THE U.S. GULF COAST & ITS VITAL INTERSTATE-10 CORRIDOR

After a tumultuous decade filled with hurricanes, an oil spill, and a national recession,

the commercial real estate landscape in the five coastal states along the Gulf of Mexico

and the Interstate-10 Corridor has emerged with more opportunity than ever. Population

growth, a strong labor force and a lack of supply in many markets across Texas, Louisiana,

Mississippi, Alabama, and Florida have converged to create unique pockets of interest for

potential investors.

In order to help our client’s make more informed real estate investment decisions, Coldwell

Banker Commercial has compiled a market overview of seven major epicenters in the I-10

Corridor. We reviewed everything from vacancy rates and trends to local economic factors

at play in the following market regions: San Antonio, Beaumont/Southeast Texas, New

Orleans, Baton Rouge, Pensacola, Tallahassee, and Jacksonville

Texas, Louisiana, Mississippi, Alabama, and Florida share more than just a location along

I-10; they share a thriving micro-economy with industries focused around energy,

petrochemicals, fishing, aerospace, agriculture, and tourism. Some of the larger cities along

the I-10 Corridor, including Houston, Beaumont, Lafayette, Baton Rouge, New Orleans,

Biloxi, Mobile, Pensacola, and Jacksonville are thriving meccas for American business. The

Port of South Louisiana and the Port of Houston are known to be two of the busiest ports

in the world.

As oil and gas deposits were discovered along the coast and offshore, the Gulf Coast —

and in particular, Texas — has become the heart of the U.S. petrochemical industry. Energy

stalwarts Phillips 66, ConocoPhillips, Valero Energy, Tesoro, and Kinder Morgan all have

corporate locations between San Antonio and Beaumont. It is economic diversification,

however, that has fueled population growth for the entire region. For example, Fortune

500 companies such as Fidelity National Financial, CSX, Sysco, and USAA all call the

corridor home. Here we look at Jacksonville, Florida market.

JACKSONVILLE, FLORIDA

In northeast Florida, Jacksonville is undergoing an economic boom. The city has benefitted

from multiple industries and employers driving its growth. Logistics is a significant factor

buoyed by three major ports (Talleyrand, Blount Island, and Mitsui OSK), whereby the city

exceeded 1 million TEU shipments in 2017. The region is also home to CSX rail, as well as

Norfolk Southern and FEC rail lines.

Distribution, healthcare, financial services, and the military all play pivotal roles in the local

economy. Amazon has opened four facilities in the market with a 2+ million square-foot

facility, providing employment to thousands of locals. Hillwood (a Perot Company) is the

master developer of Westside Cecil Commerce Center with entitlements and infrastructure

in place for 34 million square feet of development.

Growth in the healthcare industry has been led by the Mayo Clinic & Hospital, with its

$100 million specialized transplant facility. Baptist Healthcare also has two major hospital

facilities – one in downtown and another on the Southside.

The banking and insurance industries have been mainstays in Jacksonville, as Deutsche

Bank, Bank of America, Wells Fargo, and EverBank all maintain a large office presence, while the BCBS payroll tops 11,000 people. The U.S. Military has long been a part of Jacksonville’s heritage, with more than 50,000 active duty, reserve, and civilian men and women.

A tight market and increasing rents have resulted in new office construction. The north

side of Jacksonville and Clay County lack “Class A” office product and regional economic

development leadership has asked for support to bring supply. Flex warehouse space is a

high-growth sector and new product is leased up before completion. The labor shortage

has been a factor in limiting supply, as is available capital to the local developers who

dominate the flex market.

There are several reasons why a company would and should consider expanding or relocating to Northeast Florida. Most notably, the area’s pro-business environment is encouraged by and supported by Governor Rick Scott. The state also offers numerous tax incentives and credits to businesses moving or expanding to Jacksonville. . Moreover, Florida does not have state income taxes. Additionally, Jacksonville has the youngest average demographics in Florida and continues to attract young professionals and talent from around the nation.

For the full report, go to  https://www.cbcblueprint.com/public/NRT-I-10-Report-R5.pdf