A 330,000-square-foot office building is coming down in Parsippany — and three tenants are already on notice

The office park era at 5 Wood Hollow Road in Parsippany is ending. Axonic Capital, a New York-based alternative investment firm, has closed a fully funded $30.8 million senior loan backing Deugen Development's acquisition of the 330,000-square-foot Class-B office building — financing that covers not just the purchase but the demolition that's expected to follow.

In its place: a 340,000-square-foot Class-A industrial building, part of a wave of office-to-warehouse conversions reshaping commercial corridors across North Jersey as demand for office space keeps softening and industrial space keeps commanding premiums.

Who's there now — and who has to move

5 Wood Hollow Road is currently home to three tenants: Toys R Us's corporate offices, Weichert Workforce Mobility, and Coyne PR. The building is expected to be fully vacant by the end of 2026, according to Axonic's announcement of the financing, which means all three organizations are on a clock to relocate within the next several months. None of the three has publicly announced where they're headed next; we're checking with each and will update this piece if we hear back.

The timeline

Demolition is projected to begin in late spring 2027, per both Axonic and Deugen. No construction schedule beyond that demolition start date has been made public — meaning there's no announced date yet for when the new industrial building would actually open, or when it might come before Parsippany's planning board for the site plan and any zoning approvals the conversion requires.

The bigger pattern this fits

This isn't an isolated deal — it's a template. Deugen, a family-owned, Paramus-based commercial real estate firm, describes its current focus as "ground-up industrial development and value-add repositioning in New Jersey's most supply-constrained infill markets," which is a fairly direct way of saying: aging office buildings in good locations are worth more torn down and rebuilt as warehouses than they are as offices. Axonic, which manages roughly $8 billion in assets, framed the deal similarly, citing confidence in Parsippany's demand for industrial space specifically.

For Parsippany, that raises a few open questions that don't yet have public answers: what the township's zoning currently allows on the site without a variance, whether the conversion needs planning board review, and what it means for the township's own commercial tax base to trade a mostly-full office building for a speculative industrial one. We'll be watching the planning board's agenda for when — or whether — this comes up for a public hearing.