The Jacksonville industrial market is on fire. Headline vacancy is 4% but actual vacancy in class-A & B product is closer to 1%, which is far less than what is needed for the market to function efficiently. Functional B/C quality availability is also low. We are seeing many landlords in the class-C space force tenants to take space as-is, or with tenant improvement packages that are entirely financed thru increases in rent. Small occupiers in the warehouse condo space are putting in offers on units sight unseen for fear of missing out on much-needed space. As the backup at America’s largest ports continues to worsen heading into the holidays, we believe Jacksonville will ultimately be a beneficiary of supply chain revisions aimed at diversification to help avoid issues like this in the future. In short, we see no reason that the Jacksonville industrial market should slow any time soon.
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