Austin, Texas leads the charge as one of the US’ fastest-growing economies, making it ripe for commercial real estate interests.
The Texas state capital has witnessed a tide of growth from workers and businesses, especially in the technology sector. As the city grows, commercial real estate investors and tenants have flocked to Austin’s promising economy and favorable investment returns. Crexi’s CRE marketplace connects interested parties to hundreds of available Austin commercial properties, providing them with the best tech tools to analyze and invest.
Austin brokers and those representing Austin listings can harness Crexi’s powerful technology suite to manage leads and deftly navigate properties from list to close. To date, Crexi has empowered brokers to transact over $300 billion in commercial assets, representing more than $1.2 trillion in property.
Crexi supports Austin, Round Rock, Georgetown, Lakeway, Buda, and the surrounding communities as the nation’s fastest-growing online CRE platform.
The State of Austin Commercial Real Estate
Austin ranks as one of NAI’s top 10 commercial real estate markets, projected to outperform the rest of the country. Favorable economic and demographic conditions, strong GDP and low unemployment, business openings, and new building permits are just a handful of key growth factors that make the Austin commercial real estate market attractive.
Austin is the capital of Texas and the fourth-most populous city in the state. Located in the Hill Country region of Central Texas, the city is surrounded by lakes and rivers, including the Colorado River. Austin is nicknamed “Silicon Hills” due to its growing employment rate, from high-tech companies such as Amazon, Apple, Oracle, and Tesla.
The city is the economic and cultural center of the metropolitan area, with a diverse mix of college students, musicians, blue-collar and high-tech workers, and government employees. Austin’s official slogan is “The Live Music Capital of the World” and is home to the longest-running music series in American TV history, Austin City Limits.
Austin Regional Breakdown
For eight years in a row, Austin has ranked first in population growth. Austin is one of the fastest-growing cities in the US, based on per capita GDP, population and economic development, and a decreasing unemployment rate:
- Austin is home to about 965,000 residents, with nearly 2.2 million people living in the Austin-Round Rock metro area.
- The population of Austin has grown by 2.5% year-over-year.
- From 2009 to 2018, Austin’s population increased by nearly 33%.
- Principal cities in the metropolitan area include Austin, Round Rock, Cedar Park, and San Marcos.
- The largest counties in the Austin MSA include Travis, Williamson, and Hays.
- Austin is a magnet for migrating talent, with almost 7% of residents having lived elsewhere just one year earlier.
- The Austin metropolitan population is projected to double in size over the next 30 years, to over 4.5 million people.
- The median age in Austin is 35.2 years, with 57% of the population between 20 and 59.
Austin Job Market Overview
Austin was ranked first for tech salary growth in 2020, with overall wages increasing 2.9% year-over-year. The Austin metro area also has the hottest job market in the US, winning the top spot for the second year in a row:
- The GDP of the Austin-Round Rock MSA is over $159 billion and has grown by nearly 90% over the past decade.
- Employment growth in Austin was nearly 2.9% last year, while median household incomes grew by over 4.2% year-over-year.
- The unemployment rate in metro Austin is 5.3%.
- Employment sectors showing the strongest signs of growth in Austin include construction, trade and transportation, and professional and business services.
- Target industry sectors in the greater Austin area include advanced manufacturing, creative and digital media, clean technology, data management, life sciences, and space technology.
- AMD, Apple, Dell, Cirrus Logic, Home Depot, Legal Zoom, and Oracle are some of the companies with regional or corporate headquarters in Austin.
- Austin is nicknamed “Silicon Hills” due to the number of high-tech companies operating in Austin, such as Apple, Amazon, eBay, PayPal, Facebook, Google, and HomeAway.
- Significant employers in the Austin metro area include Apple, Austin Independent School District, City of Austin, the US Federal Government, State of Texas, and Samsung Austin Semiconductor.
- Major universities and colleges in Austin include the University of Texas at Austin, Concordia University, and Austin Community College.
- Over 90% of Austin residents are high school graduates or higher, and more than 46% hold a bachelor’s degree or an advanced degree.
Austin is within 250 miles of major US shipping ports in Houston, Beaumont, Corpus Christi, and Texas City. Travel is simple, with Dallas, Houston, and San Antonio each less than a three-hour drive from the MSA.
The region’s transportation infrastructure includes two interstate highways and the Burlington Northern Santa Fe and Union Pacific Railroads. Austin-Bergstrom International Airport serves nearly 16 million passengers, traveling to more than 70 national and international destinations.
Austin Industrial Market
E-commerce growth continues to push vacancy levels lower, with rents rising as demand for industrial space in Austin spikes. Industrial development in Austin is growing, including Amazon’s 3.8 MSF fulfillment center and Tesla’s new $1 billion Gigafactory in Southeast Austin:
- Total industrial inventory: 45,237,258 SF
- Average asking rent: $11.32 per SF per year, net
- Vacancy rate: 5.1%
- Absorption: 246,000 SF Q1 2021
- New construction: 199,800 delivered to market with 6,698,790 SF under construction as of Q1 2021
- Largest industrial submarkets: Southeast, Northeast, Round Rock, North Central
Austin Office Market
Although vacancy rates continue to rise, NAI reports that leasing activity in the Austin office market is ticking up, right along with average asking rents for office space in Austin. Earlier this year, the commercial real estate crowdfunding firm CrowdStreet relocated to Austin from Portland, following similar corporate relocations from companies such as Digital Realty Trust and Oracle:
- Total office inventory: 95,475,715 SF
- Average asking rents: $38.27 per SF per year, full-service gross
- Overall vacancy rate: 14.4%
- Absorption: – 440,408 SF Q1 2021
- Leasing activity: 1,021,674 SF
- New construction: 1,240,121 SF delivered to market with 8,033,148 SF of office space under construction
- Largest office submarkets: Northwest, Central Business District, Southwest, East/Southeast
Austin Retail Market
While absorption remains negative and average asking rates have slightly declined, market-wide occupancy in the Austin retail market is holding steady. The overall retail market in Austin is showing signs of stabilization, per CBRE’s quarterly report, with 11 projects brought to market Q1 of this year:
- Total retail inventory: 96,080,983 SF
- Average asking rent: $20.00 per SF per year, NNN
- Total vacancy rate: 5.4%
- Net absorption: – 121,507 SF Q1 2021
- New construction: 414,761 SF delivered with 793,470 SF under construction
- Largest retail submarkets: South, Hays County, Northwest, Southwest
Austin Multifamily Market
Along with new business development, population and job growth are bolstering investor confidence in the Austin multifamily market. Forty-five companies from out-of-state announced plans to relocate to the metro area, including the Tesla Gigafactory that will employ 5,000 people.
While vacancy rates have slightly increased and rents have declined, multifamily transactions in Austin spiked last year with nearly 11,300 new units under construction:
- Total housing units: 882,659
- Renter occupied: 48%
- Average effective rent: $1,266 per month
- Average cap rate: 4.5%
- Median sales price per unit: $161,500
- Vacancy rate: 6.6%
- New construction: 7,637 units delivered in 2020 with 11,295 currently under construction
- Most popular neighborhoods: East Riverside – Oltorf, Anderson Mill – Jollyville, Northwest Hills, Downtown Austin
- Median household income: $80,954
- Per capita income: $41,957
How Crexi Connects Buyers and Tenants to Austin Commercial Real Estate
Austin’s thriving economy draws nationwide tenants and investors to the river-side city. Crexi’s robust search tools make finding the perfect investment or lease property easy, allowing seekers to browse thousands of options with a few clicks.
Property seekers can navigate Austin commercial property for sale or lease by price, rate per square foot, square footage, vacancy, cap rate, asset class, and even submarket.
Upon finding the perfect match, buyers and tenants can connect instantly with the listing broker to obtain more information and discuss terms. Crexi users can also download PDFs, brochures, and flyers as well as submit letters of intent (LOI), all via the property’s detail page.
Intelligence Equips Investors with Data and Market Knowledge
Crexi Intelligence further equips buyers and tenants with the tools needed to make the best commercial property investment decisions.
The Intelligence library houses millions of property records,sales comparables, and over 50 updated MSA reports. The Insights tab, present on every property page, provides principals with real-time data about Austin properties, including average market square footage, asking price, demographic information, and more.
Intelligence is available to buyers, sellers, and tenants on a subscription basis.
How Austin Brokers Thrive with Crexi
Austin brokers use Crexi to market nearly 250 properties for sale and 1600 listings for lease within the city proper.
Crexi connects Austin commercial agents with powerful online tools to market their listings to a national buyer and tenant pool. Each broker’s dashboard reveals real-time lead insights, empowering CRE brokers to engage with potential buyers or tenants seconds after discovering a property.
Austin commercial brokers can market their assets across property types, including:
- Multifamily housing
- Offices developments
- Retail assets
- Industrial buildings
- Land parcels
- Mixed-Use buildings
- Hospitality assets
- Non-traditional units such as self-storage, data centers, etc.
Crexi allows Austin commercial brokers to guide their clients’ listings from market to close and securely manage files with a digital due diligence vault.
And while Crexi’s free broker tools are useful, Crexi’s real advantages materialize with Sale PRO, Lease PRO, and All PRO.
Crexi All PRO
Crexi PRO enhances and streamlines Austin brokers’ workflows with advanced tools to help agents close more deals. PRO brokers have access to highly detailed lead data, boosted listing management tools, and enhanced reporting features to save time and focus on sales.
Brokers on PRO also receive preferential tile placement for their assets at the top of Crexi’s search pages. These searches are powered by machine learning to connect PRO properties to the most relevant buyers and tenants. PRO also includes weekly email blasts, connecting properties to highly relevant audiences, and earns a 10-15% higher engagement rate than industry standards.
PRO users enjoy access to Intelligence as a part of their subscription, allowing them to develop in-market knowledge and provide further value to clients.
To date, Crexi PRO has connected Austin brokers with the over 94,000 leads who have sought Austin properties since 2019 and the over 3 million US leads who bought property on Crexi in 2020.
On average, Crexi PRO brokers successfully engage 125% more leads and win up to eight times more transactions than non-PRO users.