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AQUILA Commercial is understands that real time market data helps our clients make smart, informed real estate decisions. This report is produced and distributed quarterly. To receive our updates, opt in at aquilacommercial.com.
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A U S T I NMARKETR E P O R T
2Q 2015
AQUILAKNOWSAUSTIN
KEEPING YOU INFORMEDAQUILA Commercial is dedicated to
providing quality service to our clients.
We understand that real time market data
helps our clients make smart, informed real
estate decisions. This report is produced
and distributed quarterly. To receive our
updates, opt in at aquilacommercial.com.
DISCLAIMER This report utilizes various
real estate and economic data sources. The
information contained herein is confidential
and proprietary in nature. No warranties or
guarantees are made as to the accuracy of
the information contained herein.
Hartland Plaza; Photo by Scott Mason Photography
32Q 2015 Austin Market Report
Not only is Austin’s population growing at an amazing
rate, but so is its economy. These trends are reflected in
the abundant volume of new construction taking place in
The Capitol City. Accordingly, AQUILA’s Market Research
team turns its attention to development this quarter.
In addition to the Pipeline of Projects and submarket
analyses we always provide, included in this quarterly
report is AQUILA’s research showing the effects of new
office construction on rental rates in existing buildings
located in close proximity to new product.
July 2014 saw Austin's Central Business District's (CBD)
first office delivery of scale since Frost Tower’s completion
in 2004. As the national and local economies expanded
after the Great Recession, and in light of a dearth of
new supply, a demand surplus was established for CBD
office space. Colorado Tower and IBC Bank Plaza were
the first beneficiaries of this demand, as both buildings
were nearly 100% leased upon their completion. Shortly
thereafter, the Seaholm power plant redevelopment and
501 Congress experienced similar successes.
As has historically been the case in Austin, CBD trends
percolate into the Northwest (NW) and Southwest (SW)
submarkets. Over 1 million square feet of new office
product across seven projects broke ground in the
SW along with six projects consisting of over 700,000
square feet in NW Austin. Impressively, over 60% of this
new inventory, defined as projects that broke ground
between 1Q 2014 and 1Q 2015, was preleased. Since
1Q 2014, there has been over 1.4 million square feet
of absorption in the three major submarkets justifying
developer optimism to date. But what about the health of
the existing pipeline? Will we see continued absorption
at a comparable pace?
VIEW FROMTHE
EAGLE’S NESTRYAN PARZICK
Market Research Director
AQUILA Commercial
4
As of the close of 2Q 2015, there was almost 3 million
square feet of new office product under construction
across Austin—of which 34% is preleased—as well as
a multitude of other projects that are planned for all
submarkets. Companies like Google, Apple, General
Motors, Main Street Hub and Amazon are all expanding
in Austin and committing to large blocks of space in the
process. New companies are relocating to Austin to take
advantage of Texas's status as a Top 3 state with the most
competitive corporate tax environments1 and Austin's
reputation as the 12th Most Business-Friendly City in the
U.S.2 The Austin Chamber of Commerce has tracked 21
new companies expanding or relocating to Austin in 2015,
with eight of them headquartered here in Austin. For 2Q
2015, the Austin housing market was ranked second in
the Large MSA category of the Leading Markets Index by
the National Association of Home Builders. According to
the Federal Reserve, Austin currently has a 5.3% annual
job growth rate-well above what is needed to maintain
positive absorption. A compilation of forecasts predict
over 3% job growth for the rest of the year, so we remain
bullish on the Austin market and believe the new product
under construction will be absorbed while the overall
market will maintain healthy levels of vacancy.
AUSTIN BEATS THE STATE AND THE NATION IN UNEMPLOYMENT
3.1% 4.2% 5.3%
73% 67% 55%
3.1% 4.2% 5.3%
73% 67% 55%
3.1% 4.2% 5.3%
73% 67% 55%
AUSTINDown from 4.1% in 1Q 2015
TEXASDown from 5% in 1Q 2015
U.S.Down from 6.1% in 1Q 2015
HISTORICAL SNAPSHOT OF AUSTIN OFFICE SPACE
Quarter Net Rentable Area Direct Available SF Net Absorption* Direct & Sublease Vacancy Rate
Average Class A Full Service Rental Rate
2013 Q3 42,600,634 5,130,116 804,387 12.42% $33.15
2013 Q4 42,444,966 4,960,873 (14,664) 12.14% $33.32
2014 Q1 42,444,966 4,815,598 167,798 11.74% $33.47
2014 Q2 42,475,999 4,647,525 6,277 11.79% $33.44
2014 Q3 42,720,370 4,373,103 377,613 11.41% $33.67
2014 Q4 42,784,115 4,068,526 420,985 10.56% $34.78
2015 Q1 43,665,210 4,612,974 383,535 11.49% $36.27
2015 Q2 44,534,490 4,795,149 585,639 11.90% $35.60
* Absorption includes sublease space. Numbers based on CBRE statistics.
1 Bloomberg BNA. "When States Compete: How State Tax Climates Impact Corporate Investment." June 2015. Bloomberg BNA. White Paper. 12 July 2015.
2 Britt, Russ. America's Most Business-Friendly Cities. 22 May 2015. 12 July 2015.
52Q 2015 Austin Market Report
AUSTIN CITYWIDE2Q UPDATE
585,639 SFNet Absorption
11.90%Direct & Sublease Vacancy Rate
$35.60Avg. Class A Full Service Rental Rate
LEASING ACTIVITYVacancy rates increased again this quarter but only mini-
mally, moving from 10.56% to 10.77%. As was the case last
quarter, a large volume of net rentable area came online
that increased available space. Even with the 869,280 sf
delivered, there was still significant positive absorption of
585,639 sf. Since the last quarter, full service asking rates
across Class A buildings decreased by $0.67, from $36.27
to $35.60. This decrease could be a correction stemming
from last quarter when rates jumped by almost $1.50/sf,
whereas most previous quarters experienced much small-
er increases.
6
CITY VIEW PORTFOLIO
LITTLEFIELD & SCARBROUGH BUILDINGS
SNAPSHOT:CAPITAL MARKETSMAJOR SALES TRANSACTIONSCapital market activity remained hot in 2Q 2015 with Austin office assets continuing to fetch record pricing in both on and
off market transactions.
This portfolio of eight buildings also
includes a 5.64 acre parcel that is
approved for development of a new
64,550 sf office building.
RIATA CORPORATE PARK
Market Southwest
Class A
Size 280,000 SF
Buyer Dividend Capital Diversified Property Fund
Seller Pearlmark Real Estate
Price $68,750,000
Price/SF $245.54
Notes Four Buildings
SOLD SOLD SOLD
SOLDMarket Northwest
Class A
Size 673,622 SF
Buyer Accesso Partners
Seller Spear Street Capital
Price +/- $165,037,390
Price/SF +/- $245.00
PERRY BROOKS TOWER
Market CBD
Class A-
Size 136,585 SF
Buyer Clarion Partners
Seller Barton Creek Ltd
Price +/-$65,560,000
Price/SF $479.99
Notes None
Market CBD
Class A
Size 240,568 SF
Buyer David Kahn
Seller DivcoWest
Price $84,046,680
Price/SF $349.37
Notes Two buildings
72Q 2015 Austin Market Report
MOVING OUTThe following large users left for
new spaces or downsized.
AMDvacated 52,526 sf at The Summit
at Lantana as their presence in the
campus continues to decrease.
PUBLIC STRATEGIES moved out of 40,207 sf in San
Jacinto Center and moved into
18,012 SF in IBC Bank Plaza (also
within the CBD).
ATLASSIANleft 28,495 sf in 816 Congress and
moved into 72,486 SF in Colorado
Tower (also within the CBD).
MAJOR LEASES SIGNED Major leases signed this quarter over 25,000 sf:
SOUTHWEST• Apple signed a lease to occupy the entire Capital Ridge development
(218,000 sf), which just delivered this quarter.
• SolarWinds expanded in The Summit at Lantana with an additional 64,947 sf. It had already been leasing 230,000 sf in the former AMD campus.
NORTHWEST• Q2eBanking expanded and extended its lease at the still under construc-
tion Aspen Lake Two. In total, they will now occupy the whole building (128,900 sf).
• Google expanded its presence in 7700 Parmer by signing an expansion for 63,948 sf.
• An undisclosed tenant expanded by 39,330 sf in Research Park Plaza I.
• RenewData renewed its existing 35,759 sf at 9500 Arboretum.
• Rockwell Automation renewed 27,642 sf at 9500 Arboretum.
SOUTH• Younicos opened its North American headquarters, signing a 32,500 sf
lease in the newly completed 3100 Alvin Devane.
CENTRAL• Snow Software signed a new lease for 27,149 sf at Capstar Plaza.
SUBMARKETMAP
CBD
Central
East/Northeast
North
Northwest
Round Rock
South/Southeast
Southwest
8
AUSTIN OFFICEDEVELOPMENT PIPELINE
2015 2016 2017 planned3Q
Encino Trace I 160,849 SF Southwest
Encino Trace II 160,849 SF Southwest
Paloma Ridge I 106,200 SF Northwest
Paloma Ridge II 106,200 SF Northwest
Parmer 3.2 192,000 SF East
4Q
Lakes at TechRidge - Phase I 137,000 SF East
Lamar Central 131,722 SF Central
NorthShore 22,326 SF CBD
Domain 1 124,578 SF Northwest
Quarry Oaks III 142,570 SF Northwest
Research Park Plaza V 172,854 SF Northwest
1Q
5th + Colorado 179,000 SF CBD
Eastside Village 94,500 SF East
2Q
Aspen Lake Two 129,000 SF Northwest
Domain 5 74,787SF Northwest
4Q
Domain 8 255,000 SF Northwest
3Q
The Diamond Bldg. at Mueller 35,015 SF East
This timeline shows office projects over 30,000 SF that have either broken ground or will be breaking ground soon and
the estimated year and quarter of delivery.
92Q 2015 Austin Market Report
2015 2016 2017 planned
1Q
500 W. 2nd Street 489,404 SF CBD
Future Developments
310 Comal 37,500 SF East
604 W. 6th Street 31,035 SF CBD
801 Barton Springs 90,000 SF South
Amber Oaks - Phase I 90,300 SF Northwest
Amber Oaks - Phase II 90,300 SF Northwest
Amber Oaks - Phase III 45,000 SF Northwest
Aspen Lake Three 128,700 SF Northwest
Austin Music Hall - CBD
Cityline at MLK 150,000 SF East
Lantana Ridge I 87,500 SF Southwest
Lantana Ridge II 87,500 SF Southwest
Mueller Market District 3,500,000 SF East
Paloma Ridge C 112,500 SF Northwest
Rainey Gateway 355,000 SF CBD
Regency Park 90,000 SF Southwest
Shoal Creek Walk 210,000 SF CBD
Terrace 3 203,130 SF Southwest
Terrace 4 285,663 SF Southwest
Terrace 5 218,809 SF Southwest
The Backyard - Bldgs. B, J, & H
171,450 SF Southwest
The Park @ Mueller 116,000 SF East
The Waterfront 625,000 SF South
Waller Park Place 325,000 SF CBD
10
HOW DO NEW OFFICE DEVELOPMENTS AFFECT SURROUNDING RENTAL RATES?
-$6
-$5
-$4
-$3
-$2
-$1
$0
$1
$2
$3
$4
-30 -20 -10 0 10 20 30
Pric
e Ab
ove/
Belo
w A
vera
ge A
ustin
Avg
-As-
Is N
NN
($/s
f)
Quarters Before/After New Construction
Average of New Construction Rental Price Compared to Austin Market Trend Line
6.5 years to 15 months prior to new build: The starting average rental rate trend moves from about $4.00 below to about $1.25 above the average Austin rental rate. This rise in rates is likely due to the increasing demand in the area immediately surrounding a newly constructed building, which drives developers to build new product there.
4.5 years and beyond: The difference in rates compared to the overall Austin market bottoms out and the cycle starts over. Leases are starting to expire from the new deals struck during the construction process, so demand is building again.
9 months to 4.5 years after new build: Rates in the area surrounding the new development begin to fall with respect to the overall market. Surrounding buildings are now competing for tenants with the new office space. The leases that were signed at the new building have alleviated the increased demand.
15 months prior to 9 months after new build: Rental rates level off to about $1.25 above the average Austin market rate. This can be explained by the new supply catching up to the demand in the immediate area of the new construction during the lease up period, creating a temporary equilibrium. Preleasing generally begins during this time period coinciding with construction being far enough along to allow potential tenants to see the space, so the pent up demand starts to get addressed.
WHAT DOES THIS MEAN FOR YOU?Tenants: If you are looking at space or renewing in a location close to a new project, the ideal window of opportunity
to negotiate a renewal is either as far prior to a new building's delivery or a couple of years after the new development
has delivered.
Landlords: If potential tenants are negotiating with you during the second or beginning of the third time period, it
may behoove you to do what you can to secure as much term as possible. This may be in your best interest since your
rental rates will likely have to drop by a dollar or more, relative to the rest of the market, the further away from the
new construction you get.
To see the methodology used for this report view page 50 in the Appendix.
112Q 2015 Austin Market Report
291,638 SFNet Absorption
10.20%Direct & Sublease Vacancy Rate
$41.90Avg. Class A Full Service Rental Rate
CENTRALBUSINESSDISTRICT
2Q UPDATELooking at all classes of buildings across
the CBD, there was a significant decrease
in vacancy rates from 12.81% to 10.20%
between 1Q 2015 and 2Q 2015. This
decrease reflects the high demand for
downtown office space. The competitive
set of CBD buildings (Class A buildings
located in, or near, the core of downtown)
actually saw a slight increase in vacancy
rates, moving 51 basis points higher, from
7.52% to 8.03%. This increase is partially
attributable to the delivery of 501 Congress,
a 122,551 sf Class A building that is 81%
occupied. Additionally, some of the lower
tier buildings—ones not included in the
competitive set—increased occupancy.
12
The second quarter also saw
a decrease in Class A asking
rental rates for the overall CBD
submarket, dropping from
$43.83 to $41.90. Last quarter
it was suggested in this report
that the non-competitive
set buildings in the CBD had
higher vacancy rates partially
due to high full service rental
rates. It looks as though that issue was addressed this
quarter with lower asking rates in these spaces, pulling the
overall submarket rates down with them. The competitive
set continues to see full service asking rates raised, though,
as it remains a strong landlord’s market. The competitive
set increased rates for the 13th straight quarter, as rates
climbed from $47.28 to $47.74. It bears repeating, the
demand for higher quality space has allowed landlords to
continue to push rates while inferior buildings adhere to a
more competitive set of market forces.
501 Congress was the sole
new delivery in the CBD
this quarter. Its major
tenants include Dropbox
and Charles Schwab. No
other Class A buildings
are scheduled to deliver
downtown until 1Q 2016,
when 5th + Colorado
brings 179,000 sf online.
Currently, this development has almost 17,000 sf pre-
leased with a couple of other leases reportedly close to
being finalized.
In the entire competitive set within the CBD, there are only
five large blocks of available space for lease over 20,000 sf.
This is very limiting to potential tenants who want to move
or expand downtown. With the only large blocks available
on the horizon belonging to the 5th + Colorado and 500 W
2nd developments, the CBD will continue to build pressure.
THE DEMAND FOR HIGHER QUALITY SPACE HAS ALLOWED LANDLORDS TO CONTINUE TO PUSH RATES WHILE INFERIOR BUILDINGS ADHERE TO A MORE COMPETITIVE SET OF MARKET FORCES.
RetailMeNot at 301 Congress; Photo by Third Eye Photography
132Q 2015 Austin Market Report
CBD DEVELOPMENT& LARGE AVAILABILITY
Building Available SF/ % Preleased
Max. Contiguous
Total SF/ Units/Rooms
Estimated Delivery Status Use
1 600 Congress 42,985 SF 29,798 SF - - Existing Office
2 Frost Bank Tower 26,607 SF 26,607 SF - - Existing Office
3 One Congress Plaza 78,908 SF 23,479 SF - - Existing Office
4 301 Congress 73,352 SF 20,899 SF - - Existing Office
5 San Jacinto Center 83,639 SF 20,338 SF - - Existing Office
6 5th + Colorado 9% 19,000 SF 179,000 SF 1Q 2016 UC Office
7 NorthShore 100% - 23,592 SF 1Q 2015 UC Office
8 500 West 2nd 43% 33,583 SF 489,404 SF 1Q 2017 UC Office
9 Westin - - 326 Hotel Rooms 3Q 2015 UC Hotel
10 Fairmont - - 1,066 Hotel Rooms 3Q 2017 UC Hotel
11 Hotel Van Zandt - - 319 Hotel Rooms 3Q 2015 UC Hotel
12 Hotel Zaza/Gables - - 226 MF Units, 160 Hotel Rooms 4Q 2016 UC Hotel/MF
13 5th & West - - 154 MF Units 4Q 2017 UC MF
14 Shoal Creek Walk - - 210,000 SF - Future Office
15 604 W 6th - - 31,035 SF - Future Office
16 Novare/Post Office - - TBD - Future Office
17 Austin Music Hall - - TBD - Future Office
18 801 Barton Springs - - 85,000 SF - Future Office
19 Austin American Statesman - - TBD - Future Office
20 Waller Park Place - - 325,000 SF - Future Office
21 Rainey Gateway - - 355,000 SF - Future Office
22 The Independent - - 370 MF Units - Future MF
23 Travis County - - TBD - Future Mixed Use
Office projectsUnder construction
OFFICE UNDER CONSTRUCTIONHOTEL/RESIDENTIAL UNDER CONSTRUCTIONFUTURE DEVELOPMENTSEXISTING AVAILABILITIES
6th Street
5th Street
Barton Springs Rd.
N. L
amar
Blv
d.
Cong
ress
Ave
.
11th Street
S. 1
st S
tree
t
Cesar Chavez St.
6th Street6th Street6th Street
5th Street
5th Street
5th Street
Barton Springs Rd.
Barton Springs Rd.
Barton Springs Rd.
N. L
amar
Blv
d.
N. L
amar
Blv
d.
N. L
amar
Blv
d.
Cong
ress
Ave
.
Cong
ress
Ave
.
Cong
ress
Ave
.
11th Street11th Street11th Street
S. 1
st S
tree
t
S. 1
st S
tree
t
S. 1
st S
tree
t
Cesar Chavez St.
Cesar Chavez St.
Cesar Chavez St.
FrostBankTower
500 W. 2nd
Northshore
TheIndependent
ShoalCreekWalk
604 W.Sixth
Novare/Post Office
600Congress
301Congress
OneCongressPlaza
FairmontHotelWallerParkPlace
RaineyGatewayHotel Van ZandtAustinAmericanStatesman
801 BartonSprings
San JacintoCenter
Westin
TravisCounty
Hotel Zaza/Gables 5th +Colorado
5th &West
AustinMusic Hall
Hotel/ResidentialUnder construction
Existing Availabilities
Future Developments
14
CBD BY THE NUMBERS
Quarter Net Rentable Area Direct Available SF Net Absorption* Direct & Sublease Vacancy Rate
Average Class A Full Service Rental Rate
2013 Q3 9,084,414 1,058,513 (26,803) 12.07% $41.39
2013 Q4 9,084,414 1,045,081 6,826 12.00% $41.61
2014 Q1 9,084,414 1,032,112 17,164 11.81% $41.45
2014 Q2 9,084,414 1,021,461 (13,728) 11.96% $40.88
2014 Q3 9,252,285 1,041,014 153,098 11.90% $41.39
2014 Q4 9,252,285 802,517 227,661 9.44% $43.13
2015 Q1 9,768,770 1,135,835 139,236 12.81% $43.83
2015 Q2 9,809,755 870,240 291,638 10.20% $41.90
CBD SUBMARKET
0%
3%
6%
9%
12%
15%
18%
$39.00
$40.00
$41.00
$42.00
$43.00
$44.00
$45.00
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Rent
al R
ate
Average Class A Full Service Rental Rate Direct & Sublease Vacancy Rate
0%
2%
4%
6%
8%
10%
12%
14%
-
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Avai
labi
lity
(SF)
Direct Available SF Sublease Available SF Direct & Sublease Vacancy Rate
AVAILABLE SF VS. VACANCY RATE
83%
84%
85%
86%
87%
88%
89%
90%
91%
(50,000)
-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2O
ccup
ancy
Rat
e
Abso
rptio
n (S
F)
Net Absorption* Direct & Sublease Occupancy Rate
NET ABSORPTION
VACANCY RATES VS. RENTAL RATES
* Absorption includes sublease space. Numbers based on CBRE statistics.
152Q 2015 Austin Market Report
7.5
8.0
8.5
9.0
9.5
10.0
10.5
11.0
0%
5%
10%
15%
20%
25%
30%
35%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Mar
ket S
ize
(Mill
ions
of S
F)
Tota
l Vac
ancy
Rat
e (%
)
Market Size Historic Vacancy Rate AQUILA Model 1% Job Growth 3% Job Growth
3% Job Growth
1% Job Growth
3% Job Growth
1% Job Growth
NorthShore
5th + Colorado
500 W 2nd
AUSTIN CBD OFFICE RENTAL RATE PROJECTIONS
AUSTIN CBD OFFICE VACANCY RATE PROJECTIONS
$15
$20
$25
$30
$35
$40
$45
$50
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Full
Serv
ice
Rent
al R
ates
($)
Historic Rental Rate AQUILA Model 1% Job Growth 3% Job Growth
3% Job Growth
1% Job Growth
16 7700 Parmer, Building A; Photo by Third Eye Photography
172Q 2015 Austin Market Report
NORTHWEST SUBMARKET2Q UPDATE
116,457 SFNet Absorption
11.56%Direct & Sublease Vacancy Rate
$32.74Avg. Class A Full Service Rental Rate
LEASING ACTIVITYThe vacancy rate decreased slightly in the Northwest
submarket last quarter, moving from 11.65% to 11.56%
across all building classes. Our competitive set of buildings
(newer suburban office buildings that typically have
structured parking, amenities such as conference rooms,
workout facilities and/or delis) saw its vacancy rate shrink
even further, lowering from 9.93% to 9.00%. This larger
reduction in vacancy rates in the competitive set continues
to further the notion that higher end buildings are in
demand and continue to attract tenants looking for nicer
18
NORTHWESTSUBMARKET UPDATE
space.
Overall asking rental rates of Class A buildings in the
Northwest submarket climbed for the 6th consecutive
quarter, moving up to $32.74 from $32.06 last quarter.
The competitive set of buildings increased at a slower rate,
albeit still making a large gain of $0.44 from last quarter.
As with almost all of Austin, the NW submarket remains a
landlord’s market.
A correction to last quarter’s report regarding Apple’s
purchase of Riata Crossing Buildings 1-4 has been made
in this quarter’s report. Apple did, in fact, purchase
the 357,375 sf of office space they already leased from
Spear Street Capital, but they then resold the buildings
to DivcoWest days later. Apple is still the tenant in all
four buildings. The correction is reflected in the 1Q 2015
Competitive Set numbers.
Braker Pointe III (195,230 rsf), was added to the competitive
set this quarter due to its sole tenant, Harcourt, announcing
it will relocate to La Frontera in July of 2016. The currently
100% leased building is being marketed to potential
tenants to backfill Harcourt.
Domain 5 broke ground this quarter and is slated to bring
74,787 sf to the NW Arboretum/Domain micromarket
in March of 2016. This adds to the already underway
Domain 1 (124,557 sf; 0% preleased - delivers December
of 2015), Research Park Plaza V (172,854 sf; 0% preleased
– delivers November 2015), Quarry Oaks III (137,615 sf;
100% preleased by Bazaarvoice – delivers December
2015), Aspen Lake Two (129,000 sf; 100% preleased by
Q2eBanking – delivers May 2016), and the Paloma Ridge
development (212,400 sf split between two buildings;
0% preleased – delivers August 2015). Domain 8 is close
to starting construction, which will be the largest office
project in the Domain with 255,000 sf of office space and is
pegged to come online in December of 2016.
3305 Steck; Photo by Scott Mason Photography
192Q 2015 Austin Market Report
As has historically been
the case, the Arboretum/
Domain micromarket
outperformed the
other two Northwest
micromarkets in terms of
rental rates and vacancy
rates. This micromarket
is in high demand as
Austinites flock to live, work, and play in the area. In
addition to the Domain developments mentioned earlier,
Brandywine Realty Trust is in the process of bringing to
market two existing office buildings (345,000 sf) adjacent
to the Domain on the IBM Broadmoor campus that will be
available in April 2016.
The vacancy rate in the Shepherd Mountain competitive set
continued to decrease and is now down to 12.41%, which
is in line with traditional levels in this micromarket. With
the recent strong absorption in the buildings belonging to
this set, rental rates continue to climb higher as well.
The Far Northwest
micromarket continues to
raise its asking full service
rental rates, even with the
slight increase in vacancy
rate. This increase in vacancy
rates is deceptive since direct
available space actually
declined but sublease
availability rose. Speculative buildings under construction
in this micromarket (Paloma Ridge and Research Park
Plaza V) are yet to sign leases, although large blocks of
available space grow increasingly scarcer.
NORTHWESTMICROMARKETS
Arboretum/Domain
Far Northwest/Round Rock
Shepherd Mountain
THE OVERALL ASKING RENTAL RATES OF CLASS A BUILDINGS IN THE NORTHWEST SUBMARKET CLIMBED FOR THE 6TH CONSECUTIVE QUARTER, MOVING UP TO $32.74 FROM $32.06 LAST QUARTER.
20
NORTHWEST BY THE NUMBERSNORTHWEST OVERALL SUBMARKET PERFORMANCE
9.0%
9.5%
10.0%
10.5%
11.0%
11.5%
12.0%
$27.00
$28.00
$29.00
$30.00
$31.00
$32.00
$33.00
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Rent
al R
ate
Average Class A Full Service Rental Rate Direct & Sublease Vacancy Rate
0%
3%
6%
9%
12%
15%
-
500,000
1,000,000
1,500,000
2,000,000
2,500,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Avai
labi
lity
(SF)
Direct Available SF Sublease Available SF Direct & Sublease Vacancy Rate
AVAILABLE SF VS. VACANCY RATE
87.0%
87.5%
88.0%
88.5%
89.0%
89.5%
90.0%
90.5%
91.0%
91.5%
92.0%
(200,000)
(100,000)
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Occ
upan
cy R
ate
Abso
rptio
n (S
F)
Net Absorption* Direct & Sublease Occupancy Rate
NET ABSORPTION
VACANCY RATES VS. RENTAL RATES
Quarter Net Rentable Area Direct Available SF Net Absorption* Direct & Sublease Vacancy Rate
Average Class A Full Service Rental Rate
2013 Q3 16,747,039 1,914,000 682,711 11.77% $29.09
2013 Q4 16,747,039 1,745,316 158,788 10.82% $27.33
2014 Q1 16,747,039 1,635,834 102,128 10.21% $29.20
2014 Q2 16,697,337 1,493,813 (12,658) 10.02% $29.89
2014 Q3 16,697,337 1,566,544 (103,939) 10.64% $30.65
2014 Q4 16,817,337 1,540,054 137,486 10.46% $30.83
2015 Q1 17,154,310 1,879,975 98,887 11.65% $32.06
2015 Q2 17,269,310 1,819,734 116,457 11.56% $32.74* Absorption includes sublease space. Numbers based on CBRE statistics.
212Q 2015 Austin Market Report
$15
$20
$25
$30
$35
$40
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Full
Serv
ice
Rent
al R
ates
($)
Historic Rental Rate AQUILA Model 1% Job Growth 3% Job Growth
3% Job Growth
1% Job Growth
10.0
11.7
13.3
15.0
16.7
18.3
20.0
0%
5%
10%
15%
20%
25%
30%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Mar
ket S
ize
(Mill
ions
of S
F)
Tota
l Vac
ancy
Rat
e (%
)
Market Size Historic Vacancy Rate AQUILA Model 1% Job Growth 3% Job Growth
3% Job Growth
1% Job Growth
Paloma Ridge A & B
905 & 906 BroadmorAspen Lake TwoDomain 5
Domain 8Quarry Oaks IIIDomain 1Research Park Plaza V
NORTHWEST SUBMARKET OFFICE RENTAL RATE PROJECTIONS
NORTHWEST SUBMARKET OFFICE VACANCY RATE PROJECTIONS
22
NORTHWEST AUSTINLARGE OFFICE AVAILABILITY
Building Name Total Available Space Percent Subleasable
1 Amber Oaks F 78,034 SF -
2 7700 Parmer A 62,000 SF -
3 7700 Parmer B 155,774 SF -
4 7700 Parmer A 50,000 SF -
5 Research Park Five 39,237 SF -
6 Research Park Place 8 33,518 SF -
7 Riata Corporate Park 4 93,737 SF -
8 Domain 7 45,000 SF -
9 Braker Pointe I 25,694 SF -
10 Atrium Office Center 42,740 SF -
11 UFCU Plaza 25,161 SF -
12 Prominent Pointe I 27,727 SF -
13 Lakewood Center I 47,389 SF 95%
14 Ladera Bend 3 56,196 SF 100%
15 Park Centre 3 34,761 SF -
16 River Place Corporate Park VII 32,664 SF 100%
17 Travesia Corporate Park 3 33,555 SF -
89
1011
DOMAINArboretum
Pflugerville
Cedar Park Round Rock
LAKE TRAVIS
1
2 34
567
12
1314
15
16
17
Shepherd mountain
232Q 2015 Austin Market Report
DOMAINArboretum
Pflugerville
Cedar ParkRound Rock
LAKE TRAVIS
Shepherd mountain
11
1
102
7 89
3
46 5
NORTHWEST AUSTINOFFICE DEVELOPMENT
Building Total SF Percent Preleased Estimated Delivery Status
1 Paloma Ridge A & B 212,400 SF 0% 3Q 2015 Under Construction
2 Aspen Lake Two 129,000 SF 100% 2Q 2016 Under Construction
3 Research Park Plaza V 172,854 SF 0% 4Q 2015 Under Construction
4 Quarry Oaks III 137,615 SF 100% 4Q 2015 Under Construction
5 Domain 1 124,578 SF 0% 4Q 2015 Under Construction
6 Domain 5 74,787 SF 0% 2Q 2016 Under Construction
7 Amber Oaks Phase I 90,300 SF 0% - Planned
8 Amber Oaks Phase II 90,300 SF 0% - Planned
9 Amber Oaks Phase III 45,000 SF 0% - Planned
10 Aspen Lake Three 128,700 SF 0% Planned
11 Domain 8 255,000 SF 0% 4Q 2016 Planned
Under Construction Planned
24
252Q 2015 Austin Market Report
SOUTHWEST SUBMARKET2Q UPDATE
26
SOUTHWESTSUBMARKET UPDATE
The vacancy rate across all buildings in the Southwest
submarket are deceptively high this quarter, climbing
up to 12.21% from 7.98% last quarter. This is due to the
methodology CBRE employs when collecting vacancy data,
which counts leased space that has not been moved into
as vacant, hence “available.” Since we use CBRE’s data for
the overall market performance analysis, this contradicts
the dataset for the competitive set buildings (newer
suburban office buildings that typically have structured
parking, amenities such as conference rooms, workout
facilities and/or delis) due to the following: Capital Ridge,
Rollingwood I & II and 3700 San Clemente all delivered
this quarter in the SW submarket. Capital Ridge was fully
leased by Apple, Rollingwood has 206,709 sf of 214,587
sf leased, and 3700 San Clemente has 38% of 249,870 sf
leased. All of these leased spaces are considered vacant
by CBRE’s data until the tenants move in, but we do not
182,561 SFNet Absorption
12.21%Direct & Sublease Vacancy Rate
$33.76Avg. Class A Full Service Rental Rate
Treemont Plaza; Photo by Scott Mason Photography
272Q 2015 Austin Market Report
consider these spaces as available in our competitive set.
In fact, our competitive set of SW buildings saw vacancy
rates decrease from 8.29% to 8.25% due to preleasing
activity.
Overall asking rates for Class A buildings in the Southwest
submarket decreased by $0.59 since last quarter, whereas
our competitive set of buildings increased by $0.57. This
occurrence can be explained by the high demand for higher
quality space, allowing landlords to continue to push rates
while inferior buildings adhere to a more competitive set
of market forces.
The Near Southwest micromarket has much higher
asking rental rates than the Far Southwest micromarket,
though both continue to rise. The vacancy rates for both
micromarkets remain low, even with the delivery of
multiple buildings this quarter. To further highlight the
low level of vacancy in the historically tight Far Southwest
micromarket, consider the following example. If 3700
San Clemente were taken out of the equation (currently
only 42% leased), there would be a 5.98% vacancy rate
instead of an 8.85% rate in the micromarket. One building
represents almost a 3% change in vacancy rates.
SOUTHWESTMICROMARKETS
Far Southwest
Near Southwest
FEATURED LEASING OPPORTUNITY: TREEMONT PLAZATreemont Plaza, located at 3001 Bee Caves Road and
just minutes from downtown Austin, features newly
demoed, white walled first floor space with up to
15,287 SF of availability and its own private entrance.
28
SOUTHWEST OFFICE BY THE NUMBERSSOUTHWEST OVERALL SUBMARKET PERFORMANCE
0%
2%
4%
6%
8%
10%
12%
14%
16%
$28.00
$29.00
$30.00
$31.00
$32.00
$33.00
$34.00
$35.00
$36.00
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Rent
al R
ate
Average Class A Full Service Rental Rate Direct & Sublease Vacancy Rate
0%
2%
4%
6%
8%
10%
12%
14%
-
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Avai
labi
lity
(SF)
Direct Available SF Sublease Available SF Direct & Sublease Vacancy Rate
AVAILABLE SF VS. VACANCY RATE
83%
84%
85%
86%
87%
88%
89%
90%
91%
92%
93%
(250,000)
(200,000)
(150,000)
(100,000)
(50,000)
-
50,000
100,000
150,000
200,000
250,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Occ
upan
cy R
ate
Abso
rptio
n (S
F)
Net Absorption* Direct & Sublease Occupancy Rate
NET ABSORPTION
VACANCY RATES VS. RENTAL RATES
Quarter Net Rentable Area Direct Available SF Net Absorption* Direct & Sublease Vacancy Rate
Average Class A Full Service Rental Rate
2013 Q3 9,568,412 722,668 (28,352) 8.06% $32.15
2013 Q4 9,382,293 734,638 (204,816) 8.42% $32.50
2014 Q1 9,382,293 703,789 (22,457) 8.66% $31.19
2014 Q2 9,382,293 853,812 (150,296) 10.26% $30.72
2014 Q3 9,458,793 653,880 164,619 9.24% $31.38
2014 Q4 9,418,793 640,998 42,081 8.41% $34.87
2015 Q1 9,446,430 589,875 66,172 7.98% $34.35
2015 Q2 10,109,725 1,070,609 182,561 12.21% $33.76
* Absorption includes sublease space. Numbers based on CBRE statistics.
292Q 2015 Austin Market Report
5.5
6.6
7.7
8.8
9.9
11.0
0%
5%
10%
15%
20%
25%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Mar
ket S
ize
(Mill
ions
of S
F)
Tota
l Vac
ancy
Rat
e (%
)
Market Size Historic Vacancy Rate AQUILA Model 1% Job Growth 3% Job Growth
3% Job Growth
1% Job Growth
Encino Trace I & II
SOUTHWEST SUBMARKET OFFICE RENTAL RATE PROJECTIONS
SOUTHWEST SUBMARKET OFFICE VACANCY RATE PROJECTIONS
$15
$20
$25
$30
$35
$40
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Full
Serv
ice
Rent
al R
ates
($)
Historic Rental Rate AQUILA Model 1% Job Growth 3% Job Growth
3% Job Growth
1% Job Growth
30
SOUTHWEST AUSTINLARGE OFFICE AVAILABILITY
Building Name Total Available Space Percent Subleasable
1 3700 San Clemente 154,602 SF -
2 CityView Center 43,819 SF 100%
3 The Park on Barton Creek 1 63,622 SF 100%
4 7500 Rialto 41,002 SF 88%
5 The Summit at Lantana 52,939 SF -
West Lake Hills
Bee cave
Barton Creek
SOU
THW
EST PKWY
1
2
3
4
5
312Q 2015 Austin Market Report
SOUTHWEST AUSTINOFFICE DEVELOPMENT
Building Total SF Percent Preleased Estimated Delivery Status
1 Encino Trace I 161,606 SF 100% 3Q 2015 Under Construction
2 Encino Trace II 158,137 SF 15% 3Q 2015 Under Construction
3 The Terrace 3 203,130 SF 0% - Planned
4 The Terrace 4 285,663 SF 0% - Planned
5 The Terrace 5 218,809 SF 0% - Planned
6 Lantana Ridge 175,000 SF 0% - Planned
7 Regency Park 90,000 SF 0% - Planned
Under Construction Planned
West Lake Hills
Bee cave
Barton Creek
SOU
THW
EST PKWY
1 2
3456
7
32
332Q 2015 Austin Market Report
THE APPENDIX
Long Term Performance of Submarkets 35
Long Term Performance: CBD vs. Suburban 36
Central Business District
Competitive Set Performance 37
Competitive Set Buildings 38
Northwest Submarket
Competitive Set Performance 39
Micromarket Performance 40
Micromarket Buildings 42
Southwest Submarket
Competitive Set Performance 45
Micromarket Performance 46
Micromarket Buildings 48
34
CITYWIDE AVAILABLE SF VS. VACANCY RATE CBD AVAILABLE SF VS. VACANCY RATE
0%
5%
10%
15%
20%
25%
30%
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
Dir
ect &
Sub
leas
e Va
canc
y Ra
te
Avai
labi
lity
(SF)
Citywide Direct Availability Citywide Sublease Availability
Citywide Vacancy Rate
0%
6%
12%
18%
24%
30%
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
Dir
ect &
Sub
leas
e Va
canc
y Ra
te
Avai
labi
lity
(SF)
CBD Direct Availability CBD Sublease Availability CBD Vacancy Rate Citywide Vacancy Rate
NORTHWEST AVAILABLE SF VS. VACANCY RATE SOUTHWEST AVAILABLE SF VS. VACANCY RATE
0%
4%
8%
12%
16%
20%
24%
28%
32%
36%
40%
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
5,000,000
Vaca
ncy
Rate
Avai
labi
lity
(SF)
Northwest Direct Availability Northwest Sublease Availability
Northwest Vacancy Rate Citywide Vacancy Rate
0%
7%
14%
21%
28%
35%
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
Vaca
ncy
Rate
Avai
labi
lity
(SF)
Southwest Direct Availability Southwest Sublease Availability
Southwest Vacancy Rate Citywide Vacancy Rate
LONG TERM PERFORMANCEOF SUBMARKETS
CITYWIDE AVERAGE CLASS A ASKING RATES ABSORPTION & OCCUPANCY RATE
$15.00
$20.00
$25.00
$30.00
$35.00
$40.00
$45.00
$50.00
Full
Serv
ice
Rent
al R
ate
CBD Northwest Southwest Citywide
65%
70%
75%
80%
85%
90%
95%
-2,000,000
-1,000,000
0
1,000,000
2,000,000
3,000,000
4,000,000
Dir
ect &
Sub
leas
e O
ccup
ancy
Rat
e
Year
Ove
r Yea
r Dir
ect &
Sub
leas
e Ab
sorp
tion
(SF)
CBD Northwest Southwest Citywide Occupancy Rate
*Absorption includes sublease space.
Numbers based on CBRE statistics.
352Q 2015 Austin Market Report
AVERAGE CLASS A ASKING RATES DIRECT & SUBLEASE VACANCY RATES
05
101520253035404550
Full
Serv
ice
Rent
al R
ate
CBD Suburban Citywide
0%
5%
10%
15%
20%
25%
30%
Dir
ect &
Sub
leas
e Va
canc
y Ra
te
CBD Vacancy Rate Suburban Vacancy Rate Citywide Vacancy Rate
DIRECT & SUBLEASE AVAILABILITY SF UNDER CONSTRUCTION
0%
5%
10%
15%
20%
25%
30%
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
Dir
ect &
Sub
leas
e Va
canc
y Ra
te
Dir
ect &
Sub
leas
e Av
aila
bilit
y (S
F)
CBD Suburban Citywide Vacancy Rate
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
Area
Und
er C
onst
ruct
ion
(SF)
CBD Northwest Southwest
LONG TERM PERFORMANCECBD VS. SUBURBANNumbers based on CBRE statistics.
36
CENTRAL BUSINESS DISTRICTCOMPETITIVE SET PERFORMANCE
AVAILABLE SF VS. VACANCY RATE
0%
2%
4%
6%
8%
10%
12%
14%
16%
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Avai
labi
lity
(SF)
Direct Available SF Sublease Available SF Direct & Sublease Vacancy Rate
NET ABSORPTION
86%
87%
88%
89%
90%
91%
92%
93%
94%
(100,000)
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2O
ccup
ancy
Rat
e
Abso
rptio
n (S
F)
Net Absorption* Direct & Sublease Occupancy Rate
VACANCY VS. RENTAL RATES
5%
7%
9%
11%
13%
15%
$43.00
$44.00
$45.00
$46.00
$47.00
$48.00
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Rent
al R
ate
Average Class A Full Service Rental Rate Direct & Sublease Vacancy Rate
CBD COMPETITIVE SET
Quarter Net Rentable Area
Direct Available SF
Sublease Available SF
Net Absorption*
Direct & Sublease Vacancy Rate
Avg. Class A Full Service Rental Rate
2013 Q3 5,639,134 690,990 17,977 (23,578) 12.57% $43.24
2013 Q4 5,636,079 690,237 17,977 (2,302) 12.57% $43.51
2014 Q1 5,637,136 618,961 4,210 86,100 11.05% $44.03
2014 Q2 5,637,136 576,465 25,189 21,517 10.67% $44.81
2014 Q3 5,827,916 483,868 81,356 227,210 9.70% $45.13
2014 Q4 5,827,916 503,540 69,160 (7,476) 9.83% $46.49
2015 Q1 6,344,401 421,858 55,200 612,127 7.52% $47.28
2015 Q2 6,466,952 479,092 40,409 80,108 8.03% $47.74
372Q 2015 Austin Market Report
Building Name Net Rentable Area
Direct Available SF
Sublease Available SF
Asking Rental Rate
Estimated OpEx
100 Congress 411,536 19,050 923 $35.00 $17.64
300 West 6th 454,225 6,494 0 $34.00 $18.42
301 Congress 418,338 73,352 0 $31.50 $17.95
400 West 15th 281,196 24,252 17,218 $24.50 $14.65
501 Congress 122,551 22,889 0 $32.00 $15.23
515 Congress 258,176 13,519 3,254 $32.00 $15.95
600 Congress Ave. 503,951 42,985 0 $33.00 $15.80
816 Congress 434,081 19,936 0 $27.50 $16.59
Austin Centre 326,335 17,780 5,520 $26.00 $15.88
Capitol Center 164,044 4,647 5,559 $26.00 $17.08
Capitol Tower 172,837 0 0 $27.00 $14.67
Chase Tower 389,503 0 0 $31.00 $17.90
Colorado Tower 373,334 5,948 0 $34.00 $14.49
Frost Bank Tower 535,078 26,607 0 $37.50 $19.25
IBC Bank Plaza 194,749 2,055 0 $30.00 $13.60
Lavaca Plaza 118,635 1,070 0 $29.50 $17.54
Littlefield Building 109,779 30,424 1,045 $29.00 $14.32
One Congress Plaza 518,385 72,848 6,060 $30.00 $16.69
San Jacinto Center 406,279 83,639 0 $32.00 $17.15
Scarbrough Building 130,789 11,597 830 $29.00 $12.75
Seaholm 143,151 0 0 $28.00 $12.00
CBD COMPETITIVE SET BUILDINGS
38
NORTHWEST SUBMARKETCOMPETITIVE SET PERFORMANCE
AVAILABLE SF VS. VACANCY RATE
0%
2%
4%
6%
8%
10%
12%
14%
16%
-
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Avai
labi
lity
(SF)
Direct Available SF Sublease Available SF Direct & Sublease Vacancy Rate
NET ABSORPTION
85%
86%
87%
88%
89%
90%
91%
92%
93%
94%
95%
96%
(200,000)
(100,000)
-
100,000
200,000
300,000
400,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Occ
upan
cy R
ate
Abso
rptio
n (S
F)
Net Absorption* Direct & Sublease Occupancy Rate
VACANCY VS. RENTAL RATES
0%
2%
4%
6%
8%
10%
12%
14%
$28.00
$29.00
$30.00
$31.00
$32.00
$33.00
$34.00
$35.00
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Rent
al R
ate
Average Class A Full Service Rental Rate Direct & Sublease Vacancy Rate
Quarter Net Rentable Area
Direct Available SF
Sublease Available SF
Net Absorption*
Direct & Sublease Vacancy Rate
Avg. Class A Full Service Rental Rate
2013 Q3 12,292,011 1,109,885 161,848 170,517 10.35% $30.12
2013 Q4 12,293,184 1,114,662 127,432 30,812 10.10% $30.54
2014 Q1 12,293,184 1,050,027 135,810 56,257 9.65% $31.21
2014 Q2 12,242,690 1,030,332 246,257 (141,246) 10.43% $31.61
2014 Q3 12,389,252 911,833 321,739 189,579 9.96% $32.12
2014 Q4 12,845,611 1,197,426 320,587 171,918 11.82% $32.93
2015 Q1 12,931,909 992,203 292,334 319,774 9.93% $33.39
2015 Q2 13,120,924 897,208 284,035 292,309 9.00% $33.83
NORTHWEST COMPETITIVE SET
*Absorption includes sublease space.
392Q 2015 Austin Market Report
ARBORETUM/DOMAINMICROMARKET PERFORMANCE
Quarter Net Rentable Area
Direct Available SF
Sublease Available SF
Net Absorption*
Direct & Sublease Vacancy Rate
Avg. Class A Full Service Rental Rate
2013 Q3 6,105,279 422,229 46,693 109,758 7.68% $31.41
2013 Q4 6,106,452 433,941 35,988 166 7.70% $32.00
2014 Q1 6,106,452 433,079 55,206 (18,356) 8.00% $32.55
2014 Q2 6,106,452 476,360 109,332 (97,407) 9.59% $33.04
2014 Q3 6,253,014 401,651 157,535 173,068 8.94% $33.66
2014 Q4 6,474,987 445,544 121,157 214,458 8.75% $34.38
2015 Q1 6,553,774 447,850 71,595 126,043 7.93% $34.46
2015 Q2 6,742,789 389,248 63,891 255,321 6.72% $34.77
ARBORETUM/DOMAIN COMPETITIVE SET
AVAILABLE SF VS. VACANCY RATE
0%
2%
4%
6%
8%
10%
12%
14%
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Avai
labi
lity
(SF)
Direct Available Sqft Sublease Available SF Direct & Sublease Vacancy Rate
NET ABSORPTION
86%
87%
88%
89%
90%
91%
92%
93%
94%
95%
(150,000)
(100,000)
(50,000)
-
50,000
100,000
150,000
200,000
250,000
300,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Occ
upan
cy R
ate
Abso
rptio
n (S
F)
Net Absorption* Direct & Sublease Occupancy Rate
VACANCY VS. RENTAL RATES
6.0%
6.5%
7.0%
7.5%
8.0%
8.5%
9.0%
9.5%
10.0%
$31.00
$31.50
$32.00
$32.50
$33.00
$33.50
$34.00
$34.50
$35.00
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Rent
al R
ate
Average Class A Full Service Rental Rate Direct & Sublease Vacancy Rate
*Absorption includes sublease space.
40
SHEPHERD MOUNTAIN/2222MICROMARKET PERFORMANCE
AVAILABLE SF VS. VACANCY RATE
0%
4%
8%
12%
16%
20%
24%
-
100,000
200,000
300,000
400,000
500,000
600,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Avai
labi
lity
(SF)
Direct Available Sqft Sublease Available SF Direct & Sublease Vacancy Rate
NET ABSORPTION
75%
77%
79%
81%
83%
85%
87%
89%
91%
93%
(40,000)
(20,000)
-
20,000
40,000
60,000
80,000
100,000
120,000
140,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2O
ccup
ancy
Rat
e
Abso
rptio
n (S
F)
Net Absorption* Direct & Sublease Occupancy Rate
VACANCY VS. RENTAL RATES
0%
3%
6%
9%
12%
15%
18%
21%
24%
$27.00
$28.00
$29.00
$30.00
$31.00
$32.00
$33.00
$34.00
$35.00
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Rent
al R
ate
Average Class A Full Service Rental Rate Direct & Sublease Vacancy Rate
SHEPHERD MOUNTAIN/2222 COMPETITIVE SET
Quarter Net Rentable Area
Direct Available SF
Sublease Available SF
Net Absorption*
Direct & Sublease Vacancy Rate
Avg. Class A Full Service Rental Rate
2013 Q3 2,453,857 271,916 40,399 41,015 12.73% $29.93
2013 Q4 2,453,857 274,295 40,399 (2,379) 12.82% $30.16
2014 Q1 2,453,857 276,447 29,559 8,688 12.47% $31.43
2014 Q2 2,453,857 241,923 46,956 17,127 11.77% $31.95
2014 Q3 2,453,857 211,437 92,007 (14,565) 12.37% $32.28
2014 Q4 2,688,442 389,788 127,233 21,008 19.23% $33.10
2015 Q1 2,690,750 207,238 179,538 132,553 14.37% $34.17
2015 Q2 2,690,750 181,807 152,245 52,724 12.41% $34.45*Absorption includes sublease space.
412Q 2015 Austin Market Report
FAR NORTHWESTMICROMARKET PERFORMANCEFAR NORTHWEST COMPETITIVE SET
AVAILABLE SF VS. VACANCY RATE
0%
3%
6%
9%
12%
15%
18%
-
100,000
200,000
300,000
400,000
500,000
600,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Avai
labi
lity
(SF)
Direct Available Sqft Sublease Available SF Direct & Sublease Vacancy Rate
NET ABSORPTION
85%
86%
87%
88%
89%
90%
91%
92%
93%
94%
(80,000)
(60,000)
(40,000)
(20,000)
-
20,000
40,000
60,000
80,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Occ
upan
cy R
ate
Abso
rptio
n (S
F)
Net Absorption* Direct & Sublease Occupancy Rate
VACANCY VS. RENTAL RATES
0%
2%
4%
6%
8%
10%
12%
14%
$26.00
$27.00
$28.00
$29.00
$30.00
$31.00
$32.00
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Rent
al R
ate
Average Class A Full Service Rental Rate Direct & Sublease Vacancy Rate
Quarter Net Rentable Area
Direct Available SF
Sublease Available SF
Net Absorption*
Direct & Sublease Vacancy Rate
Avg. Class A Full Service Rental Rate
2013 Q3 3,732,875 415,740 74,756 19,744 13.14% $28.14
2013 Q4 3,732,875 406,426 51,045 33,025 12.26% $28.41
2014 Q1 3,732,875 340,501 51,045 65,925 10.49% $28.88
2014 Q2 3,682,381 312,049 89,969 (60,966) 10.92% $29.02
2014 Q3 3,682,381 298,745 72,197 31,076 10.07% $29.40
2014 Q4 3,682,182 362,094 72,197 (63,548) 11.79% $30.26
2015 Q1 3,687,385 337,115 41,201 61,178 10.26% $30.93
2015 Q2 3,687,385 326,153 67,899 (15,736) 10.69% $31.66*Absorption includes sublease space.
42
ARBORETUM/DOMAIN MICROMARKET COMPETITIVE SET BUILDINGS
Building Name Net Rentable Area
Direct Available SF
Sublease Available SF
Asking Rental Rate
Estimated OpEx
Northland Office Bldg. 98,888 5,654 0 $16.50 $10.24
9500 Arboretum 182,331 0 18,319 $22.00 $13.00
Arboretum Atrium 90,280 2,515 0 $21.00 $14.27
Arboretum Plaza One 146,347 0 0 $26.00 $14.23
Arboretum Plaza Two 98,828 0 0 $26.00 $14.23
Arboretum Point 150,033 0 0 $23.00 $13.44
Atrium Office Centre 119,858 42,740 0 $17.50 $9.32
Austin Oaks (12 Bldg. Office Park) 445,240 17,423 2,215 $18.00 $10.90
Balcones Centre 74,876 3,919 0 $24.00 $9.86
Braker Pointe I 77,454 25,694 0 $21.00 $13.16
Braker Pointe II 103,114 0 17,112 $21.00 $12.89
Braker Pointe III 195,230 0 0 $24.00 $12.84
Campus @ Arboretum 1 60,059 11,590 0 $22.00 $13.78
Campus @ Arboretum 2 33,135 0 0 $22.00 $13.85
Campus @ Arboretum 3 32,765 0 0 $22.00 $14.53
Campus @ Arboretum 4 85,916 6,447 0 $22.00 $14.17
Campus @ Arboretum 5 105,000 5,585 0 $22.00 $14.12
Colina West 69,299 0 0 $19.75 $10.71
Domain 2 143,331 0 0 $30.00 $11.00
Domain 3 179,006 0 20,816 $25.50 $10.34
Domain 4 152,012 0 0 $24.00 $11.16
Domain 7 221,973 45,000 0 $27.00 $11.33
Domain Gateway 173,962 0 0 $21.00 $14.95
Great Hills Corporate Center I 56,200 1,689 0 $26.50 $10.95
Great Hills Corporate Center II 57,988 0 0 $26.50 $10.95
Great Hills Corporate Center III 85,061 16,044 0 $26.50 $10.95
Great Hills Plaza 139,252 16,006 0 $20.00 $11.23
Greystone Plaza 78,248 14,395 0 $27.50 $12.63
Heritage Plaza 74,736 9,209 0 $28.00 $11.29
Kaleido I & II 73,149 3,282 0 $25.00 $8.77
Lakeview Plaza 120,956 6,266 0 $20.00 $10.73
Northpoint Centre I & II 151,126 5,556 0 $22.00 $11.22
Offices at the Domain - Phase I 92,955 0 0 $26.50 $14.75
Offices at the Domain - Phase II 75,509 0 0 $26.50 $13.59
One Far West 70,642 1,753 0 $23.50 $12.92
Park North I & II 133,568 6,069 0 $18.00 $11.62
Plaza 7000 155,076 3,869 0 $23.50 $10.25
Prominent Pointe I 150,149 27,727 0 $24.50 $13.65
Prominent Pointe II 102,567 0 0 $24.50 $14.70
Quarry Lake Business Center 117,512 5,048 0 $20.00 $11.08
Quarry Oaks Atrium I 165,435 7,155 0 $24.00 $11.82
Quarry Oaks Atrium II 126,000 0 0 $25.00 $11.48
Reunion Park 118,142 14,631 0 $19.50 $11.16
Stone Creek I 76,860 0 0 $22.00 $0.00
Stone Creek II 162,723 6,687 0 $22.00 $12.60
Stone Creek Park 77,185 0 0 $20.00 $13.45
Stonebridge Plaza I 193,200 0 0 $26.00 $14.40
432Q 2015 Austin Market Report
Building Name Net Rentable Area
Direct Available SF
Sublease Available SF
Asking Rental Rate
Estimated OpEx
Stonebridge Plaza II 192,864 0 0 $26.00 $13.98
Stratum Exec Center - A 61,000 0 5,429 $20.00 $12.00
Stratum Exec Center - B 61,000 1,788 0 $20.00 $12.00
Stratum Exec Center - C 61,000 12,344 0 $20.00 $12.00
Stratum Exec Center - D 61,000 0 0 $20.00 $12.00
The Park at 8300 N. MoPac 93,317 6,911 0 $22.00 $13.40
UFCU Plaza 246,869 25,161 0 $20.00 $12.15
Westech 360 Bldgs. 1-4 175,529 26,044 0 $20.00 $11.93
Westpark Office 1-4 97,034 5,047 0 $28.00 $9.66
Building Name Net Rentable Area
Direct Available SF
Sublease Available SF
Asking Rental Rate
Estimated OpEx
Bridgepoint Square I 84,692 11,991 0 $23.00 $12.43
Bridgepoint Square II 92,459 16,391 0 $23.00 $12.43
Bridgepoint Square III 78,352 0 0 $23.00 $12.43
Bridgepoint Square IV 109,175 0 0 $23.00 $12.43
Bridgepoint Square V 76,793 3,220 0 $23.00 $12.43
Bridgepointe Plaza I 105,333 0 0 $23.00 $12.81
Bridgepointe Plaza II 72,640 6,617 0 $23.00 $12.81
Champion Office Park I & II 230,000 0 0 $26.50 $11.00
Four Points Centre I & II 192,396 0 0 $23.50 $12.62
Ladera Bend 1 56,466 0 0 $21.50 $16.34
Ladera Bend 2 45,732 2,900 0 $21.50 $13.88
Ladera Bend 3 56,196 0 56,196 $21.50 $13.83
Lakewood Center I 47,389 47,398 45,020 $20.00 $13.20
Lakewood Center II 44,611 0 13,206 $20.00 $13.20
Lakewood in the Park B 102,086 11,998 0 $19.50 $9.60
Lakewood in the Park C 78,596 0 0 $19.50 $11.80
Millennium Building 125,612 0 0 $22.00 $11.94
Park Centre Bldg.. 1 89,822 13,005 0 $18.00 $11.75
Park Centre Bldg.. 2 35,095 0 0 $18.00 $11.75
Park Centre Bldg.. 3 78,270 34,761 0 $18.00 $11.75
Reserve at Bull Creek A 43,782 7,622 0 $18.00 $12.28
Reserve at Bull Creek B 43,713 0 0 $20.00 $10.86
Reserve at Bull Creek C 43,695 0 0 $20.00 $11.44
River Place Corp. Park Bldg. 1 76,529 0 0 $21.00 $12.79
River Place Corp. Park Bldg. 2 114,491 9,987 0 $21.00 $12.43
River Place Corp. Park Bldg. 3 113,465 4,339 0 $21.00 $12.50
River Place Corp. Park Bldg. 4 87,639 0 0 $21.00 $13.53
River Place Corp. Park Bldg. 5 67,601 0 0 $21.00 $12.01
River Place Corp. Park Bldg. 6 62,037 0 0 $21.00 $13.33
River Place Corp. Park Bldg. 7 69,119 0 32,664 $21.00 $14.15
Shepherd Mountain Plaza 100,937 0 5,159 $33.00 $11.28
Stone Cliff 66,027 11,578 0 $18.00 $12.73
SHEPHERD MOUNTAIN/2222 MICROMARKET COMPETITIVE SET BUILDINGS
44
Building Name Net Rentable Area
Direct Available SF
Sublease Available SF
Asking Rental Rate
Estimated OpEx
Amber Oaks A 78,164 0 0 $19.00 $10.94
Amber Oaks B 44,184 0 0 $19.00 $8.30
Amber Oaks C 44,184 0 0 $19.00 $8.60
Amber Oaks D 28,733 0 0 $19.00 $10.45
Amber Oaks E 63,111 0 0 $19.00 $8.03
Amber Oaks F 78,034 78,034 0 $19.00 $10.09
Amber Oaks G 106,455 9,923 14,730 $19.00 $10.01
Amber Oaks H 101,045 0 0 $19.00 $10.93
Amber Oaks I 50,313 10,828 0 $19.00 $11.63
Amber Oaks J 50,111 6,245 33,147 $19.00 $10.90
Aspen Lake 204,940 0 0 $18.50 $13.26
Crossings at Lakeline I 114,726 4,078 0 $21.00 $10.98
Crossings at Lakeline II 117,548 10,645 0 $21.00 $11.10
Parmer Business Park A, B, C 123,731 0 0 $18.50 $5.60
Parmer Business Park D, E, F 107,283 0 0 $18.50 $5.60
Pecan Park I 136,444 4,603 0 $21.50 $10.69
Pecan Park II 136,245 0 0 $19.50 $9.45
Research Park Place 7 125,701 3,790 3,500 $22.00 $11.55
Research Park Place 8 125,700 33,518 0 $22.00 $11.55
Research Park Plaza I 136,068 15,962 0 $22.50 $13.96
Research Park Plaza II 135,813 0 0 $22.50 $13.96
Research Park Plaza III 173,530 0 0 $23.00 $13.08
Research Park Plaza IV 184,114 0 0 $23.00 $13.08
Riata Corporate Park Bldg. 2 63,372 16,821 0 $22.00 $12.33
Riata Corporate Park Bldg. 3 63,849 3,039 0 $22.00 $12.33
Riata Corporate Park Bldg. 4 93,737 93,737 0 $22.00 $12.33
Riata Corporate Park Bldg. 5 93,828 23,703 0 $22.00 $12.33
Riata Corporate Park Bldg. 6 93,835 0 0 $22.00 $12.33
Riata Corporate Park Bldg. 7 92,719 0 0 $22.00 $12.33
Riata Corporate Park Bldg. 8 93,718 0 16,522 $22.00 $12.33
Riata Corporate Park Bldg. 9 92,973 0 0 $22.00 $12.33
Riata Crossing Bldg. 1 81,775 0 0 $19.00 $8.00
Riata Crossing Bldg. 2 114,906 0 0 $19.00 $8.00
Riata Crossing Bldg. 3 81,229 0 0 $19.00 $8.00
Riata Crossing Bldg. 4 79,465 0 0 $19.00 $8.00
Tower of the Hills/Tower Point 175,802 11,227 0 $19.50 $12.60
FAR NORTHWEST MICROMARKET COMPETITIVE SET BUILDINGS
452Q 2015 Austin Market Report
SOUTHWESTCOMPETITIVE SET PERFORMANCESOUTHWEST COMPETITIVE SET
AVAILABLE SF VS. VACANCY RATE
0%
2%
4%
6%
8%
10%
12%
14%
16%
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Avai
labi
lity
(SF)
Direct Available SF Sublease Available SF Direct & Sublease Vacancy Rate
NET ABSORPTION
87%
88%
89%
90%
91%
92%
93%
94%
95%
96%
(200,000)
(100,000)
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Occ
upan
cy R
ate
Abso
rptio
n (S
F)
Net Absorption* Direct & Sublease Occupancy Rate
VACANCY VS. RENTAL RATES
5%
6%
7%
8%
9%
10%
$33.00
$34.00
$35.00
$36.00
$37.00
$38.00
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Rent
al R
ate
Average Class A Full Service Rental Rate Direct & Sublease Vacancy Rate
Quarter Net Rentable Area
Direct Available SF
Sublease Available SF
Net Absorption*
Direct & Sublease Vacancy Rate
Avg. Class A Full Service Rental Rate
2013 Q3 7,108,521 609,436 91,892 (47,365) 9.87% $33.51
2013 Q4 7,108,930 552,899 97,634 51,204 9.15% $33.82
2014 Q1 7,102,874 480,177 202,095 (37,795) 9.61% $34.71
2014 Q2 7,102,874 387,913 208,978 85,381 8.40% $35.06
2014 Q3 7,102,874 294,587 169,604 132,700 6.54% $35.47
2014 Q4 7,102,547 386,333 182,477 (104,946) 8.01% $36.07
2015 Q1 7,100,750 399,919 188,613 (21,519) 8.29% $36.98
2015 Q2 7,782,464 428,605 213,812 627,829 8.25% $37.55*Absorption includes sublease space.
46
NEAR SOUTHWESTMICROMARKET PERFORMANCE
AVAILABLE SF VS. VACANCY RATE
0%
2%
4%
6%
8%
10%
12%
14%
16%
-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Avai
labi
lity
(SF)
Direct Available SF Sublease Available SF Direct & Sublease Vacancy Rate
NET ABSORPTION
85%
86%
87%
88%
89%
90%
91%
92%
93%
94%
(150,000)
(100,000)
(50,000)
-
50,000
100,000
150,000
200,000
250,000
300,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Occ
upan
cy R
ate
Abso
rptio
n (S
F)
Net Absorption* Direct & Sublease Occupancy Rate
VACANCY VS. RENTAL RATES
5%
7%
9%
11%
13%
15%
17%
$34.00
$35.00
$36.00
$37.00
$38.00
$39.00
$40.00
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Rent
al R
ate
Average Class A Full Service Rental Rate Direct & Sublease Vacancy Rate
NEAR SOUTHWEST COMPETITIVE SET
Quarter Net Rentable Area
Direct Available SF
Sublease Available SF
Net Absorption*
Direct & Sublease Vacancy Rate
Avg. Class A Full Service Rental Rate
2013 Q3 2,718,247 252,847 30,712 22,236 10.43% $35.83
2013 Q4 2,718,656 228,673 41,301 13,994 9.93% $35.99
2014 Q1 2,712,851 209,356 143,888 (89,075) 13.02% $37.18
2014 Q2 2,712,851 191,624 165,931 (4,311) 13.18% $37.40
2014 Q3 2,712,851 174,207 126,557 56,791 11.09% $37.59
2014 Q4 2,713,137 158,703 124,248 18,099 10.43% $38.03
2015 Q1 2,711,340 143,863 125,110 12,181 9.92% $39.26
2015 Q2 2,925,937 110,815 101,710 271,045 7.26% $39.49*Absorption includes sublease space.
472Q 2015 Austin Market Report
FAR SOUTHWESTMICROMARKET PERFORMANCEFAR SOUTHWEST COMPETITIVE SET
AVAILABLE SF VS. VACANCY RATE
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
500,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Avai
labi
lity
(SF)
Direct Available SF Sublease Available SF Direct & Sublease Vacancy Rate
NET ABSORPTION
88%
90%
92%
94%
96%
98%
100%
(200,000)
(100,000)
-
100,000
200,000
300,000
400,000
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Occ
upan
cy R
ate
Abso
rptio
n (S
F)
Net Absorption* Direct & Sublease Occupancy Rate
VACANCY VS. RENTAL RATES
0%
2%
4%
6%
8%
10%
12%
14%
16%
$29.00
$30.00
$31.00
$32.00
$33.00
$34.00
$35.00
$36.00
$37.00
2013 Q3 2013 Q4 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2
Vaca
ncy
Rate
Rent
al R
ate
Average Class A Full Service Rental Rate Direct & Sublease Vacancy Rate
Quarter Net Rentable Area
Direct Available SF
Sublease Available SF
Net Absorption*
Direct & Sublease Vacancy Rate
Avg. Class A Full Service Rental Rate
2013 Q3 4,390,274 356,589 61,180 (69,601) 9.52% $32.07
2013 Q4 4,390,274 324,226 56,333 37,210 8.67% $32.48
2014 Q1 4,390,023 270,821 58,207 51,280 7.49% $33.19
2014 Q2 4,390,023 196,289 43,047 89,692 5.45% $33.62
2014 Q3 4,390,023 120,380 43,047 75,909 3.72% $34.16
2014 Q4 4,389,410 227,630 58,229 (123,045) 6.51% $34.86
2015 Q1 4,389,410 256,056 63,503 (33,700) 7.28% $35.57
2015 Q2 4,856,527 317,790 112,102 356,784 8.85% $36.39*Absorption includes sublease space.
48
NEAR SOUTHWEST MICROMARKET COMPETITIVE SET BUILDINGS
Building Name Net Rentable Area
Direct Available SF
Sublease Available SF
Asking Rental Rate
Estimated OpEx
Barton Creek Plaza I 72,974 24,336 0 $22.00 $12.53
Barton Creek Plaza II 64,718 2,688 0 $22.00 $11.69
Barton Creek Plaza III 64,842 6,413 0 $22.00 $11.83
Barton Oaks Plaza I 99,404 0 0 $26.00 $14.68
Barton Oaks Plaza II 116,368 11,073 0 $26.00 $14.37
Barton Oaks Plaza III 121,467 2,400 3,303 $26.00 $13.41
Barton Oaks Plaza IV 112,000 0 0 $40.00 $13.86
Barton Oaks Plaza V 119,549 5,562 4,189 $26.00 $13.80
Barton Skyway I 195,324 3,596 3,596 $25.50 $13.40
Barton Skyway II 195,639 5,639 0 $25.50 $13.79
Barton Skyway III 173,302 2,716 0 $25.50 $13.70
Barton Skyway IV 222,580 0 0 $25.50 $12.86
Centre I 39,903 1,479 0 $18.00 $12.00
Centre II 54,610 4,999 0 $19.50 $11.82
Mira Vista 121,147 0 0 $27.00 $14.09
Overlook at Gaines Ranch 50,725 0 0 $26.50 $14.17
Rollingwood Center I & II 214,587 7,878 8,000 $28.00 $12.00
Spyglass Point 58,576 0 0 $21.00 $13.45
The Park on Barton Creek 1 102,608 0 63,622 $24.50 $13.33
The Park on Barton Creek 2 102,587 0 0 $24.50 $13.33
The Terrace 1 115,460 6,354 0 $23.50 $14.90
The Terrace 2 114,635 3,232 0 $23.50 $15.03
The Terrace 6 196,717 22,450 0 $26.50 $15.62
The Terrace 7 196,215 0 19,000 $26.50 $15.59
492Q 2015 Austin Market Report
FAR SOUTHWEST MICROMARKET COMPETITIVE SET BUILDINGS
Building Name Net Rentable Area
Direct Available SF
Sublease Available SF
Asking Rental Rate
Estimated OpEx
3700 San Clemente 249,870 154,602 0 $29.00 $11.50
3900 San Clemente 251,146 0 0 $25.00 $13.93
5000 Plaza on the Lake 118,063 1,086 9,980 $26.00 $14.57
7000 West at Lantana 1 & 2 136,075 0 0 $24.50 $12.13
Canyon at Wild Basin 74,580 9,755 1,283 $23.00 $11.60
Capital Ridge 216,511 0 0 $30.00 $10.56
Cielo Center 270,711 5,353 3,371 $19.50 $12.55
CityView 1 46,702 2,301 0 $20.50 $10.55
CityView 2 47,809 0 0 $20.50 $10.55
CityView 3 48,044 6,629 0 $20.50 $10.55
CityView Center 137,763 0 43,819 $24.00 $11.79
Crystal Mountain 1, 2 & 3 56,507 10,112 1,590 $26.00 $9.41
Dimensional Place I 220,000 0 0 $24.00 $12.42
Dimensional Place II 156,000 0 0 $24.00 $12.42
Escalade Bldg. A 56,701 9,440 0 $19.00 $11.92
Escalade Bldg. B 56,701 12,428 0 $19.00 $11.92
Lake Pointe Center 2 42,933 2,840 0 $27.00 $7.71
Las Cimas I 85,000 3,700 0 $24.50 $14.18
Las Cimas II 156,069 0 2,947 $26.00 $13.83
Las Cimas III 157,418 0 3,718 $26.00 $13.93
Las Cimas IV 138,008 0 2,587 $26.50 $14.47
Lost Creek Point 73,026 5,308 0 $29.00 $12.37
Parkway at Oak Hill I & II 145,475 1,779 0 $23.50 $13.07
Plaza 290 63,163 2,192 4,002 $17.50 $10.81
Plaza on the Lake I 122,530 8,936 0 $25.50 $13.84
Plaza on the Lake II 111,166 0 0 $25.50 $14.96
Rialto I 77,872 2,220 0 $22.00 $11.63
Rialto II 77,508 4,581 36,421 $22.00 $11.63
San Clemente Bldg. B 90,267 0 0 $26.50 $14.05
The Enclave 44,704 0 0 $17.00 $8.37
The Summit 1-5 (formerly AMD campus) 865,832 52,939 0 $25.00 $11.84
Travis Oaks 123,434 3,373 2,384 $22.50 $12.09
Vista Ridge I 75,131 11,837 0 $17.50 $11.33
Westlake Place 61,184 6,379 0 $20.00 $10.50
Wild Basin Atrium Park A 67,500 0 0 $16.50 $9.31
Wild Basin I 60,498 0 0 $19.00 $11.40
Wild Basin II 74,626 0 0 $19.00 $11.37
50
Step 1: Lease data was collected in the Austin suburban markets for buildings
constructed near new developments from 2002 to 2013. This yielded 42
developments to analyze.
Step 2: The developments were plotted on a map. For each new development, a fixed
radius was drawn so that all existing buildings within this ring at the time of the
development were identified for analysis.
Step 3: Starting rental rates were tracked on a quarterly basis for each of the marked
existing properties. Using the delivery of the new development as time “0,” the
tracked starting rental rates were assigned a time relative to the delivery date
(i.e. “-4” would represent the starting rental rate 4 quarters prior to delivery).
Step 4: The tracked rental rates in Step 3 were compared to the average starting rental
rates throughout Austin at the same relative time to each of the new building
deliveries. The differences of these 2 geographies were the metric used in the
study. For example, if the average starting rental rate at the time “-4” near the
new development was $30/sf and the average starting rental rate in Austin was
$28/sf at that time, then the rate above the average Austin rate was $2/sf. This
methodology normalizes the data to account for economic forces that occur
over time.
Step 5: This process was repeated for all 42 tracked buildings, and the differences
between the starting rates for the buildings close to new developments and the
overall Austin market were averaged together for each time period. The results
are displayed in the graph.
HOW DO NEW OFFICE DEVELOPMENTS AFFECT SURROUNDING RENTAL RATES?METHODOLOGYThe following methodology was used to derive the data featured in the special report on page 10 of this publication.
512Q 2015 Austin Market Report
YOURNOTES:
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