The Austin office market experienced another period of negative absorption, registering (802,393) of net demand. Vacancy increased quarter-over-quarter to 19.1% and availability increased to 24.9%.
Average Full-Service Gross asking rates increased to $40.57 per sq. ft., driven due to an increase in both OPEX and NNN asking rates.
Despite the rising vacancy rates and negative absorption, the Austin office market is poised for a strong rebound as numerous companies have announced intentions to relocate to the Capitol or expand their current footprints.
The trend of slowing development activity continued into Q1 2021 with the overall pipeline falling to 5.28 million sq. ft., down from a high of 6.9 million sq. ft. in Q1 2020.