Bill and Margit Raynor changed their minds about renting
a Ponte Vedra Beach apartment after they toured a unit at The Reserve at Point
Meadows, a Southside apartment complex.
"When we saw the nice big windows and all the light that was coming into the
apartment, we knew instantly this was where we wanted to live," said Bill
Raynor, who is retired from the military. "It also smelled good. The Ponte Vedra
apartment had a musty old smell in it, and it had little windows and it was dark
on the inside."
The Raynors have chosen to live in an apartment because it offers a
maintenance-free lifestyle. Also, the couple, who now live at the apartment in
Jacksonville after living in Europe, have not decided where they will make their
permanent residence. So, by choice they will live in the Soutside apartment.
The demand for an apartment by older people, young couples, singles, people
needing a temporary place to stay and so-called "lifestyle" renters, like the
Raynors, is causing a flurry of apartment complexes to be built in the
Jacksonville area.
The construction of apartments is happening in most parts of the area.
Experts say the steady job growth is spawning the construction of apartments,
both luxury and affordable. Developers realize that building a complex swankier
than the one down the street or on the other side of town will draw tenants.
Amenities, including business centers, are about as standard and necessary as
swimming pools at many complexes.
A nationwide trend indicates that more people are renting in apartment
complexes, despite the droves of new home buyers.
For instance, there were more people who rented in apartment complexes as
opposed to renting a single-family house, duplex or any other small
multiple-rental property. The number of renters at duplexes and other small
multiple rental properties has decreased.
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The entrance
to Logan's Pointe, an affordable multi-family apartment complex located off St.
Johns Bluff Road. -- Will
Dickey/Staff--------------------------------------------------
Case in point, the number of people in the United States who choose to rent
in apartment complexes increased from about 15 million in 1997 to 15.5 million
in 2000, a 3 percent increase, according to statistics from the National Multi
Housing Council in Washington.
The uptick is mainly attributed to the amenities that are provided at an
apartment complex compared with the lack of amenities that are provided at other
rental properties.
"Despite the record level of homeownership, more people are renting
apartments because they like the "hassle-free" living, with no mowing the lawn
... ," said Mark Obrinsky, chief economist at the National Multi Housing
Council.
And so the demand for the amenity-rich apartment complexes is fueled.
The apartment demand
New jobs create a demand for new apartments.
"Apartment development is attributed to the extremely strong job growth in
Jacksonville," said Cash McVay, a multi-family land specialist at Walchle
Investment Group in Jacksonville Beach.
Most new residents who move to the area as the result of a job relocation
need a temporary place to stay. Usually the stay takes place at an apartment
complex until they learn the area and find a house.
There is a related formula that dictates how many apartments should be built.
"For every 5.7 jobs that are created, one apartment should be built," said
McVay, who called that number the industry's so-called equilibrium point.
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The Berkman
Plaza is under construction on Bay Street next to the Duval County Courthouse.
-- Bruce Lipsky/Staff --------------------------------------------------
Last year, about 23,400 new jobs were created in a four-county area comprised
of Duval, Clay, St. Johns and Nassau counties.
Given that number of new jobs, the market could withstand the construction of
about 4,100 apartments. Instead, 2,600 new apartments were built last year,
which was about 1,500 below what the market could occupy.
"If the Chamber's expectation of 18,000 new jobs to be created in 2001
materializes that would result in an equilibrium of 3,150 new units in this
amount, which is 450 units more than the 2,700 new units we predict in 2001,"
McVay said. "This will create another year of equilibrium imbalance because we
are under-building for the amount of jobs we are creating. And that's why we
have seen more construction."
The high occupancy rate, which has hovered around 93 percent for the past
five years, indicates there is room for more apartment development.
"The exciting trend to watch is the upward movement in occupancy rate in an
environment of increasing construction," McVay said.
Most of the apartments, 60 percent, are being built on the Southside, with
the remainder of the construction taking place on the Westside, downtown and in
the Arlington area.
In the downtown area, where there has been no new apartment construction in
decades, many are being built and others are in the planning stages.
Lincoln Property Group of Atlanta, developer of the 257-unit Villas of St.
Johns located along Riverside Avenue, recently started leasing apartments.
Officials of the Harbor Companies of Atlanta are developing the 22-story,
206-unit Berkman Plaza, located downtown along the Northbank. It is expected tonext year.
And negotiations continue between officials of The Vestcor Companies of
Jacksonville and the Ireland owner of two vacant historic downtown buildings.
Vestcor wants to buy the two buildings, the old Lynch and Roosevelt Hotel
buildings, for about $5 million and redevelop them into 226 loft-style
apartments.
"Future construction will decelerate to lower levels due to a lack of zoned
concurrent sites," McVay said. "And more importantly, there is a limited supply
of land within the land-use categories that allows for multi-family development.
We are running extremely low on sites."
What's in a name?
The names of the development companies that are building apartment complexes
are familiar and others are not.
The developers include real estate investment trust companies, or REITs,
merchant builders and private investment building companies.
Of the nine apartment complexes plans that have recently been filed with the
Jacksonville Planning and Development Department, four are being proposed by
Vestcor.
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Dana (left)
and Rebecca Flournay play basketball at the indoor court at The Reserve at
Pointe Meadows, an upscale complex off Gate Parkway where they have been living
for about two months. -- Will
Dickey/Staff--------------------------------------------------
In addition, the company recently announced it will start construction on
Tivoli at Deerwood, a 400-unit apartment complex to be located in Southside,
near Tinseltown.
In that attempt to attract tenants, 188 units of the Mediterranean-styled
complex will have direct-access garages. Construction is set to begin next
month.
Out-of-town developers have an eye on the market because there is a need for
new affordable apartment complexes with amenities.
A&S Development Inc. of Winter Park is working to close a deal to build a
90-unit affordable apartment complex on Avent Drive on the Westside.
The company is attempting to secure tax credits from the federal government
to build the complex, which is how many of the affordable apartment complexes
are funded. Tax-exempt bonds are also used.
The cost to build an affordable complex is offset and allows the developer's
cost to be lower, thus allowing for lower rents.
Affordable rents can start at about $450 for a one-bedroom apartment compared
with as much as $850 for a one-bedroom luxury apartment.
Andrew Russo, project developer of A&S Development, said Avent Garden
Apartments will be a five-building complex, which will consist of a community
building, playground, basketball court, pool and picnic pavilion.
"It will cater to military personnel, hospitality workers, retail sales
workers and other entry-level workers who want a nice place to live," Russo
said.
Of the 16 new apartment complexes that are being built or have been built,
four are affordable complexes with a total of 976 units.
But the term "affordable" does not mean the apartments are below the standard
of other apartments.
While they do not have as many amenities as do many luxury apartments, there
are some of the same amenities that Russo's project plans.
"This market typically sees about two to three affordable projects a year,
which is slightly under what the market can handle," McVay said. "The term
affordable is relative. Affordable housing has a bad ring to it. We are getting
to the point that you can not determine the difference between the conventional
multi-family development and the affordable development."
The lure of amenities
The 7,800-square-foot clubhouse lobby at The Reserve at Point Meadows
resembles the lobby of an upscale hotel resort.
There is a large-screen television in the sitting area that has cathedral
ceilings; ceramic tile floors; a social room that features two TVs, a kitchen
and a wood-grain bar minus rows of liquor bottles; a business center with
computers that have Internet access; a small conference room; a fitness center;
an indoor basketball court, and a swimming pool area with a cabana that consists
of a large barbecue grill.
Most of these features can be found at other apartment complexes in the area.
But there are tweaks here and there that make each different.
With the construction of each new apartment complex there is an effort to
raise the standard for the kind of amenities.
For instance, at The Reserves at James Island, located near the The Reserve
at Point Meadows, there will be a massage room where residents can get one free
massage a month when the complex is scheduled tolater this month.
The Heritage at Deerwood, which is located next door to the James Island
project, has an ATM located outside the clubhouse. The attached garages make
that apartment complex appear more like a single-family home or townhouse
community.
St. John Estates, a 240-unit complex located on South Kernan Boulevard,
offers a bundle of technology services, which consists of local and long
distance telephone services, Internet services and satellite television, as well
as, other technology services. The eight-building complex, whichd this
past January, is a self-proclaimed "smart" community because of it technology
offerings. Residents pay a basic fee for the services that are managed on-site
by DiscoverTec, a technology services company in Jacksonville.
It is among the few apartment complexes in the area that provides such
technology services.
However, the residents of Melrose Apartments of Jacksonville, which is
located next door to St. Johns Estates, are provided with similar services.
The sheer size of some apartments is an amenity.
The average size of an apartment built in 1999 was 1,105 square feet, up from
922 square feet in 1985 and the highest reading since the Census Bureau began
collecting this information in the 1970s.
Thefeel of the 1,287-square-foot apartment at The Reserve at Point
Meadows was an attraction for the Raynors, as well as having a place to
exercise.
"The fitness center is important to us because we are fitness buffs," said
Bill Raynor, referring to he and his wife, Margit's interest in exercising. "I
would not mind staying here if I was going to live here."
