by Miranda G. McLeod
Staff Writer
When the National Football League announced that Super Bowl XXXIX would be played in Jacksonville, many knew the game that draws an international audience of tens of millions would help put Jacksonville on the map in many facets.
People would get to know the area’s natural amenities, business-friendly atmosphere and solid economy that seems to stay immune from national mini-recessions.
Those that came also discovered a secret that’s not-so-secret anymore — there was abundant, developable land in the Jacksonville area. But, it’s not so cheap anymore and it’s not so abundant. That fact was driven home at the last meeting of the Downtown Neighborhood Council of Realtors.
Bob Crenshaw and Mark Williams of Crenshaw Williams Appraisal Company talked to the Council about the commercial side of real estate appraisals.
“Commercial real estate starts with jobs,” said Crenshaw, citing the Super Bowl as a diving board for the industry. “People don’t realize the impact of the Super Bowl.”
Crenshaw said after the game his company started receiving calls from across the country from people inquiring about Jacksonville real estate.
“Real estate is not going down here,” said Crenshaw. “There has been a decrease in volume, but not in profits. There is positive job growth that is driving the market, along with the residential market.”
He said new multi-family construction is leveling off because of dwindling land availability. That diminishing supply of land in community development districts — where developers are buying land with bonds — has created a high demand for land, pushing the cost of it “off the chart.”
That increase has resulted in a new demand for land on which to build rental properties. However, some of those developments don’t require much land, such as the older buildings Downtown that are being renovated and converted into for-lease apartments. Other examples include the new residential towers going up on both sides of the river — The Strand, The Peninsula and San Marco Place, for example — as well as planned towers such as Berkman Plaza 2 and The St. John.
“Rental rates are going up because supply is going down,” he said. “Older properties may see a decrease in cost. It’s an exciting time to be in Downtown.”
Williams said that just as apartment conversions have become a popular idea, so has office conversion and that has people nationally and internationally looking to invest in Downtown. The Barnett Bank building, the Laura Street Trio and the old SunTrust building are examples of a commercial developer — in this case, the Kuhn Co. out of Orlando — buying an older building and converting it into a mixed-use, for-lease, modern tower.
If there’s one potential hindrance to too much more commercial development and renovation, Crenshaw says it’s the escalating cost of commercial insurance, something that may prove to give investors that hardest time.
“Commercial insurance has a dark cloud around it — you can’t get it. And rates are going crazy,” said Williams. “Industrial property insurance rates have been raised four times in the last year.”
All of this new business, much from out-of-town, has had a positive effect on another industry, too. The local banking industry is doing well thanks to an influx of investments. Crenshaw said Jacksonville brings in money from all over the country, with 50-100 banks putting money into the city.