Market-rate rentals, a growing option Downtown | Jax Daily Record | Jacksonville Daily Record

As of April, 5,220 people lived in downtown Jacksonville.

The number of downtown residents is approaching 10,000 – the residential density that many officials, including JAX Chamber CEO Daniel Davis and Downtown Investment Authority CEO Lori Boyer, see as a threshold for housing in the urban core becomes autonomous.

Boyer said 10,000 to 12,000 residents will allow the downtown market to attract essential services such as grocery stores and a pharmacy, as well as more retail, dining and entertainment.

“Getting housing to a robust standard will make it easier for these retail businesses to be successful,” Boyer said.

Since 2010, much of the demand and construction in downtown housing has focused on affordable multi-family housing and workforce housing.

But there are signs that market-rate rentals in the city center are becoming sustainable and contributing to the overall residential makeup of the urban core.

For developers to build profitable rentals at market rates downtown, Boyer said the magic number is a rent of $ 2 per square foot.

A report submitted to the DIA by commercial real estate services company CBRE Jacksonville shows that as of April 1, five downtown residential projects met or exceeded the average price of $ 2 per square foot:

• Vista Brooklyn, a 10-story, 308-unit tower at 200 Riverside Ave.

• Bishop Gate, a three-building, 145-unit apartment complex in Riverside

• Broadstone River House Apartments, an apartment community of 263 units on the South Shore

• 1230 Hendricks Ave., with 345 apartments, parking and 5,500 square feet of retail space.

• The Residences at Barnett, the 18-story tower and 107 apartments at 112 W. Adams St.

In 2010, CBRE identified four multi-family residential projects under development. The average rent per square foot ranged from 98 cents to $ 1.28.

In 2014-2015, that average jumped to $ 1.22 per square foot in the low end and peaked at $ 1.57 between six developments.

In April of this year, the CBRE study shows that the lowest average rent per square foot downtown is $ 1.57. The highest is Broadstone River House at $ 2.20 per square foot.

The average rent in the city center continues to grow with supply. CBRE has listed 24 downtown residential projects under development or recently completed, from the Cathedral Quarter on the North Rim to San Marco on the South Rim.

While market rate is now an option for developers, affordable housing and workforce housing like Vestcor Companies’ “Loft” brand apartments in LaVilla and Brooklyn continue to be in demand.

Vestcor, a member of the Northeast Florida Builders Association, is one of three companies, including Blackwater Capital LLC and JWB Real Estate Capital, that have submitted bids to develop townhouses for sale on municipal properties in LaVilla.

Single-family home development is being pushed in LaVilla, and Boyer said it could also be viable in Brooklyn, the Cathedral Quarter and areas on the South Rim.

However, downtown property is “too valuable” for low-density housing, she said.

“As downtown Jacksonville continues to grow and evolve with the rest of Northeast Florida, the Northeast Florida Builders Association strongly supports the development of new housing, both rental and for sale,” said said NEFBA President Sean Junker.

“Creating a positive growth environment for builders and residential developers is critical to the economic success of the downtown core,” he said.

Multi-family housing construction The city center has been largely mid-rise rental apartment complexes. But rising rental prices could spark renewed interest in condominiums, including high-rise buildings, Boyer said in an interview on July 9.

One possible location for high-rise residential development is Bay Street on the site of the Old Duval County Courthouse and Old Jacksonville City Hall. CBRE performs an analysis of optimal and optimal use of properties, and the city collects information on existing easements and utilities.

Boyer said she wanted the DIA board to have this information by September so that development parameters could be part of developer requests for proposals by October.

“We hope to have it on the market by October. CBRE does the marketing for us and they do the highest and best usage analysis. But we’re hoping that at least some of this type can be tall, ”Boyer said.

If projects like residential skyscrapers gain traction, Boyer said it could help achieve a higher density downtown.

“And if the area behind the Hyatt (Regency Jacksonville Riverfront) can support skyscrapers and we can get that increased density, we’re reaching our 10,000 or 12,000 downtown residents much faster,” Boyer said.