August 15, 2016
With its spectacular setting along the St. Johns River, downtown Jacksonville is the sparkling center of the community. Iconic towers and the striking Main Street Bridge are part of the city’s character, and so is its constant evolution. The downtown district, as well as the JAX beaches, are home to some of the area’s most familiar landmark buildings.
Some changes are happening along the city skyline, with new construction and renovation projects in prominent downtown locations as well as in beachfront multifamily.
Sale of The Strand
An important event in the local high-rise market was the recent, record-breaking sale of The Strand. This residential tower, built in 2007, was sold for $64.6 million, which comes to $219,000 for each of its 295 units. This well-known building was the only high-rise tower constructed downtown in the last decade, and some observers suggested that it might be more than the market can bear.
Indeed, there has been a move toward more mid-rise construction for multifamily in recent years, but this sale is seen by some as an indication that the demand for residential towers may be resurging.
Broadstone River House
Nearby, the sale of land was just finalized for a $26 million project planned on the Southbank. While hardly a high-rise at just 6 stories, the development will be on the water, with open views of downtown Jacksonville, becoming a part of the cityscape. Plans include a plaza that will connect the property with the Riverwalk.
Developments of this scale will likely remain the norm for multifamily in Jacksonville, but it will be interesting to see what effect deals like the Strand’s sale have on development, and the attitude toward more large-scale construction.
Some major multifamily projects in the works around the metro area:
1) Ravella at Town Center —plans call for a single building with 2 courtyards, offering a total of 347 units.
2) The Loree in Bay Meadows —modern and convenient; near the St. Johns Towncenter
3) Lakeview at River City Marketplace —324 luxury units in a low-rise development in north Jacksonville
Meanwhile, the Jacksonville market is in the top 20 in the nation for rent growth. Growth is at 4.4%, up from 3.7% in 2015. Vacancy rates are under 5%, and absorption continues a positive trend.
These numbers, along with declining unemployment and a growing labor force, bode well for multifamily in the metro area. As lifestyle amenities and retail continue to be added in the downtown area- particularly along the riverfront, we can look for more new development there as favorable conditions inspire confidence among investors.
And based on the recent sale of The Strand and a preference among younger demographics for a higher density urban lifestyle, it may also inspire plans for residential towers in the city center. So take a good luck at our skyline today; change is coming, guaranteed.