First Coast

Jacksonville Fuels Luxury Apartments Market Growth

WJCT News | By Bill Bortzfield

Published September 25, 2018 at 1:08 PM EDT

This rendering shows what the SoBa luxury apartments at 1444 Home St. will look like when finished. Catalyst Development is building the project.

Here are some numbers that help explain all the apartment construction going on around town.

Jacksonville ranked 12^th in the nation when it comes to high-end apartment construction, or so-called luxury apartments.

That’s according to RENTCafe, which looked at the numbers and found luxury apartments are a big nationwide trend. Nationally, 79 percent of new rental apartments built in 2017 were top-of-the-market.

RENTCafe said developers, encouraged by a surge in demand for rentals, have bet big on high-end apartments.

Projections for the first half of 2018 show that new apartment construction in Jacksonville is 100% luxury, according to RENTCafe’s study.

So far this year, Jacksonville ranks 10^th nationally, when looking at the percentage of luxury rentals stock. Thirty-One percent of Jacksonville's overall rental market is considered high-end, which is above the national average of 23 percent.

The median monthly rent in Jacksonville is $1,375, according to HotPads, which is a division of Zillow.

The trend toward luxury apartments is one that worries Ability Housing CEO Shannon Nazworth.

“The problem is, there’s a huge demand at the lower-income ranges and the market just can’t, or won’t, serve those households. And every year it becomes a bigger and bigger issue — the gap becomes bigger and bigger,” said Nazworth.

Nazworth said the business community, the faith community, local government and nonprofits have to come together to address the affordability issue. She said people making minimum wage would have to work at least two full time jobs to afford the average rent on a two bedroom apartment.

Back to high-end apartments, RENTCafe looked at construction data tracked by Yardi Matrix, which covered more than 80,000 large-scale apartment developments with at least 50 units across more than 130 markets in the United States.

RENTCafe said the definition it used for high-end or luxury rental developments included those buildings classified by Yardi Matrix as Class B+ and above.

WJCT's Cyd Hoskinson contributed to this story.

Bill Bortzfield can be reached at bbortzfield@wjct.org, 904-358-6349 or on Twitter at @BortzInJax.