Proving that COVID was not a prescription for failure, retail real estate demand is healthy, including in Jacksonville – and Downtown.
“We are the darling of commercial real estate right now, and that can’t always be said,” Franklin Street Senior Vice President Carrie Smith told a breakout session of the 2025 Trends in Real Estate Conference event Jan. 15 at the San Jose Country Club.
“I think it’s laughable to think about the start of COVID and how many of us in the business thought the industry was going to plummet, similar to what happened during the recession.”
But the opposite was true, she said.
“There were so many fundamentals leading up to that” which were right for the business “to be where we’re at today.”
“Retailers and restaurants have figured it out.”
Smith was joined on the “Retail in Motion: Insights & Trends” panel by Colliers Senior Director Matthew Clark and Of Place Vice President Jake Myatt.
SouthState Bank Vice President of Commercial Banking Brian Crooke moderated the panel.
ULI North Florida, the area affiliate of the Urban Land Institute, hosted the event, which was attended by about 290 people. Live Oak Contracting and Regency Centers Corp. were the presenting sponsors.
Myatt, who is working with Gateway Jax on the Pearl Square mixed-use project Downtown, is based in Washington, D.C.
“Not a lot of other cities are breaking ground on new projects,” he said. Gateway Jax broke ground in October on Pearl Square, designed to include 1,250 residential units, about 200,000 square feet of retail space, a curbless festival street with outdoor dining, and new public spaces in the NorthCore area of Downtown.
Clark, who is working to attract retail tenants to Pearl Square, said that national and retail companies are aware of Jacksonville, specifically St. Johns Town Center, Riverside-Avondale and now, Pearl Square.
“Out-of-market brokers and retailers are educated about Jacksonville,” Clark said.
Myatt and Clark said the retail space planned in Pearl Square provides an opportunity for tenants who can provide streetfront walkability and local flavors.
Expected initial tenants include a fitness center and a grocery store, although Clark would not confirm the identity of the supermarket despite an audience question asking about Florida-based Publix Super Markets Inc.
“We are very close on a grocer,” Clark said.
Myatt said it was important to allocate space in the initial design to create a retail district.
Clark referred to the “really cool shopping enclaves” in other metro areas that support local retailers and restaurants.
“It’s that local fabric of small shop space” that is “authentic to Jacksonville,” he said of elements of success.
Panelists also said that landlords are paying more for build-out costs to attract sought-after tenants.
Landing those brands, at a higher cost, can pay off by bringing in other retailers that want to be a part of the buzz.
If you want a higher quality tenant, anticipate a higher tenant-improvement package, Smith said.
Smith said another evolution is that landlords and tenants can use intensive data to track consumer patterns.
The panelists also agreed Jacksonville is entering a new phase of attracting tenants in that national retailers are seeking out the area, which is borne out by the luxury brands that are establishing their first, if not their only, presence in Jacksonville, particularly St. Johns Town Center.
Downtown is where Whole Foods Market, with two stores in the area, has chosen its next location, in Brooklyn. And Jacksonville Jaguars owner Shad Khan is building the first area Four Seasons Hotel and Residences in the Sports and Entertainment District.
“The day of doom and gloom ... is over,” Clark said.