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Lack of CBD availability fuels leasing activity in nearby submarkets
Available Class A space in Austin’s most desired submarkets has been rapidly decreasing, evidenced by an all-time-low Class A availability rate of 8.0% in the Central Business District (CBD) as of Q3. This lack of availability in prime locations has forced sizeable occupiers to look elsewhere to find large blocks of contiguous space. In fact, there are only two contiguous existing options in the core greater than 50,000 square feet (sf). As a result, the Northwest and Southwest submarkets are benefiting, seeing 330,799 sf & 280,884 sf of activity in Q3 2019, respectively. Abbott Laboratories inked the largest deal in the Southwest submarket at 130,152 sf, while WeWork took 42,429 in the Northwest prior to its IPO collapse. The North submarket, has experienced some of this spillover this quarter as well, as Amazon took an additional 107,377 sf at 11815 Alterra Parkway.