Market Monday

Welcome to Market Monday, a quick glance at all that’s happened in the Austin CRE market in the last week. Let’s dive into it:

Opening Bell 🔔:

Brandywine Realty Trust continues to shed it’s Austin office portfolio footprint, this time with a sale of the 120,600 sf Quarry Lakes II office building to Brick Row Holdings. The property currently sits at 87.5% leased with HeartFlow Inc and CommScope being the biggest tenants. ProDerm Skin & Surgery signed a lease this quarter here and are anticipated to move into 6,289 sf later this year.

Market Snapshot 📸:

Nearly 230,000 SF has been leased in CBD QTD. It might not seem like much given all the continued development pipeline activity in the submarket, but it’s a significant step in the right direction as Austin’s market resets itself. Perhaps the best sign recovery is on the horizon? Meta officially subleased one of it’s floors at Sixth & Guad to an unknown tenant. The 30,000 sf lease leaves 18 more floors and 558,293 sf left to go but it’s a step forward. We’ve seen nearly 40 transactions in the CBD submarket alone this quarter and with an average 5,875 sf per lease, we’re going to see elevated vacancies for a bit longer. But that was to be expected when the tsunami of new space came rushing into the market with Austin’s largest development wave in history.

Self Care is Getting Bigger In Texas:

The largest spa in Texas is coming to fruition out in Spicewood. Canyon Ranch Resort is a #122M project that is on track for Fall 2026 completion. Located along Lake Travis in Spicewood, the resort will feature facilities for health, fitness, performance, dining, lodging, and outdoor adventures in addition to the spa. The total anticipated finished size has the resort at 224,000 sf and adds to VICI Properties large portfolio in the hospitality industry (same owners of Caesars and MGM Grand in Vegas).

South of The River Aims to Go Vertical:

Developers just can’t seem to help themselves when a prime site presents itself. Hunt Companies becomes the latest to be approved for mixed-use tower development at the current site of 200 E Riverside Dr. Staying to true to what’s being proposed these days, the development was zoned for three high-rise buildings. 1.3 million SF of which would be office space, although that might be reconsidered as plans progress and where the market as a whole sits at that time.

Between this and the ever caught in litigation former Statesman site, the South Congress block just south of the river could look very different in the coming decades but we won’t be holding our breath until shovels actually break ground.

ICYMI: Here’s an exclusive look at 415 Colorado, the latest CBD tower to be delivered. 

Thanks for joining us, we’ll see you next week!

Cory