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Office Market Insight

Austin Q1 Market Stats

$47.46
Avg. Gross Rent
12.3%
Vacancy Rate
636K
SF Delivered
7.3M
SF Under Construction

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Reimagining IH-35

I-35 Is one of the most important highways in America. It stretches across 7 states and cuts our nation in half. This 50-year-old highway needs an upgrade. The Austin Stretch of Highway is in the top ten most congested highways in the nation. It is the second most congested highway in Texas. Austin, Texas is simply outgrowing its roads.

We asked Chris Bishop (a Public Information Officer With TXDOT) how the city plans to upgrade this section of I-35 between 15th Street and Cesar Chavez. He shared with us that TXDOT has been working on plans since 2011 to expand and “alter” the Capital section of I-35. This is intended to alleviate the congestion Austinites feel every rush hour. TXDOT’s plan is to expand the Capital stretch of the highway to a total of 20 lanes. This could displace 32 acres of land and could affect 140 businesses along I-35. Chris shared with us that TXDOT’s intention is to have little to no eminent domain, and he also shared that a plan they are currently working on could have zero eminent domain.

Currently, we are in a public deliberation phase, as TXDOT listens to community input on the proposed plans to widen and “deepen” I-35 from 15th Street to Cesar Chavez. Two Groups have emerged with plans to upgrade this section of highway. Rethink35 and Reconnect Austin. Each has submitted plans in contrast to the TXDOT Plan.

ReThink 35 is a grassroots movement aimed at turning the stretch of highway that goes through the capital into a boulevard. Their intention is to re-direct traffic around the city to Hwy 183 and SH-130. This boulevard would encourage people to travel at different times of day and would force a more even distribution of traffic. They claim it has worked in every other city that has ever done it.

Reconnect Austin is another Grassroots Campaign that is catching the attention of TXDOT. Their plan Is to “cut and cap” the highway from 15th Street to Cesar Chavez. This plan would have zero eminent domain and would move all highway traffic underground and cap this highway with a boulevard and parks. The “cut” would allow the city to capture car pollution and re-direct it out of the city. They claim that their plan increases regional mobility by adding lanes, reduces congestion by relocating local traffic, and adds 60% more east-west connections. The cap section would allow for more development and higher diversity in the Austin CBD. More development leads to more tax revenue for the city. Therefore, this option is gathering more attention over the last few months. Other cities such as Dallas and Boston have capped their highway and it led to a 79% increase in commercial property values, as well as increased tax revenue. 

TXDOT is currently under technical studies to determine the best plan for the city. They are expected to finish deliberation by September of this year and are hoping to start construction in the summer of 2023.

Austin Sublease Activity

Quarter Class A Office Class B Office Class C Office Total
2016 Q2

864533

480796 60113 1405442
2016 Q3 899632 467834 38118 1405584
2016 Q4 856643 439641 34746 1331030
2017 Q1 909176 561556 25547 1496279
2017 Q2 952435 456450 28108 1436993
2017 Q3 850486 444043 45576 1340105
2017 Q4 1005713 480616 24850 1511179
2018 Q1 1114427 465834 22831 1603092
2018 Q2 1135173 703671 27356 1866200
2018 Q3 1158644 596011 62841 1817496
2018 Q4 1025760 685090 51813 1762663
2019 Q1 959386 616030 32816 1608232
2019 Q2 907874 659263 19732 1586869
2019 Q3 641646 632070 27772 1301488
2019 Q4 943674 657355 20145 1621174
2020 Q1 1293038 699123 20254 2012415
2020 Q2 1912374 808228 35809 2756411
2020 Q3 2295295 946767 44659 3286721
2020 Q4 3024439 1070789 48013 4143241
2021 Q1 2905258 1016242 59778 3985265
2021 Q2 2067050 823289 51786 2942421
2021 Q3 1760065 731252 38713 2530284
2021 Q4 1889479 845798 45870 2781147
2022 Q1 1468352 909732 51755 2429840

Austin In the News

Austin Moves Up a Spot to No. 2 on Prestigious Best Performing Cities List March 2022 ABJ Texas Led Nation in Capital Investment for Past Decade - With Big Tech Investments Stealing Show in '21 March 2022 ABJ Austin Named the No. 1 Housing Market for Growth and Stability March 2022 Culture Map "Lots of Jobs Need to be Filled" in Austin as Local Economy Booms March 2022 Statesman

 

Austin Q1 2022 Development Pipeline

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Austin Submarket Map

 

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