Warehouse Feasibility Study in New Jersey

New Jersey: second in the nation for warehouse loans

New Jersey is second among 46 states in warehouse and distribution lending, with 51 loans and $75.1 million approved from FY2017 to FY2026. Within New Jersey the class ranks only 19 of 39, so warehousing is not a leading use of SBA credit at home, but the location quotient of 2.15x shows a share more than double the national one. The median loan of $500,000 equals the national benchmark median (1.00x), while the interquartile span stretches from $225,000 to $3.1 million, a very wide range that mixes small leases with multi-million-dollar facilities.

A narrow definition of warehouse

The data covers public warehousing only. A company that builds a warehouse for its own use is coded to its own industry, so a manufacturer's distribution building does not appear. A borrower looking at a speculative or third-party warehouse is the right comparison; a company building its own warehouse is not. Lenders should keep this in mind when comparing New Jersey with states that classify differently.

There are 41 SBA 7(a) loans and 10 SBA 504 loans, and none is franchised. Fulton Bank, National Association shows 5 loans and $7.6 million, and TD Bank, National Association 5 loans and $2.6 million. Cancellation is the most worrying number: 22.5% as a floor for the FY2017 to FY2024 cohort and 25.0% as a ceiling. Many approved New Jersey warehouse projects may never have funded, a result consistent with permitting, site control and construction hurdles in a dense state. The charge-off rate is not printed, since under 30 loans have seasoned long enough, and that gap is no claim of zero losses.

What a New Jersey study must test

Middlesex has 10 loans, Passaic 7 and Ocean 6, with Essex and Union at 5 each, so the evidence sits in the central and northern corridor. A study should test demand through vacancy, rents and logistics access to the ports and highways, and should check zoning and environmental history early, because delays end projects. Cost must include site remediation risks and the price of land. Coverage must be tested with a lease-up period and a tenant loss. The appraisal needs a value for the building empty. Volume has recently improved, with 9 loans and $7.6 million in FY2024 and 9 loans and $15.4 million in FY2025, followed by 2 loans in FY2026.