Downtown Jacksonville Commercial Real Estate: A Market Evolving

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Downtown Jacksonville is undergoing a transformative surge, fueled by ambitious development, a challenged office market, notable economic achievements, and a cautiously optimistic outlook for late 2025 and beyond. As the urban core redefines itself, commercial real estate stakeholders are navigating opportunities and hurdles. This article lists current and future developments in Jacksonville’s urban core, examines the state of the office market, highlights key victories, and summarizes the future for Downtown’s office sector.

Development Activity: A Comprehensive Pipeline

Downtown Jacksonville’s urban core is alive with development projects, reshaping the Northbank, Southbank, LaVilla, Brooklyn, and Sports and Entertainment Districts. Below is a comprehensive list of current and future developments, all with completion or groundbreaking dates post-April 2025, based on 2024/2025 reports:

  • Riverfront Plaza: A $27 million public park on the former Jacksonville Landing site, featuring a cafe, playground, beer garden, and bike/pedestrian connections. Phase one construction continues, targeting completion in late 2025.
  • Gateway Jax Pearl Street District: A $500 million mixed-use project across five blocks in the NorthCore, with Block N11 (205 apartments, 24,086 square feet of retail/commercial) under construction since October 2024, targeting 2026 completion. Future phases include a 22-story high-rise starting in spring 2025, with a $2 billion total buildout planned.
  • Union Terminal Warehouse: A $72 million adaptive reuse of the 1913 structure at 700 E. Union St., delivering 228 apartments, 11 light industrial spaces, and 4,000 square feet of retail, progressing toward late 2025 completion.
  • One Shipyards Place: A 137,000-square-foot Class A office building, managed and leased by NAI Hallmark, offering 50,128 square feet of leasable space. Construction is ongoing for a 2026 opening, marking Downtown’s first new office tower in over a decade.
  • UF Graduate Campus (Levin College of Law and College of Medicine): A University of Florida campus in La Villa, repurposing the Interline Brands building at 801 W. Bay St and adding new construction around the Prime F Osborn III Convention Center. Programs include law, medicine, engineering, and an MBA. Classes scheduled to start Fall 2025 with campus build out continuing through 2026.
  • Artea at Southbank: A $96.9 million, 340-unit transit-oriented apartment complex near the Kings Avenue Skyway station, with a 425-space parking garage and amenities. Targeting summer 2025 completion.
  • One Riverside: A $250 million mixed-use project at 1 Riverside Ave., with a $59.9 million first phase including 225 apartments and a Whole Foods Market, set for September 2025 completion.
  • Toll Brothers at RiversEdge: A $693 million Southbank development with 40 luxury townhomes under construction, part of a larger plan for 1,170 residential units, 200 hotel rooms, 200,000 square feet of office, 121,400 square feet of retail, and a 125-slip marina, targeting 2026-2027 completion.
  • RISE Doro: An $80 million, eight-story, 247-unit mixed-use apartment development at 960 E. Adams St. in the Sports and Entertainment District, rebuilding after a 2024 fire, with 7,400 square feet of retail and a 284-space garage, aiming for 2026 completion.
  • The Hub Brooklyn: A $2.46 million project at Riverside Avenue and Forest Street, developed by Southern Grounds & Company, with site work underway for a 2026 opening, including commercial and public spaces.
  • Laura Street Trio: A $175.1 million adaptive reuse of historic buildings at Laura, Forsyth, and Adams streets, combining renovation with new construction. Revised incentives were proposed in 2024, with construction planned for 2025 and completion in 2027.
  • American Lions Tower: A 44-story, 332-unit apartment tower on a 1-acre Riverfront Plaza parcel, with a 7,500-square-foot restaurant and 330-space garage, valued at $166.6 million. Construction is in review, targeting 2027 completion.
  • Ambassador Hotel: A $17 million redevelopment of the historic hotel at 310 W. Church St., acquired by Gateway Jax in March 2025, into a 105-key hotel with a high-end restaurant, bar, and conference space, partnered with Indigo Road Hospitality Group, aiming for 2026 completion.
  • NoCo Center Redevelopment: Gateway Jax’s plan for a full-service grocery store and mixed-use development in the NorthCore, with groundbreaking planned for late 2025 and completion in 2027.
  • McCoys Creek Improvement: A public project to enhance McCoys Creek, running beneath the former Florida Times-Union building, with a fall 2025 completion date.
  • Emerald Trail: A $149 million, 30-mile bicycle and pedestrian network connecting 14 neighborhoods to Downtown. Segment 3 (San Marco to Southbank) is under construction, with completion set for late 2025, and additional segments planned through 2029.

These projects, totaling close to $3 billion in investment, reflect a commitment to mixed-use, residential, office, and public spaces, enhancing Downtown’s vibrancy.

State of the Office Market: A Challenging Landscape

Downtown Jacksonville’s office market is under pressure, driven by hybrid work trends and outdated inventory. In Q1 2025, Jacksonville’s overall office vacancy rate was 22.0%, with Downtown’s rate at 26% for its 7.9 million square feet, nearly double Miami’s 11.8% and Tampa’s 17.6%, according to 2025 DIA reports. This reflects a 60-basis-point increase from Q1 2024’s 25.4% Downtown vacancy rate, signaling ongoing softening.

Leasing activity declined significantly, dropping 44.3% in Q1 2024 compared to Q1 2023, a trend continuing into 2025 with subdued demand. Most available space is in pre-2000 buildings, lacking modern amenities, as well as a perceived lack of amenities in downtown is currently deterring tenants.  Office-related job postings rose 27.3% in Q1 2024, driven by consulting and finance sectors, suggesting latent demand.

Big Wins: Economic Catalysts

Downtown Jacksonville achieved significant milestones in 2024-2025. Gateway Jax’s Pearl Street District secured a $98.5 million incentive package in August 2024, projecting a $750 million annual economic impact with over 1,000 residential units and 100,000 square feet of retail. The UF graduate campus, potentially enrolling 20,000 students, will drive economic benefits starting in 2025. JaxPort’s 2024 upgrades to the SSA Jacksonville Container Terminal solidified the region’s logistics hub status, indirectly supporting Downtown by attracting firms. NAI Hallmark’s management of One Shipyards Place positions Downtown for premier office tenants.

Future Outlook for the Downtown Office Market

The Downtown Jacksonville office market faces a challenging yet hopeful path in late 2025 and beyond. Deloitte’s 2025 Commercial Real Estate Outlook indicates 68% of industry leaders expect improved leasing, rental growth, and vacancies, driven by a “return to office” movement. However, high vacancies and limited modern inventory will persist without strategic interventions.

New Class A developments like One Shipyards Place will introduce high-quality spaces, attracting tenants seeking modern amenities. The UF graduate campus will increase foot traffic and demand for office spaces by 2026. Infrastructure improvements, including the Emerald Trail and parking solutions, will enhance accessibility, making Downtown more appealing to businesses. Industrial strength, with 5.0 million square feet under construction and vacancy rates stabilizing at 3-4%, will support economic resilience, potentially freeing capital for office investments.

To overcome high vacancies, adaptive reuse of older buildings and tenant incentives are critical. Without these, recovery may lag, as hybrid work continues to suppress demand. By leveraging new developments and economic drivers like JaxPort and population growth, Downtown’s office market can stabilize, positioning it for gradual growth by 2027.

Conclusion: A Downtown on the Rise

Downtown Jacksonville is poised for progress, with a robust pipeline of developments like Gateway Jax’s Pearl Street District, One Shipyards Place, Union Terminal Warehouse, Riverfront Plaza, the Emerald Trail, and the UF graduate campus with the Levin College of Law driving transformation. Despite a challenged office market with high vacancies, economic wins and infrastructure enhancements signal resilience. With strategic interventions, Downtown’s commercial real estate market is set to evolve, making it a focal point for investors and businesses in late 2025 and beyond.

If you would like to learn more, please reach out to st@naihallmark.com

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April 29th, 2025