Even with new retail space inventory being built Austin retail space is at a premium. With occupancy rates at 96% and prime retail storefronts quoting base rents of $40 sf or more per year businesses don't have many choices to choose from. At 96% this puts Austin retail space occupancy rates the highest in Texas and one of the highest in the U.S.
Overall all many of the retail sites are quoting a base rent of $30 to $35 sf. On top of that Tenants must pay NNN (triple nets) which include the taxes, insurance, and maintenance. These average $9-$12 sf in most cases! So if you are a retailer creating a budget for retail space in Austin expect to pay a gross rate of $40 to $45 sf.
Below are a few of Austin's top retail development projects:
- Star Ranch Center in Hutto – This will be HEB anchored – 121,000 sf HEB
- Crystal Falls Town Center in Leander – Randall's anchored – 94,000 sf
- Aldrich Street Project at Mueller
- Domain Northside Rock Rose project – 100,000 sf
In 2017 expect to see a few more retail developments
- The Parke – 370,000 sf retail center in Cedar Park
- Belterra Village – 200,000 sf mixed us center in Dripping Springs that will have 85,000 sf of retail space
I don't expect to see retail lease rates in Austin to go down anytime soon. If you need help negotiating your retail space lease in Austin let us know.
Read more about this here: Austin area retail occupancy at 96%, highest rate