Austin Market Update: Office Sales Top 2019

Volume has nearly doubled compared to the same period two years ago, CommercialEdge data shows.

As of September, more than 313,800 square feet of office space changed hands in Austin, according to CommercialEdge data. Year-to-date through the same month, the market has seen an estimated of $1.4 billion in transactions, almost double the $787 million registered in the same period in 2019.

In the first three quarters of the year, the national office transaction volume reached $53.3 billion, on the right track to outperform last year’s deals, but falling short of pre-health crisis levels. The U.S. average price per square foot hit $295 between January and September. The Texas Capital’s average sale price during the same interval clocked in at $496 per square foot, above 2019 levels—when it reached merely $317 million. In 2020, the average price per square foot rose to $356.

The largest office transaction and the single Class A deal that closed that month was the sale of Capital Ridge, a 216,000-square-foot building in Southwest Austin. Apple paid $140 million to GLL Real Estate Partners for the seven-story asset at 320 S. Capital of Texas Highway. The property last traded in 2017, when Germany-based GLL picked it up for $96 million, records show. Capital Ridge sold at a price of $648 per square foot, well above the metro’s average.

Also in September, KKR agreed to sell Riata Corporate Park to an affiliate of Starwood Capital Group, for more than $300 million. The deal is expected to close in the coming months. The asset includes eight buildings comprising a total of 688,100 square feet, along with a 56-acre development site that can accommodate a 64,000-square-foot office building.

CommercialEdge covers 8M+ property records in the United States. View the latest CommercialEdge national monthly office report here.

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