AUSTIN – (By Ralph Bivins, Realty News Report) – The old slogan “Keep Austin Weird” feels less prominent these days as Austin experiences rapid change and upscale development. Classic landmarks like the Armadillo World Headquarters are gone, Threadgill’s has closed, and prime parcels near downtown are being transformed into new projects.
New residential icons now define the skyline. The Independent, a 58-story condominium tower nicknamed “Jenga Tower,” recently opened. Developer CJ Sackman of New York-based Sackman Enterprises completed 70 Rainey, a high-end residential high-rise on the shores of Lady Bird Lake, reflecting the city’s trend toward luxury urban living.
These new projects are not exactly “weird” in the old quirky sense — they represent polished, upscale development. You’re unlikely to see countercultural characters in ponytails parking beat-up pickups in reserved spots at these towers.
The office sector mirrors the residential boom. A 35-story office tower by Trammell Crow is under construction downtown and is already pre-leased by Google, a major tech tenant that continues to expand in the city. Meanwhile, a 66-story mixed-use tower called 6X Guadalupe is rising from the ground under the joint development of Lincoln Property Co. and Kairoi Residential and will become the tallest building in Austin when finished.
Austin’s office market is amid a significant construction surge. CBRE reports more than six million square feet of office space currently underway. With about 54 million square feet of total office inventory in Austin—roughly 34 million square feet of which is Class A—this pipeline represents a meaningful addition to the market.
Despite the large volume of new supply, demand remains strong. Office absorption is healthy, rents are increasing, and the vacancy rate has stayed below 10 percent. As CBRE noted in its third-quarter report, with one quarter left in 2019 the Austin office market was on track for its strongest year ever.
National industry observers agree on Austin’s prospects. The Emerging Trends in Real Estate report from ULI and PwC ranked Austin No. 1 out of 80 cities for overall real estate prospects for 2020, signaling that institutional investors, funds, and major developers are focused on the market.
That influx of institutional capital underscores Austin’s evolution from a quirky, independent-minded town into a major real estate destination. For long-time residents, that change can feel bittersweet: the city gains prominence and amenities, but some of its offbeat charm may fade amid high-rise glass and corporate leases.
Still, many hope Austin will retain its cultural touchstones. Figures like Willie Nelson and local traditions help preserve the city’s identity, offering a reminder that Austin’s creative spirit can endure even as the skyline climbs.
Oct. 2, 2019 Realty News Report Copyright 2019
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