{"id":1004770453,"date":"2025-09-26T03:18:08","date_gmt":"2025-09-26T11:18:08","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004770453"},"modified":"2025-09-26T06:38:13","modified_gmt":"2025-09-26T14:38:13","slug":"austins-office-sector-remains-resilient","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/austins-office-sector-remains-resilient\/","title":{"rendered":"Austin&#8217;s Office Sector Remains Resilient"},"content":{"rendered":"<div class=\"wp-block-image\">\n<figure class=\"alignright size-full is-resized\"><a href=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/09\/The-Republic-e1756906547740.jpg\"><img loading=\"lazy\" decoding=\"async\" width=\"426\" height=\"320\" data-attachment-id=\"1004770470\" data-permalink=\"https:\/\/www.commercialsearch.com\/news\/austins-office-sector-remains-resilient\/the-republic\/\" data-orig-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/09\/The-Republic-e1756906547740.jpg\" data-orig-size=\"426,320\" data-comments-opened=\"0\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;0&quot;}\" data-image-title=\"The_Republic_Austin\" data-image-description=\"&lt;p&gt;Image received in April 2022. . Image courtesy of Neoscape&lt;\/p&gt;\n\" data-image-caption=\"&lt;p&gt;The Republic is the largest office project currently under construction in Austin. Image courtesy of Neoscape&lt;\/p&gt;\n\" data-large-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/09\/The-Republic-e1756906547740.jpg?w=426\" src=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/09\/The-Republic-e1756906547740.jpg\" alt=\"Rendering of The Republic, an office project in Austin, Texas.\" class=\"wp-image-1004770470\" style=\"width:400px\" srcset=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/09\/The-Republic-e1756906547740.jpg 426w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/09\/The-Republic-e1756906547740.jpg?resize=300,225 300w\" sizes=\"auto, (max-width: 426px) 100vw, 426px\" \/><\/a><figcaption class=\"wp-element-caption\">The Republic is the largest office project currently under construction in Austin. <em>Image courtesy of Neoscape<\/em><\/figcaption><\/figure><\/div>\n\n\n<p>Construction activity in Austin&#8217;s office sector continued its strong progress, with the market standing out as the leader in square footage under construction, according to Yardi Research Data. <\/p>\n\n\n\n<p>Developers added large projects, while deliveries slowed down in the Texas capital. At the other end of the spectrum, Austin&#8217;s office sales volume placed it among the lowest-performing metros, while two of its peers outpaced gateway markets. <\/p>\n\n\n\n<p>The metro&#8217;s vacancy rate remained as the most elevated in the nation and is expected <a href=\"https:\/\/www.commercialsearch.com\/news\/office-vacancy-increase-persists-commercialedge\/\">to rise some more<\/a>, as the metro is adapting to stock that has been completed over the past five years.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-austin-s-office-pipeline-still-growing\">Austin&#8217;s office pipeline still growing<\/h2>\n\n\n\n<p>As of July, Austin\u2019s pipeline included nearly 4 million square feet of space under construction across 30 projects. This represented 3.6 percent of existing stock, well above the national figure of 0.9 percent and positioning Austin as the leader of its peers, with Nashville, at 1.8 percent, following.<\/p>\n\n\n\n<p>Austin\u2019s pipeline topped the charts too, the metro that followed being Dallas, with nearly 4 million square feet underway. The Bay Area ranked third, with 3.3 million square feet, followed by Houston\u2019s approximately 3 million square feet.<\/p>\n\n\n\n<iframe title=\"Office pipelines across Austin's peer markets\" aria-label=\"Table\" id=\"datawrapper-chart-1HK9a\" src=\"https:\/\/datawrapper.dwcdn.net\/1HK9a\/1\/\" scrolling=\"no\" frameborder=\"0\" style=\"width: 0; min-width: 100% !important; border: none;\" height=\"490\" data-external=\"1\"><\/iframe><script type=\"text\/javascript\">!function(){\"use strict\";window.addEventListener(\"message\",function(a){if(void 0!==a.data[\"datawrapper-height\"]){var e=document.querySelectorAll(\"iframe\");for(var t in a.data[\"datawrapper-height\"])for(var r,i=0;r=e[i];i++)if(r.contentWindow===a.source){var d=a.data[\"datawrapper-height\"][t]+\"px\";r.style.height=d}}})}();<\/script>\n\n\n\n<p>The largest office project in the metro remains The Republic, Lincoln Property Co.\u2019s 816,560-square-foot tower in downtown Austin. The company is developing the project alongside Phoenix Property Co. and DivcoWest. <a href=\"https:\/\/www.commercialsearch.com\/news\/lpc-divcowest-pull-trigger-on-austin-tower\/\">Construction started in 2022<\/a> and completion is estimated for this September.<\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"alignright size-full is-resized\"><a href=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/08\/Waterline.jpg\"><img loading=\"lazy\" decoding=\"async\" width=\"1000\" height=\"749\" data-attachment-id=\"1004767236\" data-permalink=\"https:\/\/www.commercialsearch.com\/news\/lincoln-kairoi-top-out-texas-tallest-tower\/waterline\/\" data-orig-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/08\/Waterline.jpg\" data-orig-size=\"1000,749\" data-comments-opened=\"0\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;1753378966&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;1&quot;}\" data-image-title=\"Waterline\" data-image-description=\"&lt;p&gt;Exterior shot of Waterline, an office building underway in Austin, Texas.&lt;\/p&gt;\n\" data-image-caption=\"&lt;p&gt;The 2.7 million-square-foot project will feature 26 office stories and 33 residential floors on top of a 13-story hotel, as well as two amenity floors. Image courtesy of DPR Construction  &lt;\/p&gt;\n\" data-large-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/08\/Waterline.jpg?w=1000\" src=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/08\/Waterline.jpg\" alt=\"Exterior shot of Waterline, an office building underway in Austin, Texas.\" class=\"wp-image-1004767236\" style=\"width:400px\" srcset=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/08\/Waterline.jpg 1000w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/08\/Waterline.jpg?resize=300,225 300w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/08\/Waterline.jpg?resize=768,575 768w\" sizes=\"auto, (max-width: 1000px) 100vw, 1000px\" \/><\/a><figcaption class=\"wp-element-caption\">Waterline is a 2.7 million-square-foot project that will feature 26 office stories alongside 33 residential floors and a 13-story hotel.<em> Image courtesy of DPR Construction  <\/em><\/figcaption><\/figure><\/div>\n\n\n<p>The second-largest office project in the metro is Waterline, a 703,000-square-foot high-rise. Another project of Lincoln Property Co., with co-developing partner Kairoi Residential and $742.5 million in construction funds, Waterline <a href=\"https:\/\/www.commercialsearch.com\/news\/lincoln-kairoi-top-out-texas-tallest-tower\/\">topped out<\/a> earlier this month at 74 stories and 1,025 feet, making it the tallest building in Texas.<\/p>\n\n\n\n<p>Deliveries in Austin comprised 16 properties totaling 399,578 square feet, representing only 0.4 percent of its existing stock and marking a notable 50.7 percent year-over-year decrease in <a href=\"https:\/\/www.commercialsearch.com\/news\/top-markets-for-office-deliveries\/\">office completions<\/a>. Meanwhile, only 156,124 square feet across two properties broke ground since the start of the year.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-elevated-vacancy-likely-to-escalate\">Elevated vacancy likely to escalate<\/h2>\n\n\n\n<p>As of July, Austin remained the market with the most elevated office vacancy rate, clocking in at 27.2 percent\u2014well above the 19.4 percent national rate and marking a 430-basis-point increase over the past 12 months. Despite the metro recording string office utilization and employment growth over the past few years, Austin\u2019s vacancy will likely continue to grow as the metro is impacted by a considerable amount of completed office stock.<\/p>\n\n\n\n<p>Meanwhile, the metro\u2019s listing rates averaged $45.61 per square foot, above the $32.72 per square foot national value. When compared to similar markets, Austin\u2019s rents were higher than San Diego ($45.23 per square foot) and Atlanta ($35.66 per square foot), while the Bay Area led with $51.55 per square foot.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-slow-investment-pace-prices-still-high\">Slow investment pace, prices still high<\/h2>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"alignleft size-full is-resized\"><a href=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/09\/8000-Metropolis-Drive-metcenter-e1756906731460.jpg\"><img loading=\"lazy\" decoding=\"async\" width=\"640\" height=\"480\" data-attachment-id=\"1004770472\" data-permalink=\"https:\/\/www.commercialsearch.com\/news\/austins-office-sector-remains-resilient\/8000-metropolis-drive-metcenter\/\" data-orig-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/09\/8000-Metropolis-Drive-metcenter-e1756906731460.jpg\" data-orig-size=\"640,480\" data-comments-opened=\"0\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;0&quot;}\" data-image-title=\"8000 Metropolis Drive metcenter\" data-image-description=\"&lt;p&gt;Proprietary image retrieved from Yardi Matrix&#8217;s database. &lt;\/p&gt;\n\" data-image-caption=\"&lt;p&gt;Building C and D are part of Creative Office at MetCenter, an office campus in Austin. Image courtesy of Yardi Research Data&lt;\/p&gt;\n\" data-large-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/09\/8000-Metropolis-Drive-metcenter-e1756906731460.jpg?w=640\" src=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/09\/8000-Metropolis-Drive-metcenter-e1756906731460.jpg\" alt=\"Exterior shot of the Creative Office at MetCenter,a four-building office campus in Austin, Texas.\" class=\"wp-image-1004770472\" style=\"width:400px\" srcset=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/09\/8000-Metropolis-Drive-metcenter-e1756906731460.jpg 640w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2025\/09\/8000-Metropolis-Drive-metcenter-e1756906731460.jpg?resize=300,225 300w\" sizes=\"auto, (max-width: 640px) 100vw, 640px\" \/><\/a><figcaption class=\"wp-element-caption\">Building C and D are part of Creative Office at MetCenter, an office campus in Austin.<em> Image courtesy of Yardi Research Data<\/em><\/figcaption><\/figure><\/div>\n\n\n<p>As of July, Austin recorded $343 million in <a href=\"https:\/\/www.commercialsearch.com\/news\/top-markets-for-office-transactions\/\">office transaction volume<\/a>, with properties trading at an average of $223 per square foot\u2014above the national average of $182 per square foot. The metro\u2019s sales price outperformed Atlanta ($139 per square foot), Phoenix ($197 per square foot) and Houston ($96 per square foot), while the Bay Area emerged as the priciest similar market, with properties swapping at $377 per square foot.<\/p>\n\n\n\n<p>Austin\u2019s investor activity was among the lowest ones in comparison with most of its peers. For context, the Bay Area led the rankings with $3.1 billion, followed by Dallas, with $1.2 billion, while Austin outperformed Twin Cities, with $321 million. The Inland Empire had the slowest investment activity, with only $59 million in sales at the end of July.<\/p>\n\n\n\n<p>One of the largest sales in the Texas capital was the $57.1 million portfolio sale of two assets within the Creative Office at MetCenter. Preylock Real Estate Holdings purchased Buildings C and D, encompassing 135,250 square feet, from Zydeco Development, in a deal that closed in February.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-coworking-share-on-par-with-hotspots\">Coworking share on par with hotspots<\/h2>\n\n\n\n<p>Texas\u2019 capital coworking market included approximately 1.8 million square feet of space across 92 locations as of July, representing 1.8 percent of its total office inventory. The metro\u2019s flex office footprint outperformed inventories in Tampa (1.7 million square feet), Charlotte (1.5 million square feet) and Orlando (1.4 million square feet), while its share of total leasable office space was on par with Dallas, Houston and Charlotte.<\/p>\n\n\n\n<p>As of July, the flex office provider with the largest footprint in Austin remained WeWork, with 298,149 square feet. Companies that followed include Industrious (210,446 square feet), Expansive (160,245 square feet), Regus (157,735 square feet) and Spaces (121,938 square feet).<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Texas capital keeps its development pace and sale prices, according to the latest Yardi Research Data.<\/p>\n","protected":false},"author":2991,"featured_media":1004770470,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1578,21782,21783,52420,21742,21747,51973],"tags":[51047],"class_list":["post-1004770453","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-austin","category-development","category-investment","category-market-updates","category-latest","category-office","category-southwest","tag-marketupdate"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v24.6) - 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