Austin Market Update: Office Vacancy Ticks Down

As of January, Austin’s office vacancy clocked in at 16.3 percent, down 70 basis points month-over-month, according to CommercialEdge data. That marked the second monthly decline in a row for the fast-growing growing market, where vacancy remains elevated year-over-year.

Meanwhile, the national office vacancy rate rose 20 basis points during the first month of 2022 to 15.7 percent. Other Sun Belt markets, such as Charlotte (14.7 percent) and Phoenix (14.9 percent) recorded lower rates than Austin, while Dallas (17.6 percent), Atlanta (21.7 percent) and Houston (24.3 percent) registered higher vacancy.

Following Samsung’s selection of Taylor, Texas for the construction of its $17 billion semiconductor plant last November, in January another technology company announced that it is eyeing Caldwell and Williamson counties for an upcoming $40 billion chip plant. Micron Technology Inc. is the fourth-largest semiconductor company in the world and the new project is expected to create 10,000 jobs.

Despite the recent decline, a construction boom in the Texas capital increased office vacancy by 420 basis points year-over-year through January. Seattle was the only U.S. market that posted a larger year-over-year gain, with a 520-basis-point increase.

Austin Northwest (25.4 percent), Austin East (20.0 percent) and Downtown (19.1 percent) were the submarkets with the highest vacancy in January. On the other side of the spectrum, Round Rock (5.8 percent), Cedar Park (8.0 percent) and Austin North (6.9 percent) recorded the lowest rates.

CommercialEdge covers 8M+ property records in the United States. View the latest CommercialEdge national monthly office report here.