Austin Retail Market Report

Consumer demand growing across the market. Grocery chain H-E-B has committed to expanding their influence across the metro with at least four new locations slated to open over the next three years, starting with the Manor and Georgetown stores in 2025. This effort is being driven by sustained net in-migration, which is expected to heighten consumer demand for necessities in certain parts of the metro. Suburban areas, including Hays County, have received much of these relocations. This county is likely to continue growing after reporting a 16.4 percent population increase from 2020 to 2023 — a gain that facilitated four consecutive years of retail vacancy compression that lowered the area’s rate to 1.3 percent. Another submarket that recorded vacancy decreases in four of the past five years was the area around Pflugerville, culminating in a rate 60 basis points below the metrowide mean in December 2024. The Downtown-University submarket, meanwhile, could also be poised for another year of vacancy compression, fueled by complex zoning requirements limiting new supply.