Current trends in multifamily development in the Jacksonville area, according to Dan Allen, senior vice president at CB Richard Ellis, are toward better property amenities. Amenities such as attached garages, indoor basketball courts, larger health clubs, cinemas, putting greens, cabanas, wine cellars, lap pools and enhanced business centers are what tenants are looking for. Enhanced unit amenities such as condo-type floor plans, hardwood floors, larger kitchens with side-by-side refrigerators, smooth top stoves, large pantries, advanced technology services, surround sound wiring and concierge services are also becoming common place.

Significant developments in the area include The Villas at St. Johns, a 257-unit mid-rise on the St. Johns River in the Riverside Avondale area. "It is the first urban apartment construction in several decades and offers traditional architecture, four-story construction and a parking deck," says Allen. Berkman Plaza is a 206-unit, high-rise apartment community on the north bank of the downtown area adjacent to the new Adams Mark Hotel. Leasing will begin at the end of this year and, according to Allen, the project will offer upscale living to the downtown worker.

New developments in the southeast quadrant include The Heritage at Deerwood, a 210-unit, "big house" design with direct access garages and large condo-like floor plans that range from 1,288 to 1,848 square feet. The Wimberly is the first fully amenitized apartment community for the active lifestyle resident. This 322-unit complex also features amenities such as hardwood floors, side-by-side refrigerators, smooth top stoves and wine racks. Alta Deerwood, Reserve at Pointe Meadows and James Island also feature complete amenity packages with well-designed floor plans and a club atmosphere for those who are active, but want to be pampered as well. The 200-unit Avenue Royale, although smaller, still has full amenities, direct entries and excellent finish for the discerning resident. St. Johns Estate, with 264 units, features high-end amenities with 8-foot ceiling plates and reasonable rents as a value choice to prospective residents.

The Westside and Orange Park markets have seen only one new development previously, but now have another one coming on line, according to Allen. The Plantation Bay, a 276-unit complex in Westside, has significant golf course frontage with "big house" construction. Lighthouse Court at Fleming Island, with 500 units, offers choices to the new "job generators" in the area.

The majority of new development this year, according to Allen, is primarily taking place in the southeast quadrant where 72 percent of the 2,497 new market rate units will be delivered. In 2002, the total delivery schedule will go down, but the percentage delivered to the southeast quadrant will be 70 percent or higher, he says. "Developers are attracted to the southeast quadrant because of job creation, suburban office construction and retail amenities that are offered to residents," says Allen.

"In the year 2000, total growth occurred in the southeast quadrant," says Allen. The Wimberly, Reserve at Pointe Meadows, Cape House II, The Heritage at Deerwood and St. Johns Estate all provided new units to the market. "But the total delivery of market rate units was down and less than 800 units."

New developers to the Jacksonville market are Wood Partners, Crescent Resources, VSB, Foote Development and Dayco. Cumberland Allegiance and Lincoln Property Company are developers that have returned to the Jacksonville market. "New developments are primarily high-end with ample amenities," says Allen. "Residents are young professionals, renters-by-choice and empty nesters."

Class A rental rates range from $700 to $1,100 for a one-bedroom unit, $871 to $1,300 for two bedrooms and $1,030 to $1,700 for three bedrooms. "The high end of the range has moved up recently with the addition of The Heritage at Deerwood and The Villas at St. Johns on The River," says Allen. He predicts that these rates will move even higher with the advent of Berkman Plaza, a riverfront high rise where rents will average nearly $1.50 per square foot. Class B rents range from $531 to $697 for one bedroom, $692 to $894 for two bedrooms and $765 to $1,114 for three bedrooms.

The vacancy rate for Jacksonville as of the fourth quarter of 2000 was 6 percent, according to the CB Richard Ellis Market Survey. M/PF Research - USA indicates the vacancy rate was 5.35 percent for the fourth quarter of 2000.

When asked about the submarkets to keep an eye on in the future, Allen says the urban market should be interesting as the first new community, The Villas at St. Johns, comes on line. Berkman Plaza and several others are also in the planning stages. "The question is, as always, how much demand is there?" Allen notes.

Other markets to keep an eye on are the Northside and Arlington areas, which offer opportunity because new properties have not been built there for some time. Another market to watch, he says, is the southeast quadrant. "The southeast quadrant will provide an interesting study of supply and demand as the market absorbs the largest production of new units since 1997," says Allen. It will be necessary for Jacksonville to continue annual job production in the 15,000 to 23,000 range as it has for the last several years, he says. He also predicts that the southeast quadrant will continue to be the favorite, although the current supply will create a softening. "Site possibilities are also more difficult with concurrency and fairshare in play," says Allen.

Condo conversions are also a growing trend and have appeared in Ponte Vedra at three communities: The Courts (now Grand Cay Villas), Ocean Links and Marsh Cove. The Grand Reserve in the southeast quadrant is currently under conversion. In the future, condo converters will look for unique properties, says Allen.

Developers will look for niche possibilities in other submarkets. "We should see land acquisition or new communities in the Westside, Orange Park, Arlington and the Northside," he says. "Interest will continue in St. Augustine and Amelia Island."

Dan Allen is a senior vice president with CB Richard Ellis.


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