Austin Office Space Market Still Strong Q1 2017 Despite Uptick in Vacancy

austin office space market q1 2017Even though office space occupancy rates in Austin have softened a little office rental rates continue to increase. For class A office space in Austin the occupancy rates overall are around 90% and rental rates are averaging $37.50 to $38 sf. In downtown Austin rental rates range from $45 to $55 sf gross.

Despite the slowed job growth the Austin office market continues to be one of the strongest in the country. The slight increase in vacancy rates can be attributed to a combination of slowed job growth and due to the additional 1 million sf of austin office space that was delivered in the first quarter of 2017. Additionally Austin has another 1.7 million sf of office buildings under construction.

Key Takeaways:

  • Demand for office space in Austin still high despite slower job growth and the delivery of new office buildings
  • Austin office space demand expected to remain high for 2017
  • Austin still looked at by many out of state companies as a target area for growth
  • Software, social media companies, and financial tech companies seem to be driving demand in Central Texas
  • Tax increases are the primary reason why we are seeing huge increases in rental rates in Austin, especially in downtown Austin.
  • Office sublease space is up to around 1.3 million sf primarily in Downtown, Northwest, and Southwest Austin

Read More Here: http://www.mystatesman.com/business/austin-office-market-still-strong-despite-uptick-vacancy/JUUbTVqGEzqnUN1pf6I9XP/

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