To many Manhattanites the west bank of the Hudson River is looking much closer than it did 10 years ago -- just ask Chase Manhattan Bank. The financial powerhouse along with more than 20 other companies have fallen prey to New Jersey's siren song of lower rents, more available space, and lower tax and construction costs. An example of the costs savings, as reported by CB Richard Ellis, shows average asking lease rates for Northern and Central New Jersey office space as $23.43 per square foot in third quarter 2000 as compared to an average $53.94 for space in Manhattan. What better excuse to leave?
     Chase's headquarters will remainin New York, but this move will bring 1,500 new jobs to Jersey City's Newport Office Complex, the location of the company's new 1.1 million-sq.-ft. (102,193-sq.-m.) shared services facility.
     "It was impossible for us to turn down the overwhelming economic package from the state of New Jersey, which included the ability to occupy a build-to-suit, technology-ready location vs. the time-consuming and expensive need to re-stack and upgrade the antiquated space at 55 Water Street (New York)," says Tom Block, Chase senior vice president and head of government affairs.
     Turnaround times have indeed made New Jersey's waterfront an attractive site for fast-growing companies. For Chase, New York offered lower-cost alternatives to Manhattan such as Long Island City, Queens and Brooklyn, but it could not promise the company new space in a reasonable amount of time. Developer LeFrak promised Chase Manhattan a new build-to-suit in Jersey City within 18 months.
     A word of caution, however: The northern and central New Jersey office markets are growing tighter, and rates are inching up slowly. The average leasing rate of $23.43 in 3Q2000 was up from $23.28 in 2Q2000. Jersey City (Hudson County) has a vacancy rate of only 1 percent, reports CRESA Partners, and CB Richard Ellis notes that the market offers the highest average lease rates in the state at $26.78. Class A space in Jersey City averages $28 per square foot.
     To ensure that businesses continue flocking to New Jersey, especially those of the high-tech ilk, former Gov. Christie Todd Whitman announced in 2000 her $165 million "New Jersey Jobs for a New Economy" economic package. The program consists of three major components: a $23 million investment in high-tech work-force development initiatives, the $105 million Creating High-tech Jobs program for ensuring a competitive environment for entrepreneurs and small high-tech companies, and a $37 million investment in New Jersey Technology, a program that will encourage more efficient delivery of services at the state government level.
     Whitman also signed into law two real estate initiatives: a $4 million Commercialization Center in Middlesex County and a $6 million technology center in southern New Jersey. The Commercialization Center in Middlesex is being developed as phase three of the Tech Center, a project designed to meet the needs of research and development companies, especially in the biosciences and IT industries.