State of Downtown shows thousands more residents coming but office space vacancy is high

Living rooms have overtaken cubicles as the driving force shaping downtown Jacksonville.

Downtown is gaining more residents and visitors, but office buildings are experiencing higher vacancy rates and the No. 1 concern voiced by residents and workers alike is encountering panhandlers while walking through downtown.

That's the latest take on the State of Downtown in a report released by Downtown Vision, the nonprofit that represents property-owners in the 3.9 square mile area that falls within the downtown boundaries.

Here are some key takeaways of the interactive report.

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Downtown is headed toward nearly 12,000 residents

Residential development has drawn 7,965 people to live in downtown, double what it was in 2013. When eight projects currently under construction get completed, the downtown population will swell to 11,908 residents.

"The residential community is booming," Downtown Vision CEO Jake Gordon said.

The average occupancy rate for residential buildings is 97.4% in downtown. The coming years will show whether residential demand will keep up with new housing that's rising up in locations across the expanse of downtown.

The eight projects under construction are Artea at Southbank, Independent Life tower, Johnson Commons, Lofts at the Cathedral, 1 Riverside Avenue, RISE: Doro, Four Seasons Residences, and Union Terminal Warehouse.

Gordon said as more people move downtown, they will support the growth of retail and restaurants that will make it more attractive for others to head downtown for dining and nightlife.

"I tell people who are outside Jacksonville, 'Hey, we're building a Whole Foods right now,'" he said of the grocery store that will be part of the 1 Riverside Avenue development in the Brooklyn neighborhood. "They're like, 'No, you're not.' I'm like, 'Yeah, I drive by it. It is literally happening. There are cranes in the air.'"

The post-pandemic office market has emptied out space

Back in 2019, the downtown office market flipped the script when it had a lower vacancy rate than the suburbs. That year, the vacancy rate was 14.6% in downtown compared to 17.5% in the suburbs. It didn't last.

The office vacancy rate in downtown has climbed to 25.8% this year. It's 19.6% in the suburbs. Even in occupied office space, plenty of employees are working remotely. The State of Downtown report found that nearly 43% are able to work at least some of the workweek from their homes.

"The world has changed irrevocably, in my opinion, and people want to work from home," Gordon said.

He said attracting more businesses to downtown is a goal that downtown advocates need to "lean into," but it's not unique to Jacksonville. Other cities are seeing a similar dynamic for their downtown. and it's leading to the conversion of office space to residential units.

Downtown visits are rebounding after COVID-19 plunge

This week's game between the University of Georgia and the University of Florida will be one of the busiest weeks for downtown visitors.

On an annual basis, the State of Downtown report shows a high-water mark of 23 million visits in 2018. That fell in 2020 to less than 12 million visitors during the COVID-19 pandemic.

It's grown since then to 18.5 million visitors in 2022. The report shows that about 27% of downtown visitors traveled more than 250 miles. Gordon said there is room to grow more of those visits.

"There are a lot of great people trying to move us forward, but I think collectively as a city, we have underinvested in our tourism community," he said.

He said the Florida-Georgia game will draw a wave of visitors but from a visitor experience perspective, "We could do better."

"Obviously, we have a great downtown community and it's amazing, but at the same time, it makes me uncomfortable that we are hosting this world-class event and it's not as if there are world-class amenities around it," he said.

"If you focus on the visitor experience, that helps the residents, that helps the office workers, that helps the parkgoers," he said. "It helps everything."

The waterfront tops the appeal of being in downtown

The best part about living in downtown is the access to the St. Johns River and its waterfront, followed by the ability to get around on foot and by bicycle, according to the survey of residents by Downtown Vision for this year's report. The upside of living downtown also is the urban vibe, the restaurants and being close to work.

For the riverfront, the city has been working on plans to create a network of riverfront parks and extend the Northbank Riverwalk all the way to the sports complex.

Panhandling remains a concern

If downtown's walkability is a big attraction, the flip side is the panhandling that people encounter while on downtown sidewalks.

That presence of people panhandling and loitering continues to be the cited as the worst thing about living in downtown followed by "feeling unsafe," lack of retail and shopping, lack of cleanliness, and businesses not being open in the evening or weekends.

Mayor Donna Deegan and City Council members have been exploring ways to reduce homelessness. A newly formed council special committee will examine ways to pay for potential solutions.

This article originally appeared on Florida Times-Union: Downtown Jacksonville has more residents coming