Jacksonville industrial is in a supply-digestion phase, not a demand contraction. Vacancy has risen due to 2025 deliveries, while rents and leasing activity remain intact. Q1 recorded 74 lease deals, $10.11/SF asking rent, and 10.2% vacancy (+430 bps YoY).

 

Leasing averages are skewed by the 1.21M SF ALDI / Winn-Dixie remain-in-place re-papering. Adjusted activity shows healthy mid-box demand and continued large-block backfill. With a shrinking construction pipeline, 2026 is positioned for gradual stabilization.

 

Key Highlights

• Vacancy increase is supply-driven, not demand-driven
• Leasing remains active in mid-box and infill segments
• Pipeline is contracting, supporting stabilization
• Institutional pricing remains intact for quality assets
• Portfolio trades are distorting smaller-deal $/SF metrics

Jacksonville Demographics

Source: CoStar Group, Inc.

• Unemployment Rate: 3.9%
• Current Population: 1,793,634
• Households: 724,696
• Median Household Income: $85,087

 

Jacksonville’s economy continues to support industrial demand through steady job growth, population gains, and a diversified base anchored by logistics and trade. Port activity remains an important driver of warehouse demand, while in-migration and business expansion continue to support space needs. Although growth is moderating from recent highs, the market’s long-term economic outlook remains positive.

 

Top Jacksonville Demand Drivers

Source: CoStar Group, Inc.

• Logistics
• E-commerce
• Distribution
• Manufacturing

 

Population, Labor Force, & Income Growth

Source: CoStar Group, Inc.

Leasing

Leasing activity in Jacksonville remained active in Q1 2026, with 74 deals completed and an average lease size of roughly 18,900 square feet. Even so, vacancies continued to rise as recent deliveries and a few larger move-outs kept supply ahead of demand. Leasing strength is concentrated in the 50K–200K SF range, with continued absorption of legacy bulk space. Tenant interest, particularly for larger logistics space, remains, but leasing momentum has become more measured as occupiers take a more selective approach.

Construction

Jacksonville’s industrial pipeline is moderating after several years of outsized expansion. Roughly 0.9 million to 2.4 million square feet remains under construction, while 2025 deliveries are expected to total about 5.0 million to 6.25 million square feet.

 

Most recent development has been concentrated in large-format logistics products near key transportation corridors and port-oriented submarkets. That new supply has added competitive pressure, especially where recently completed buildings remain available. While near-term deliveries will continue to weigh on vacancy, the slower pipeline should help the market move toward better balance over time.

 

Sales

Industrial sales activity remained active in Q1 2026, with quarterly volume totaling about $289 million. Investor demand is still supported by Jacksonville’s long-term logistics appeal, though buyers are increasingly selective given softer leasing conditions and higher vacancy.

 

Pricing has held up relatively well, especially for newer, well-located assets, while broader capital market conditions continue to keep underwriting disciplined. Overall, sales momentum remains intact, but transaction activity is likely to stay more measured until market fundamentals stabilize further.

Sales Volume

Source: CoStar Group, Inc.

Market Overview

Jacksonville has shifted from a constrained market to a more selectively competitive one, with vacancy increasing primarily due to new supply rather than weakening demand. Leasing remains active in the mid-box and infill segments, while the shrinking pipeline should help stabilize the market as it works through recently delivered space. Investment fundamentals also remain constructive, with institutional pricing holding for high-quality assets, even as portfolio trades continue to skew toward smaller-deal price-per-square-foot metrics. Overall, the balance of 2026 will hinge on absorption of new supply and continued development discipline.

By the Numbers

Q1 2026 | Source: CoStar Group, Inc.

• Sales Volume: $289M
• Asking Rent Per SF: $10.11
• Vacancy Rate: 10.2%
• Vacancy Change YoY: +430 bps
• Lease Deals: 74
• Avg Lease Size (adjusted): ~18,900 SF
• Under Construction: ~0.9M-2.4M SF
• 2025 Deliveries: ~5M-6.25M SF
• 2026 Deliveries: Lower YoY