Austin's Real Estate Development Intensifies
Austin is one of the hottest markets, not just in the Lone Star State but in the entire country. That’s why we’re thrilled to bring you The State of the Market event in Austin on March 29.
Cohn Reznick partner Mike Celkis (shown here on the right with Axiometrics' Rick Wilson at a previous Bisnow event) says Austin is a smaller town and has flown under the radar for a long time, but the secret is out. There's lots of interest from institutional investors, lots of transactions and a healthy job market. The city is now exploding with activity, including cranes all over, he notes.
Mike says there are also a lot of affordable housing developers. The tax credits are favorable to build units subsidized through a federal program—a program that Mike says should be expanded.
VTS Southeast regional director Rhett Miller says markets that have a much more diverse tenant roster like Dallas and Austin are safer from downturns like the one Houston is experiencing because it's so dependent on the energy sector. He detects no cooling of tech companies in Austin as different tech organizations continue to host large events and firms like WeWork continue to shop around the market after opening.
On the other hand, HPI partner Sam Houston says tech companies are signing fewer leases. He notes that Houston’s low oil prices are having a small impact on Austin real estate because investors in Austin were taking oil and gas profits and investing them in real estate. Sam says the traditional suburban office park is out of favor and 24-hour areas like the CBD and Domain are the preferred office locations.
But Greenberg Traurig partner Carey Gunn Venditti's with Rhett—tech is still a major player. She points out the huge new Oracle campus being built close to downtown. And Apple’s campus. And Google’s. There’s no slowdown that she’s seen.
She says biotech and medical real estate are growing. The new Dell Medical School, which is part of the University of Texas, is starting to have a ripple effect in which other research, R&D and medical-related concerns are popping up. She also says the southeast corridor is very hot right now. There's a plethora of undeveloped land with many new projects in the planning and construction phase.