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Market Report

Austin Industrial Market Report

2024 Investment Forecast

One-Third of Austin’s Inventory Opened in Less than a Decade,
Creating Turbulence for Larger Properties

New construction amplifies existing overhang, smaller spaces more insulated. Including this year’s scheduled completions, roughly 39 million of Austin’s 115 million square feet of industrial inventory will have been built since 2017. In the two years following the onset of the pandemic, this rapid pace of construction was well-received, with vacancy falling to a two-decade low in 2021. Conditions changed quickly, however, as Austin’s rate is set to reach double digits in 2024 for the first time in 13 years. The volume of metrowide vacant stock rose by more than 7.3 million square feet across 2022-2023, and this year’s substantial delivery slate is expected to elevate that figure by an additional 3.3 million square feet. Upward vacancy pressure is more evident among 100,000-square-foot-plus spaces, however, as larger facilities have accounted for a significant share of new construction in recent periods. Smaller industrial properties meanwhile are performing better in Austin, as they are not facing the same level of supply-side competition. That dynamic should continue in 2024 with sub-100,000-square-foot projects comprising less than 15 percent of the space set to finalize this year.

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