What Does the Widening of Panama Canal Have to do with Investing in Jacksonville Property?

What does the widening of the Panama Canal have to do with investing in Jacksonville property? According to USA real estate expert Greg Rand, founder and CEO of OwnAmerica – everything! Rand has covered this extensively in his OwnAmerica blog, his radio show and on Fox Business News.

Officially starting in 2007, the project is projected to double the capacity of the Panama Canal by 2014; and generate enough wealth to transform Panama into a First World country. Jacksonville, Florida, is one of the three main ports to benefit from the development and, in this article, you will discover what one of the greatest engineering feats of the last 100 years has to do with generating high yields for Axis clients!

Investors are “swooning”

In brief, this localised shift in trade and commerce means a surge in both job and population growth, resulting in a higher demand for housing. Jacksonville (Florida’s ‘finance capital’) is already an incredibly-popular place to live and ranks amongst the ‘Top 10 Best Places to Live’ (Money Magazine) and one of ‘America’s Hottest Cities’ (Expansion Management Magazine).

With a population currently standing at a little over 1,372,000 and a 48% migration boom from 1990 to 2010, Jacksonville should now see its population double again in the next 10 years as this trend takes hold.

This makes now, more so than ever, the optimum time to invest in Jacksonville investment property. In fact, Rand reports investors to be “swooning” over this new boost to Jacksonville’s already-high appeal.

Join the ‘A Class’ with trophy Jacksonville property from Axis

Axis recently identified Jacksonville as a high-end, Florida investment hot spot and negotiated an exceptional deal on ‘Class A’ investment property in the exclusive The Gardens of Bridgehampton community. ‘Class A’ property is luxurious ‘trophy’ property, with high-end finishes, in prominent locations and typically demanding higher-than-average rents. The Gardens of Bridgehampton is one of the most exclusive, residential communities in the whole of Florida and one of the only condo complexes in the surrounding area.

Axis clients can invest from just $72,000 (circa £45,000), which is a circa 30% discount from today’s build cost and a circa 50% discount from the previous sales prices. Add in yields up to 18% and you can clearly see why investors are “swooning” over Jacksonville!

The route to an excellent investment

So, what does the widening of the Panama Canal have to do with investing in Jacksonville property? In order to understand this unique situation, let’s first look at the history of the Panama Canal.

The construction of the Panama Canal was completed in 1914 and became the key shipping conduit to connect the Atlantic and Pacific Oceans. A ship can cut 13,000 miles from its journey by travelling through the Panama Canal, instead of going the long way around via the southern tip of South America at Cape Horn.

Throughout the last century, container ships were built to specifications which would (barely!) fit through the canal. Now, the standard-sized ‘Panamax’ ship has been dwarfed by the ‘post-Panamax’ ships which can carry five times the weight – a major advancement in the efficient transportation of goods from the Far East!

The only problem is that they cannot fit through the canal! So, the ships have to either go all the way around South America, traverse the dangerous waters of the Strait of Magellan; or drop off their cargo on the west coast of the USA (such as Long Beach, California) and transfer cargo to trucks and trains to get it to the east coast.

This is all about to change!

Now, a century after ‘The Big Ditch’ was navigated by its first cargo ship, the Panama Canal is to be widened to accommodate the post-Panamax megaships. No longer will the choice be to go all the way around the southern tip, or drop the cargo off in California, thus losing time and efficiency. Starting very soon, millions of tons of cargo will make its way through the canal and up I-95 to the greatest concentration of wealth and population in the States – the north-east.

All boats rise with the tide

Where will the cargo hit landfall? Jacksonville, Florida, Savannah, Georgia and Charleston, South Carolina. Why? These are the first three deep-water ports on the canal.

Rand explains: “All three cities enjoy a fantastic quality of life, a low cost of living and a lifestyle which make them incredibly attractive residential locations. With the canal-associated high-paying jobs to add to the locations’ appeal, investors in these areas are swooning.”

In his radio interview with Ed Forman, president of Realty Corp in Jacksonville, Rand goes into depth about the appeal and the flurry of investor activity which is taking place.

He comments: “Remember, investing in real estate starts with picking the market. The old adage “all boats rise with the tide” is especially apropos here. Watch where the boats go and place your bets.”

Next steps for success

1. Download our Jacksonville ‘Class A’ Property Investment Guide.
2. Contact our dedicated USA portfolio manager, Russell Bonner, at russell@axiscontact.com or +44(0)1273 447 301 (direct line) or +44(0)1273 447 300 (main office switchboard).
3. Tune into a video recording of Greg Rand’s full interview with Ed Forman. 
4. Watch Rand on Fox Business News.

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