential referrals. We pride ourselves as the largest independent real estate firm dedicated to industrial real estate in Central New Jersey. 

How does the company evaluate commercial and industrial real estate opportunities?

We cover about five counties, and each of our associates has different strengths in relation to the counties where we mostly operate. We track all available properties in those counties through our in-house inventory system. We track all availability through developers, owners, and other cooperating firms and brokers. From that perspective, we are equipped to do deals of all different square foot sizes. Our niche is in local market knowledge. Our biggest asset is our associates and their knowledge of the areas where we operate. From that perspective, we have our finger on the pulse of everything available. We have tremendous interactions with every major institution, owners, and developers, going back more than 40 years. Relationships, knowledge of inventory, and knowledge of the market are our strengths. This is why we can still survive and compete with the bigger players. 

What trends are you following closely?

It seems that trends have largely stayed the same. 2022 was our best year ever because the market was extremely active. Prices in industrial real estate for the past five years have doubled, if not tripled in some cases. Retail saw some challenges due to the COVID pandemic, and it is now starting to come back around. As it relates to the industrial market, valuations went through the roof. In 2023, the market began to stabilize with a decrease in demand and an increase in supply. This carried through 2024 and into 2025, as the downward trend continues. Once the tariff situation is behind us, and once more manufacturing can be created in the country, I believe that the current policies may be the best thing that can happen to this country, but even more so, the best thing to happen to industrial real estate. We will see how all of this shakes out, but it can be a boon for industrial real estate. Once the current inventory is absorbed, the rents will go up, which increases valuation. Cap rates are currently a little high because of interest rates. If interest rates go down and the current supply is diminished, I believe cap rates will come down, which will increase valuations. That is my personal current view of the market. I am optimistic because I see the potential. 

What other submarkets are you keeping a close eye on?

The e-commerce boom promulgated this huge last-mile activity. A significant amount of industrial real estate was absorbed because of Amazon and other big corporations needing same-day, one-day, or expedited deliveries. Anything close to the ports in New Jersey saw rents triple in price, which is almost unheard of. A building for sale that was marketed for $100 a square foot increased to $300 a square foot just in the last five to seven years. That’s a tremendous increase in overall valuations. I believe that we will have a bit of a soft period, but I am optimistic that the rebound in activity is set to grow tremendously moving forward. 

How have tenants’ needs evolved?

Many small entrepreneurs are active in renting small spaces for e-commerce. We see the trend for smaller tenants has stayed active. There is tremendous demand. Any existing inventory for smaller users is rented right away. Prices have been substantially higher just in the last five to seven years. That is the status of the market currently. Considering the larger users, we have a lot of vacancies with new inventory coming into the market. We need the current supply to get absorbed first before activity reinvigorates. 

What challenges have you identified for the industrial real estate market?

It has become harder and harder to build more warehouses in our markets, which have been heavily industrialized, and get new construction permits. Some towns have a moratorium on new industrial construction, as they just do not want them in their areas, due to truck traffic. This goes from Central to South Jersey. We have seen communities become anti-new industrial warehouse construction. This is an ongoing challenge for developers and institutions to create new inventory. As the market improves, the lack of new construction will create higher valuations.