Well, I hope everyone had a great July 4th weekend and a few days off to cut loose. Now that the BBQ’s are over and the fireworks have stopped going off in the neighborhoods, it’s time to get back to business!
A couple months ago, I would have told you that our market had hit bottom and we would see an elongated “U”-shaped recovery here in Jacksonville, but after seeing some recent sales comps and a couple new industrial buildings hit the market I don’t believe we have hit bottom yet!?!?! I have started to see a couple banked-owned properties hit the market near the beaches and on Jacksonville’s northside, but I have also been told directly by a couple local and national banks that the industrial delinquency rate is very limited compared to the other food groups in commercial real estate (retail, office, & apartments). There has been an uptick in activity over the last 6 months, but the uptick in closed transactions hasn’t happened yet. There’s a whole lot of talk and very little action, which may not be a terrible thing. I figure as long as businesses are willing to look at the market and see their options, some of them will come off the sidelines and complete a deal.
Most of the industrial activity has been under 20,000 SF, with the majority under 10,000 SF. When I shared this information with a colleague, he shed some light on the subject by saying that if smaller companies have money to relocate and better their situation, larger companies do, too. They may just not be reacting to their needs at this time, but will soon be back in the game. It made a lot of sense to me, but we will have to wait and see if it happens.
Recently, Rob and I have seen some more investors come off the sidelines and start making offers on Jacksonville’s high-quality industrial facilities in the “A”-rated locations around town. I believe this is an indicator of good things to come and says a lot for our city. Jacksonville has a lot of potential, and I believe that in 10 to 20 years, it will be one of the great industrial towns on the East Coast. It has the makings of a great city - an educated work force, plenty of available land, some of the best infrastructure in the U.S., major rail intermodal yards, an international airport, and deep-water shipping ports. The only thing it needs is economic/job growth… well, maybe not the only thing, but I think you get the picture. We will all survive this difficult time and become better people for it, I believe.
Until next time, I wish everyone well, and I look forward to listening to any and all of your comments or questions.
Jacob Horsley
NAI Commercial Jacksonville
Industrial Group
