United States -  Jacksonville

Overview:

The market is diversified among the healthcare, distribution, military, shipping, financial, and insurance industries and sectors. Naval Air Station Jacksonville (NAS Jax) is the largest employer for the market; in the first quarter of 2015, the $16-million MQ-4C Triton Mission Control Center was completed. The healthcare sector is another important aspect of this market. In early 2015, UF Health North (an outpatient medical complex) opened along Max Leggett Parkway as part of the first phase of a larger development, which is also planned to include a 92-bed inpatient facility; the development is scheduled for completion in 2017. In addition, the Jacksonville Port Authority (JAXPORT) provides the foundation for numerous companies that collectively employ a workforce of over 65,000, generating an annual economic impact of $19 billion for the region. JAXPORT operates three public marina terminals and offers cargo terminals for the intermodal transport of containers, automobiles, bulk, break-bulk, and refrigerated cargoes, as well as a temporary cruise terminal. Furthermore, a concerted effort is being made to broaden the appeal of Jacksonville as a young, vibrant city. Several organizations, including the Downtown Investment Authority, are diligently working to broaden the appeal of Jacksonville as an international business destination. The changes to the downtown area should benefit all areas of Jacksonville, aiding in the continued growth of the city as a whole.

Since 2009, the entrance of new hotel supply in the Jacksonville market has been rather minimal, allowing occupancy and average rates to increase in the area. In 2015, the new supply was quickly absorbed and occupancy continued to experience modest gains. However, we anticipate new supply to outpace demand growth going forward. With the anticipated entrance of new supply and significant renovations to several properties in the area, we expect continued rate growth, allowing for a positive RevPAR going forward.

Nearly 30 hotels totaling over $240 million in transaction volume have sold since January 2013, including such significant assets as the Hyatt Regency Jacksonville Riverfront (highest total price paid at $53,000,000 or $55,000 per key) and the Hampton Inn Jacksonville Beach Oceanfront (highest price per key at $149,718, for a total of $26,500,000). However, early indications for 2016 illustrate a deceleration of growth in transaction volume, and values are expected to stabilize in the near term.

* The HVI is an index, a statistical concept reflecting a measure of the difference in the magnitude of a group of related variables compared with a base period. As such, it is a measure of broad market trends, rather than a conclusion as to the specific value of any asset, and cannot be applied to an individual asset. A good comparison is the Consumer Price Index. While this index provides a reliable measure of the overall rate of inflation in a region, it does not indicate how the price of milk has changed at your grocery store. So how can the HVI be of use to an individual investor? Although the HVI cannot tell you what a particular hotel is worth, it does provide excellent big picture data, indicating which market areas are experiencing positive trends, and thus may present good investment opportunities. The HVI for the U.S. is a measure of the strength of the lodging industry as a whole and, specifically, the hospitality investment market. The HVI for the various identified markets can provide a basis to evaluate and compare different geographic regions. For more insight on the limitations and applicability of the HVI, please read the message on the HVI home page by clicking on the graphic at the top of this page.

Valuation Trends and Predictions:

Jacksonville United States
Previous Year +1% (39 of 71) +1% (49 of 71)
Growth in 2017 +2% (25 of 71) +2% (36 of 71)
Growth in next 3 years +11% (31 of 71) +10% (36 of 71)

Change In Value For Market:

Jacksonville RevPar % Change

For more information, please contact:

Kathy Conroy, MAI
kconroy@hvs.com
  • +1 305 378-0404 (w)
John Lancet, MAI
jlancet@hvs.com
  • +1 305 378-0404 (w)
  • +1 305 502-1167 (m)
Heidi Nielsen
hnielsen@hvs.com
  • +1 843 847-1986 (w)