"Small, locally based businesses were conservative in their expansion strategies and are expected to weather the current challenges facing the economy," Bradley says. He adds that the area's strong Navy presence and prospects for increased trade through JaxPort help the outlook for retail leasing and investment.

A decline in construction will help offset softer demand for space, though vacancy will creep higher in the Baymeadows and Mandarin submarkets, where 70% of new inventory is opening this year, according to Bradley. Investment opportunities persist, particularly on the southern end near Interstate 95 and St. Augustine Road, he says.

"Approximately 1,900 multifamily units are scheduled to be completed in the area over the next two years, and office demand is picking up, generating demand for retail," he says. Cap rates for single-tenant properties are trading in the mid-7% range, while multitenant assets are trading at close to a 9% cap and initial yields for both are expected to continue to trend upward throughout 2009, Marcus & Millichap states.

Montour, a member of Colliers International's retail steering committee, points out that Jacksonville has been successful in avoiding upscale shopping developments like those in Orlando or South Florida that are geared more toward tourists than residents, sticking more to staple goods instead. At the same time, he says, those in affluent areas such as St. Johns Town Center are able to command rents as high as $30 per square foot.

For tenants not seeking rent breaks from landlords or on the verge of closing, there are good deals to be had in the ongoing recession, Montour says: "You can do a lot more now that you couldn't in good times."