Santa Barbara, Calif. (CommercialEdge) – Halfway through the year, Austin led the nation in office development on a percentage-of-stock basis. Underway projects there represent 6.9 percent of the city’s existing inventory, according to the CommercialEdge’s July U.S. office market report.
Construction of more than 1.5 million sf started in Austin this year, the most of any market in the country. Much of that is due to The Republic, a 48-story tower with more than 800,000 sf of office space along 4th St.
While the market has added office jobs at a faster rate than any other market in the country and has the highest office use, there are still risks of oversupply, especially as the vacancy rate continues to rise.
Washington, D.C., and Houston were the leading Southern markets in terms of sales, with $737 million and $629 million in closed office deals, respectively.
Austin led the region regarding sale prices, with office properties trading at an average of $320/sf.