Photo by Jerry KING
On the upside, Jacksonville’s industrial market was more active in the first quarter of this year — with showings, requests for proposal and conversations with our clients and peers — than the entire second half of 2025.
We have more than 12 million square feet of tenants in the market considering warehouse space.
Those tenants have a number of good options in Jacksonville given the amount of speculative development in the past few years.
We started 2026 with vacancy rate at 10.2%, and a good portion of that vacancy was due to 2025 construction when deliveries totaled 6.96 million square feet, the second biggest year for deliveries in the past five years.
We’ve seen a few tenants sign leases this year, but there are still many prospects stuck in the decision-making process.
In fact, the time it takes from initial proposal to get a lease signed is the longest I have seen in my 20-year career.
The main challenge we face involves qualifying the prospects in terms of their credit and timing. Credit is critical for a landlord and its investors/lenders.
A majority of vacancies are in new buildings that require some level of tenant improvements to allow a tenant to operate their business.
Increased power, air-conditioned warehouse, additional office and additional dock equipment are common requests lately.
They come with a big cost, and landlords need to make sure a tenant has strong credit before making that investment.
No property owner wants to get stuck with a lease default and improvements the next tenant most likely will not need.
There are many factors that influence decision-making, and the time needed to get a lease signed is roughly double what it was three years ago.
Some level of risk goes into every business decision, and our job is to provide as much information and advice as possible to help our clients understand the risk profile to make the best decision.