AUSTIN – Austin has more than 2.4 million square feet of office space under construction and seven new buildings were completed in the second quarter, according to the Colliers International real estate firm.
Over 188,000 SF of new office inventory delivered during the second quarter, bringing 2014 year-to-date delivered inventory to 587,657 SF, Colliers reported in its second quarter research report.
Citywide vacancy stood at 10.7 percent in the second quarter, down from 11.6 percent in the second quarter of 2013.
Seven buildings totaling 199,286 SF delivered in second quarter, with the most notable delivery being Seaholm Power Plant Building (117,000 SF) which is now 97.0% leased to Athena Healthcare. Other notable deals for Q2 are Dropbox (55,000 SF) at 501 Congress Ave., Whole Foods (40,000 SF) at 311 Bowie and Wework (34,000 SF) at One American Center.
Austin’s office market posted 85,623 SF of positive net absorption in second quarter 2014, pushing year-to-date 2014 net absorption to positive 375,246 SF.
The citywide average rental rate increased 0.9% from $28.33 per SF to $28.59 per SF over the quarter and 4.7% from $26.53 per SF to $27.77 per SF over the year. The average CBD rental rate decreased slightly to $40.94, while the average suburban rental rate increased to $30.71, Colliers reported.
According to local economists, 2014 job growth will remain strong with 68,000 to 72,000 new jobs forecasted for the year. Austin’s unemployment rate fell to 4.1% from 4.6% over the year.