One of the largest defense manufacturers in the world is the latest major company to establish a presence in Austin.
Increasing market demand
Ten months into 2022, there has been 10.4 million sq. ft. of net absorption—including the completion of the Tesla Gigafactory at 4.5 million sq. ft. and Amazon Sat6 at 767,000 sq. ft. for a combined 5.3 million sq. ft.—to the Austin industrial market. In addition, 7.8 million sq. ft. of leasing activity comprised of new leases and renewals took place during the same period. 133 properties 10,000 sq. ft and larger are under construction, tallying 21.4 million sq. ft. with a 49% availability rate. 25.3 million sq. ft. has been added to the Austin Industrial market in the past five years, an almost 30% increase in total inventory, registering at 115 million sq. ft. as of October 2022.
Vacancy at 3.7%
As of October 2022, overall vacancy in the Austin industrial market is at a tight 3.7%, up 10 basis points from last year at 3.6%. Availability is at 11.8%, up from October 2021 at 6.7%. The difference between this figure and the vacancy rate reflects expected future move-outs. As vacancy rates tighten, landlords have pushed the NNN average asking monthly rents up 7.8% to $1.09 per sq. ft.—a noteworthy amount from last year’s $1.02 per sq. ft. Austin’s economy has recovered at one of the fastest rates nationally, and more companies and people continue to move to Texas’ capital city.
Aerospace and security company opens new facility
BAE Systems has expanded its Austin presence with a new $150 million, 390,000-sq.-ft. engineering and production facility at 825 E. Howard Lane in Parmer Austin Business Park in the Northeast submarket. The new BAE campus can house as many as 1,400 employees, with half of the facility to be used for manufacturing. Other activities taking place at the campus are engineering design, laboratory uses, and office. The company will maintain its existing Austin facility at the 90,000-sq.-ft. 6500 Tracor Lane location.
Leta Wauson
Director of Research
[email protected]
tel 713 275 9618