8 Challenges Facing Growing Demand For Austin Office Space

8 Challenges Facing Growing Demand For Austin Office SpaceAs more existing Austin companies continue to expand and as more people and other companies open up Austin offices the demand for office space in Austin continues to increase.  As the demand for Austin office space continues there are some challenges that we will face.

1.  Air Quality and Density – Office space is getting more and more dense as companies try to squeeze in as many people as they can.  More people and more computer equipment squeezed into spaces will make it hard to keep fresh air circulating.

2.  Parking – Parking is tight in downtown Austin and you can only build so many parking garages.  With the rise of Uber and other shared transportation services available parking in downtown Austin is a bit easier than in the suburbs.  In suburban areas of Austin parking is limited as you have to deal with very strict impervious cover ratios and land costs are high.

3.  Not Many Office Space Options for Startups or Small Businesses – Startups and small business is growth mode have a hard time finding Austin office space options because rental rates are very high and landlords will not do anything less than a 3-5 year lease term.  These types of companies need the flexibility to do shorter lease terms.

4.  Finding Space Near Transportation – Finding good space close to transportation and parking areas is difficult.  Business decision makers are having a hard time finding office space in Austin that has convenient transit and other amenities.

5.  Creative Office Space Designs – Companies want creative office space designs however they don’t know how to define what they need or want.  It’s important that they design office space in a way that makes employees happy and productive however that also makes the company money.  Business decision makers need to understand how to design space that addresses the functional needs of how employees work (e.g. sales team vs developers).

6.  Cost of Creative Office Designs are High – Companies want space that promotes flexibility, productivity and collaboration however they also want it to be multifunctional…..meaning no wasted space.  Open office spaces are typically cheaper however when you start exposing the ceiling and adding lots of glass walls costs go up.  Furniture costs also tend to go up with open layouts since it too becomes multifunctional.

7.  Energy Costs Increasing – Since more and more people use technology the need for cooling has increased.  Office buildings that were built 25 years ago are not as efficient as new offices today so they use up more electric power.  Today MEP costs average about 50% of construction costs as opposed to 25% 20 years ago.

8.  Office Space that Can Accommodate Growth Needs – Growing companies need space that they can grow into.  Some may only need 5,000 sf today however may need 25,000 sf 14 months from now.  They need flexible lease contracts and office buildings that can accommodate that.  Landlords however are expecting companies no matter the situation to sign 5 year leases.


Scroll to Top