Jacksonville's Economic and Industrial Landscape: A 2023 Overview
As we wrap up 2023, Jacksonville's economy and industrial market have presented some noteworthy trends that deserve a closer look. From employment rates to industrial demand and market pricing, let's dive into the key highlights that shaped the city's economic landscape over the past year.
Economic Resilience Amidst Growth
Jacksonville showcased a remarkable economic resilience with an unemployment rate of 3.0% in Q4 2023, significantly outperforming the national average of 3.7%. Despite a slight increase from the previous year, the city's employment scene has been vibrant, with nonagricultural employment witnessing a 3.8% rise, translating to 30,200 new jobs. This growth was notably seen across the industrial sectors, with substantial job additions in trade, transportation, utilities, construction, and manufacturing.
Industrial Supply Dynamics
The industrial vacancy rate stood at 3.7% by the end of Q4, reflecting a mix of challenges and achievements. The year-over-year increase was largely due to new but unleased spaces hitting the market, including significant developments such as the Westside Industrial Park and Legend Point Logistics. Despite this uptick, Jacksonville welcomed a historic 7.4 million square feet of new industrial product in 2023, marking a significant milestone in the city's industrial expansion efforts.
Surging Demand and Record-breaking Leasing Activity
Demand for industrial space in Jacksonville surged, with new leasing activity reaching 2.0 million square feet in Q4 alone, culminating in a record 8.3 million square feet for the year. This was bolstered by significant occupancy gains and landmark move-ins, including those by Sam’s Club, Total Distribution, and Primark, among others. The Northside and Westside submarkets emerged as focal points for new deals, underpinning the city's industrial allure.
Market Pricing and Future Outlook
The average asking rate for industrial space experienced a remarkable 27.0% year-over-year increase, ending Q4 at $9.09 per square foot. This upward trend in rents is expected to persist, fueled by the delivery of additional high-quality industrial spaces slated for 2024. Jacksonville's industrial market is poised for robust growth, offering promising opportunities for investors and businesses alike.
Conclusion
Jacksonville's economic and industrial sectors have demonstrated significant resilience and growth throughout 2023. With a lower-than-average unemployment rate, a surge in industrial employment, and record-breaking demand for industrial space, the city is on a solid path toward sustained economic prosperity. As we look forward to 2024, Jacksonville remains a key player in the regional and national economic landscape, with its industrial market expected to continue its upward trajectory.
