Still, Jacksonville’s office vacancy rose
to 16.7% through the third quarter, up
from 14.8% at midyear and 13.3% since
the end of 2007, according to CB Richard Ellis. New suburban space in the
Southpoint and Clay County submarkets has added to the area’s existing inventory of more than 23 million sf.
Jacksonville’s skyline has three of the
state’s five largest office towers—
Bell-South Tower, Bank of America Tower
and the Modis Building—containing
roughly a million sf each. Downtown vacancy, which once exceeded the 20%
mark, is down to 17% through the third
quarter. Education and healthcare companies have emerged as top users of office space, while the previously dominant
banking and finance sector makes up
roughly 10% of the business base.
“There are a lot of large tenants moving around,” observes Traci Jenks, a
local CBRE senior associate. “It is very
challenging finding tenants right now,
but deals are happening.”
Among the largest leases in Jackson-
ville so far this year is Deutsche Bank’s
decision this summer to add 125,000 sf
to its current 51,000-sf suburban investment banking operations center. The
$12-million investment is expected to
generate an annual payroll of nearly
$50 million, with employment growing
from 400 initially to 1,000 over the next
three years.
Office users of all sizes have taken up
space throughout the area this year,
helping Jacksonville rebound from negative 34,000 sf of absorption at midyear
to minus 430 sf through the third quarter. CBRE states that negative absorption is partly because of increases in
suburban sublease space, offset by
50,000 sf of positive net absorption
Downtown.
Local office brokers say they expect a
QUICK FACTS ON JAX
• Jacksonville has four interstates, several major highways and three major rail lines
connecting freight to the rest of the country. An international airport and expanding
seaport also provide strong connections to foreign trade.
• Local and state authorities are investing more than $2 billion in infrastructure expansion,
including the new Interstate 10/95 Downtown interchange and the extension of the I-295
beltway.
• JaxPort totals 1,400 acres and is one of the largest ports in Florida, handling the
second-largest amount of vehicles in the US.
• CSX, based in Jacksonville, is the largest railroad east of the Mississippi River, reaching
more than 70 river, ocean and lake ports plus 200 short-line railroads.
• Cecil Field, a former Navy master jet base, is being transformed into a new commercial
center with 4,500 acres marked for industrial, office and manufacturing development.
Source: Jacksonville Economic Development Commission
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