Austin Warehouse Space News
This page provides informative specs on the types of warehouse properties that can be found in Central Texas. Keep up to date with the latest Austin Warehouse Space News and market commentary on this page. Shire Commercial provides support from Georgetown Texas to San Marcos Texas.
A Warehouse space that is really defined by its description. These properties have a designated area that is configured as office space and the remainder is warehouse space. Access doors are grade level and or dock high doors. Ceiling heights vary however they typically start at 16′ in the office area and go up from there into the warehouse area. Restrooms are included in the office and sometimes in the warehouse area.
HVAC-100%? – Maybe
18 Wheeler Access?- depends on the size of the property
Power? 3 Phase yes, is some properties not all.
Visibility- Some, predominantly in Austin it is not on the major freeways but in Industrial business parks.
A good hybrid solution for tenants or buyers because it’s more office-like in it’s environment. There is still some warehouse. Access doors are dock high and or grade level doors. Restrooms are included in the office and sometimes in the warehouse area. Ceiling heights vary however they typically start at 16′ in the office area and go up from there into the warehouse area.
HVAC 100%? – Yes, typically
18 Wheeler Access? Yes, depends on the size of the property
3 Phase Power?- Yes in some properties , not all
Lease rates: higher than others
Visibility? Some, predominantly in Austin it is not on the major freeways but in Industrial business parks.
Simple storage facility, warehouse areas are hot typically.
18 Wheeler Access- Yes, with large space , truck courts
Lease Rates: Cheapest of the warehouse solutions
Office area- None
Visibility? Industrial Business Parks typically versus a standalone solution
Austin Warehoues News Archive
Austin Warehouse Space News
Q1 2023: Vacancy rates stay tight at 5% range. Positive occupancy keeping pace with Q1 2022 data. Approx 16M SF of new construction occurring.
Q4 2022: Predictions for 2023 are that warehouse construction could drop as much as 60% for 2023. Capital costs are going to be the reason. A larger drop may occur in 2024 due to over-development.
Q1 2022: Vacancy rates are now at record lows near 4%, 84% of new construction pre-leased.
Q4 2021: 500,000SF Warehouse construction in Kyle, TX for Tesla parts supplier. Amazon distribution facility to be established in San Marcos. Less than 25% of 10M Warehouse square feet is avail for lease. Demand is outpacing supply.
Q3 2021:For Sale inventory has a low supply of inventory. Vacancy rates remain low with new construction over 4M square feet. Austin warehouse vacancy dips below 6%.
Q2 2021: Vacancy rates dip below 7%, lowest vacancy in 10 yrs. 800,000SF of new construction warehouse spaces for lease to be built in Buda area. These warehouses will accommodate manufacturing uses as well.
Q1 2021: Austin’s warehouse demand continues dropping vacancy rates below 8%. Outlook remains strong near term with new development continuing.
Q4 2020: Warehouse spaces for lease demand is steady, with lower vacancy rates ending in 2020. Austin warehouses did not see a significant decline in activity. Lease rates increased as well.
Austin Warehouse leasing news for the third quarter 2020 shows no significant increases in vacancies. Rates are static and absorption is relatively flat, so holding steady near term. Specific sub-markets like Northwest Austin have vacancy rates below 5 % currently. Forward forecasts for Austin vacancies are as follows: 2021 9.5%, 2022 8.4%, 2023 6.8%
2nd Quarter 2020:Vacancy rates down slightly, and leasing rates increased. Warehouse properties are not seeing effects of COVID -19 as much as other properties. First quarter of 2020 has slightly lower vacancies at 10.5% with slightly lower average lease rates. Q1 2020: Rates are moving down approx $0.25 cents psf to an average of $9.55 psf per yr.
Ending the 2019 year, Austin warehouses properties had overall a steady vacancy rate between 9.8 to 11%. Lease rates for office-warehouses are coming in a bit lower at the end of the 2019 year. Lease rates are in the $0.82 cent range plus NNN expenses. Inventory remains good in Hays County and the Northern part of Austin towards Round Rock.
Q4 2019 trended with slightly more demand which had vacancies ticking below 11%. Overall warehouse vacancies for 2019 have stayed within 1 percentage point up or down in the Austin Metro area. Lease rates remain fairly static with rates up in Flex office space (see info below) moving up to $1.13 per sf per month with standard office warehouse space still averaging $0.85-$1.05 as a base lease rate per square foot per month without expenses. Forecasts for Austin moving forward are positive growth for the next 2 years.
Q3 2019: New construction has softened a bit , showing developers are currently constructing less warehouse inventory moving into Q4 2019. Citywide lease rate averages have remained flat to slightly down. The most popular product demand wise is for office-warehouse, Flex warehouse demand has lessened.
Office-Warehouse and Distribution News for Q1 2019: Lease rates overall for Northeast Austin are up approximately 1/2 percent, this sub-market is for the Round Rock and further east areas. Growth rates are reporting over 3% for this area. The only area that has moved lease rates up higher is the North Central warehouse market in Austin. Projections moving into 2021 are as follows: 5% of the new construction is expected to be delivered thru 2021 and vacancy will come in just under 13%.
Southeast Warehouse Market News :
Of the 8 markets in Austin, the SE represents the highest inventory of all the markets represented. Vacancy rate projections are below 6% for 2019, between now and year end lease rates are expected to increase over 3% with another 3% increase in lease rates for 2020 to 2021.
Central Austin: This sub-market has has the lowest levels of vacancies since 2009 with no new inventory slated to hit the market this year. Projections for development are slated in 2020-2021 , rates of occupancy are not forecasted to have significant impact on the office-warehouse market.
Understanding your Warehouse Needs
Concessions are up to market conditions and we strive to help our clients navigate the sub-market’s ins and outs to determine what is viable. Below are the fundamentals to think about as you get ready to lease or purchase a warehouse property in the Austin Area. Check out our charts on our HomePage of current lease rates for warehouses for detailed information on base rates without NNN expenses included.
Determining what your warehouse property needs are critical because concessions are about trade-offs and value to the buyer or tenant.
- Determine what your must haves are, things you cannot give up in a negotiation such as power requirements, door access, 18 wheeler access , 100% HVAC etc.
- Determine up-front what is your flexibility like? In tight supply markets maximum flexibility is required when it comes to location preferences. Can you give something up to gain something else?
- Outlying areas generally have better sales pricing and lease rates than warehouse properties near or closer to downtown Austin (CBD).
Ready to Move Forward?
Are you ready to move forward? Are you personally familiar with the ins and outs of the Austin warehouse market? A prudent buyer or tenant needs this knowledge so that they can leverage negotiations. As a warehouse specialist broker, Shire Commercial provides Clients with 15+ years of experience. Advantages of being represented? When a Buyer or a Tenant is represented, there is a fiduciary responsibility to you the Client and not to the Landlord or the Seller. Getting great service is an experience and it isn’t something that is tangible. Results are what counts and testimonial proof, you can see what our clients say about us by clicking the button below.