Office Space News
Empty Office Space Abounds in Austin, Round Rock
Published July 5th, 2010 by Jennifer LeClaire
Austin and its growing Round Rock suburb are far from immune to office space woes. The vacancy rate for the Austin-Round Rock metropolitan statistical area dipped for the first time in three years during the first quarter of 2010. So says new figures from Oxford Commercial, a local commercial real estate firm.
The report offers some interesting insights. The area’s overall vacancy rate is 22.1 percent. And the majority of Austin’s suburb office markets are holding steady at around 7 percent vacancy. But when it comes to office buildings larger than 10,000 square feet, Round Rock is in the struggler’s spotlight with a whopping 52 percent vacancy rate.
That appears to be a sad statement for what was for so long a booming economy. But it may not be as bad as it looks. Part of the problem is the timing of new office space that came online. Frontera Vista, for example, opened the doors to two five-story towers in 2009 and they sitting near empty. That’s skewing the numbers for the Round Rock office market because its 268,000 square feet accounts for nearly half of the city’s available office space.
So what’s going on in the executive office suites industry in the Austin-Round Rock area? Here are some of the players in and around Austin:
- Executive Office Terrace
- Northwest Executive Suites
- Foxglove Executive Suites
- Businessuites
- Pflugerville Executive Office Suites
- Wind River Executive Suites
- Intelligent Office
- AustinSuites
- HQ
- Overlook Executive Suites
- Regus
- Hills Executive Suites
- Spicewood Professional Offices
As I examined the serviced office landscape around Austin, I noticed these cities have a higher than average share of executive suites brands that are not nationally recognized. While all the usual suspects are serving the market (read: Regus, Intelligent Office and Businessuites), there are what appear to be a good number of single-facility business center operators in the area. In fact, there were so many it became tedious to list them all.
What this signals to me is a competitive environment for office space in Austin, Round Rock, Pflugerville and other suburbs in the region. So if you are looking for office space in these southwestern cities, you should be able to negotiate an attractive deal with serviced office operators.
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Bill Brookshire July 5th, 2010 at 10:12 am
Nice report. Round Rock is a great place to do business. Office space is cheaper than in Austin, but it’s so close that you don’t miss out on Austin opportunities. I think you are right… you can’t judge Round Rock’s office space success by those numbers alone because of that new project. I think that’s the case in many office markets across the country. New office space makes a major impact on vacancy rates.
Elizabeth Sanchez July 5th, 2010 at 10:32 am
It’s still a renter’s market when it comes to office space in most cities. You just have to understand where the deals are. Executive office suites are especially good deals because you don’t have to sign a long-term lease. Even with attractive office lease rates, some companies may still be gun shy about locking in a deal. Round Rock and Austin office markets will recover, no doubt. These are vibrant cities.