While the COVID-19 pandemic is disrupting some industries, it’s creating a surge in demand for e-commerce businesses as consumers shop more online.
That’s a positive for Jacksonville’s economy as it attracts new e-commerce companies, participants said in an Oct. 19 webinar presented by JAXUSA Partnership and the Jacksonville Port Authority.
Even during the pandemic, companies are looking for facilities in Jacksonville to respond to new demand, said Aundra Wallace, JAXUSA president, and Jacob Horsley, senior director of industrial brokerage services at Cushman & Wakefield.
“We’re chasing or working with about 43 different prospects,” Wallace said.
He said 21 of those are in the category of advanced manufacturing and 12 or 13 fall into the category of advanced transportation or logistics centers for companies.
“While I cannot tell you the projects specifically, I like the projects I’m seeing,” Wallace said.
Horsley said he has 14 active projects within the Jacksonville market.
“The pipeline and the deal velocity in the market is incredibly strong,” he said.
Without giving details, Horsley said his projects include an 85,000-square-foot warehouse project off Powers Avenue on the Southside that is expected to be announced later this week.
Jacksonville has attracted some big e-commerce businesses in just the last couple of years, including Amazon.com, which has opened or announced plans for nine facilities.
Other recent projects include distribution centers for furniture retailer Article.com and home furnishing retailer Wayfair LLC.
Wallace said Wayfair, which opened its Westside distribution center in June, has been impressed by the labor pool it found in Jacksonville.
“Other branches of their company said they need talent and they want to poach talent from the Jacksonville region,” Wallace said.
Jacksonville’s labor pool is benefiting from new and younger residents moving to the area in search of opportunities during the pandemic, Wallace said.
He said the area had a net population gain of 10.7% between April and August and 71% of new residents are under age 40.
“As people are leaving high cost, high-density cities, our region stands to benefit greatly,” he said.
Besides available labor, e-commerce companies are attracted to Jacksonville because of its logistics infrastructure, including the port, railroads and interstate highways. And access to industrial properties “is of utmost importance,” Wallace said.
He said a searchable database of available properties and sites is helping JAXUSA recruit new businesses.
“The launch of this tool is essential during the pandemic in lieu of making an actual visit to Jacksonville,” he said.
Horsley said e-commerce businesses have leased 6 million square feet of space in the Jacksonville market in the past three years and he expects another 1 million square feet to be leased by the end of this year.
Jacksonville’s total industrial market of about 102 million square feet had a direct vacancy rate of 6.6% at the end of the third quarter, Horsley said.
“Vacancy has ticked up the last couple of years,” he said. “A large percentage of that is due to new construction activity.”
Horsley expects the vacancy rate to fall back closer to 5% by the end of this year.
He said the industrial market in Jacksonville has been strong during the pandemic with 3.77 million square feet leased so far this year, continuing a trend of leasing activity over the past five years.
