2012 Global Market report - NAI Global

Jacksonville, Florida
Martin/St. Lucie Counties, Florida
Contact
NAI Hallmark Partners
+1 904 363 9002
Metropolitan Area
Economic Overview
2011
Population
2016 Estimated
Population
Employment
Population
Household
Average Income
Median
Household Income
1,443,558
1,538,087
736,427
$70,069
$54,430
Jacksonville experienced four quarters of positive absorption
in all sectors but has done so with minimal employment
gains while loosing value in all rental properties due to a
decline in rents. Port expansion and educated back room
office service employment with quality infill development
locations bode well for Jacksonville’s future. In the short
term Jacksonville will “plod” along but long term will
continue to be one of the better places in America for
business to relocate.
All markets, office, industrial and retail continued to have
positive absorption during 2011, which is the good news,
but rental rates continue to decline in all three specialty
areas. The office market “chugs” along with Jacksonville’s
financial services sector continuing to expand and add a
relatively small amount of jobs. GE Capital, JP Morgan along
with Deutsche Bank lead the way. Overall the market has
bottomed out with vacancy rates declining slightly in each
of the last four quarters.
Jacksonville’s industrial warehouse leasing was notably
stronger in Q3 2011 and hadn’t been as strong since Q4
2010. Like the office market, the retail sector’s leasing and
absorption rates are up but rental rates are down. The
research/high tech space has suffered slightly, but not
enough to put a damper on the positive numbers for bulk
warehouse in the last four quarters.
Jacksonville’s retail market is the same old story within a
different specialty. There was positive absorption and slightly
declining vacancy rates but quoted rents also dropped. The
biggest news is LA Fitness has entered the market and will
be completing at least two deals by the end of 2011.
The Jacksonville apartment market continues its positive
trend. For the first time in three years the average market
vacancy factor is less than 10%. In all specialties, with
the exception of multifamily housing, there has been
minimal new construction, if any, while sublease numbers
remain stagnant in all areas but are still reduced from 12
months ago.
Contact
NAI Southcoast
+1 772 286 6292
Metropolitan Area
Economic Overview
2011
Population
2016 Estimated
Population
Employment
Population
Household
Average Income
Median
Household Income
437,453
490,775
201,130
$71,903
$51,026
Real estate of all types continues to be depressed with most
sales being REO dispositions or other types of distressed
sales. Leasing and end-user activity has increased in the
retail and office markets. Land continues to be sluggish.
Although some home builders are active in Martin and Indian
River Counties, St. Lucie County remains burdened with an
oversupply of inventory. The flex space sector remains slow
due to the functional obsolescence of flex space design.
The retail market has shown signs of tightening. Several big
box spaces had been vacated in 2008 to 2010 and these
spaces have been leased to new tenants significantly
reducing the inventory. At present there are no second
generation box spaces left in Martin and St. Lucie Counties
and the former Linens N Things in Vero Beach is presently
pending, an NAI Southcoast brokered deal.
Activity in RFP’s for office space has increased and
occupancy of office space appears to be up which has put
some upward pressure on rental rates for Class A and Class
B space. Class C or Class B secondary space remains
difficult to lease and both are suffering greater vacancies.
The trend has been for businesses to upgrade to newer,
better located space during the recession. Although rental
rates and occupancy has not reached levels at which new
construction is merited, this trend bodes well for newer
construction.
Residential land tracts in rural areas have reached prices
10% to 20% of what they sold for in the boom years of
2004 to 2006. Still, there is little activity in this sector. These
prices have caused some buyers to come off the sidelines
but these buyers are users such as churches, and horizontal
development has been proposed in the residential sector.
Commercial land has been slow with well located parcels
selling quickly and poorly located properties almost
unsellable at any price.
Functional warehouse and industrial properties have shown
strong appeal to businesses in the market, and are currently
selling at bargain prices. Flex space has proven to be difficult
for business to operate in due to the condominium nature
of most projects, lack of dock height bays and yard storage.
Total Population
Median Age
38
Total Population
Median Age
43
Jacksonville At A Glance
(Rent/SF/YR) low High effective avg. Vacancy
doWntoWn offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
suburban offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
IndustrIal
N/A
$ 18.12
$ 14.00
N/A
$ 18.50
$ 13.00
$
$
$
$
N/A
24.00
17.00
N/A
21.00
17.50
N/A
$ 18.49
$ 16.89
N/A
$ 20.34
$ 16.81
N/A
18.90%
10.60%
N/A
8.30%
16.40%
Bulk Warehouse
Manufacturing
High Tech/R&D
retaIl
$
$
3.14
N/A
3.43
$
$
7.29
N/A
12.71
$
$
3.70
N/A
8.92
10.40%
N/A
12.50%
Downtown
$ 8.50 $ 15.06 $ 11.78 3.10%
Neighborhood Service Centers $ 11.16 $ 23.00 $ 13.44 12.40%
Community Power Center
$ 8.00 $ 21.10 $ 11.42 19.50%
Regional Malls
$ 14.57 $ 38.50 $ 16.64 5.00%
deVeloPment land Low/Acre High/Acre
Office in CBD
$ 875,000.00 $ 2,000,000.00
Land in Office Parks
Land in Industrial Parks
Office/Industrial Land - Non-park
$
$
$
260,000.00
108,000.00
165,340.00
$
$
$
435,000.00
216,000.00
305,000.00
Retail/Commercial Land
Residential
$ 130,680.00
N/A
$ 1,045,000.00
N/A
Martin/St. Lucie Counties At A Glance
(Rent/SF/YR) low High effective avg. Vacancy
doWntoWn offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
suburban offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
IndustrIal
$ 16.00
$ 16.00
$ 13.00
$ 16.00
$ 16.00
$ 12.00
$ 23.00
$ 23.00
$ 16.00
$ 20.00
$ 20.00
$ 15.00
$ 18.00
$ 18.00
$ 14.00
$ 18.00
$ 18.00
$ 13.00
20.00%
20.00%
20.00%
30.00%
30.00%
30.00%
Bulk Warehouse
Manufacturing
High Tech/R&D
retaIl
$ 5.00
$ 5.00
$ 5.00
$
$
$
8.00
8.00
8.00
$
$
$
6.00
6.00
5.00
50.00%
50.00%
50.00%
Downtown
Neighborhood Service Centers
Community Power Center
Regional Malls
$ 18.00
$ 12.00
$ 14.00
N/A
$ 26.00
$ 16.00
$ 18.00
N/A
$ 20.00
$ 17.00
$ 15.00
N/A
10.00%
30.00%
25.00%
N/A
deVeloPment land Low/Acre High/Acre
Office in CBD
Land in Office Parks
Land in Industrial Parks
Office/Industrial Land - Non-park
Retail/Commercial Land
$
$
$
$
$
200,000.00
150,000.00
50,000.00
50,000.00
100,000.00
$
$
$
$
$
400,000.00
250,000.00
100,000.00
250,000.00
500,000.00
Residential
$ 10,000.00 $ 1,000,000.00
2012 Global Market Report n www.naiglobal.com 91