The Jacksonville office market has remained steady since the beginning of 2018
Although seeing an increase in vacancy and negative net absorption in the 2nd quarter. The vacancy rate currently sits at 8%, and has hovered around 7.6% since mid-year 2017. The increase in vacancy rates are also displayed by the net negative absorption of 110,135 square feet, largely attributed to the vacancy created by the CSX lease expiration at Southpoint, which brought more than 275,000 SF back on the market. Asking rates continue to rise, ending the 2nd quarter at $19.44 per square foot average asking rate.
Several Class B office buildings traded in Q2, with the largest two transactions occurring in the Butler/Baymeadows submarket. Sales activity is projected to remain active, with two CBD towers under contract to close early Q3. The Butler corridor continues to be the hot market in leasing activity, with tenants choosing new construction options. With multiple cranes in the air, the momentum continues Downtown with the closing of The District (30 acres multi-use with 200K SF of office projected) and a few redevelopment transactions on the horizon, including The Ambassador Hotel and Berkman Plaza II.