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Q4 2018 | Austin Office | Research & Forecast Report

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Austin's office market ends 2018 with higher rental rates and higher absorption

HOUSTON - Feb. 7, 2019 - Rezul -- Austin's office market continues to be one of the hottest and most desired in the country. Q4 recorded positive net absorption for the second quarter in a row, which balances out the negative net absorption we saw in the first two quarters of the year and brought the year to date net absorption up to 29,762 SF. With absorption ticking up in Q4, vacancy rates continue to drop, settling at 11.5% market wide by the end of Q4 and causing average rents to rise slightly along with operating expenses (due to increasing building values/taxes).

A major highlight of Q4 was the announcement of Apple's 3,000,000 SF campus in North Austin. The announcement will undoubtedly have a positive ripple effect on the Northwest Austin submarket and is evidence of the continued optimism in Austin's thriving economy. To that end, we expect to see several other notable tech giants follow suit with commitments to large blocks of space. Almost every big block of space (on the ground and under construction) is currently trading paper with large corporate users. Recent experience shows that competition for these large blocks is tremendous. Regardless of credit and size, for our client's best interest, we work multiple transactions for each need as the likelihood of getting pushed due to a bigger deal coming along is becoming a common occurrence.

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Another notable development trend is... Read more at https://www2.colliers.com/en/Research/Austin/2018-Q4-Office-Austin-Report

Kaitlin Holm | Research and Marketing Coordinator

Source: Colliers International
Filed Under: Real Estate

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