Austin’s office market finishes on a positive note

Austin, TX – Avison Young today released its Fourth Quarter 2023 Office Market Report for Austin. The office market concluded 2023 on a positive note with 507,000 square feet (sf) absorbed in the fourth quarter, demonstrating signs of tenant optimism.

Vacancy declined for the first time in 18 months, primarily attributed to heightened leasing activity in smaller spaces, contributing to the overall resilience and vitality of the market. Smaller leases, ranging from 1,000 to 5,000 sf, totaled an impressive 1.7 million sf of office space being leased since the commencement of the year.

“Positive absorption, led by the high volume of smaller deals, is an encouraging step as we begin 2024,” said Carl Condon, an Avison Young Principal based in the firm’s Austin office. “Due to vacancy remaining high, this is an ideal time for larger tenants to upgrade into more amenity-rich buildings by taking advantage of the competitive concession packages being offered by landlords.”

Despite shifts in leasing trends, the stability of tenant occupancy persists. The professional, scientific, and technical services sector maintain its prominence as the leading industry, comprising 31% of the occupied spaces.