September 8th, 2023 News Brief TLDR:

1. $164M Austin airport expansion kicks off, led by Hensel Phelps. 🛫

2. St. John's 120K sq ft Class A office breaks ground in Austin. 🏢

3. $23.5M in bonds awarded for Juniper Creek's affordable housing by TSAHC. 🏠

4. Oracle plans massive Southeast Austin campus expansion. 🌆

HOUSING & REAL ESTATE DEVELOPMENT

1.2 million new apartment units: That’s the number of new rentals that opened in the United States during the last three years

Source: Rejournals.com

Summary: In the last three years, the United States has seen the construction of 1.2 million new apartment units, a multifamily construction surge not witnessed since the 1970s. This growth is slated to continue until 2025, with professionals cautioning that economic uncertainties will subsequently slow the pace. Almost two-thirds of the newest constructions are condensed in 20 high-growth metropolitan regions, representing about 41% of the renter population in the country. A significant percentage, about 89% of the apartments fashioned during this time, are high-end, bearing expense equatable to upper-middle-class and high-income renters. Austin, in particular, has experienced the highest construction volume in the past three years.

Why this matters: Given that Austin has been the major lowercase in new apartment construction over the years, real estate professionals practicing in this area stand to benefit substantially from arming themselves with this information to spot trends in regional growth and earn a strategic edge when noseying prosperous investment opportunities.

Texas State Affordable Housing Corporation Awards $23.5 Million in Private Activity Bonds to Foundation Communities to Finance Juniper Creek Apartments

Source: Globenewswire.com

Summary: The Texas State Affordable Housing Corporation (TSAHC) has awarded $23.5 million in bonds to the Foundation Communities to finance the development and construction of Juniper Creek, a new affordable housing development project. The upgraded environment will consist of 110 units specifically for low-income households, with a considerable proportion (25%) held aside for those experiencing homelessness or living close to, or under, 30% of the area's median family income. Funding approved includes housing tax credits, an AHP grant, and involvement from major financers such as Wells Fargo, Travis County, and Austin Finance Corporation. The location is primed for convenient access to public transit, mixed-use communities, commercial buildings, retail establishment, and educational features, punctuated by adjacent proposed childcare and learning center.

Why this matters: Expected addition of affordable housing in the north central Austin area and significant infusion of capital could boost indirect commercial real estate opportunities such as rental potential or increased commercial demands in nearby regions, areas relevant for commercial real estate professionals.

Cadence McShane Construction Successfully Completes Scottsdale Crossing E & F, Two State-of-the-Art Industrial Buildings in Cedar Park

Source: PRWeb.com

Summary: Cadence McShane Construction has successfully completed the Scottsdale Crossing E & F project, a pair of modern industrial buildings, in Cedar Park, Texas, in partnership with TIG Real Estate Services. The state-of-the-art industrial buildings offer improved facilities and infrastructure, with an appealing cold dark shell design, playing a role in enhancing both the industrial landscape and the local economy of Cedar Park.

Why this matters: The formation of promising real estate developments like the Scottsdale Crossing E & F project highlights the dynamic and thriving market conditions in Central Texas, providing commercial real estate professionals with potential investment opportunities for their clients seeking modern infrastructure in the booming industrial sector.

Meet the pro-housing agitators who are fighting to bring down home prices — and winning

Source: BusinessInsider.com

Summary: The "Yes In My Backyard," or YIMBY movement supports housing abundance and aims to alleviate the US housing crisis by simplifying the development process, an act that can help to lower some of the current skyrocketing home prices. This movement has gathered momentum in many US states, leveraging bipartisan interest around affordability and adjusting the traditional perceptions of housing development towards a more proactive and widely supported cause of housing abundance. The local organizing tactics aimed at maximizing home construction are slowly replacing traditionally supplied-based regulations. Many cities, originated in California state, have passed upzoning measures that have even ended single-family zoning, shifted the focus onto multi-family housing structures, and instigated renovations, reforms, and eased regulations making house construction easier and more prevalent. The US housing proponent group, YIMBY Law, implies that extensive work and progress continues around the housing situation in many affected states.

Why this matters: This shift in perspective towards housing openness will play a critical role in shaping the commercial property landscape in Central Texas - from scarcity to creating abundance - aiding commercial realtors and estate companies in incorporating it in their key strategies for land usefulness, intense infrastructure progress, adjustable laws, and active client interaction within real measurable results.

Southeast Austin’s Oracle Campus Planning Office and Hotel Addition

Source: AustinTowers.net

Summary: Oracle's headquarters in Southeast Austin is eyeing another expansion, if recent city permits are anything to go by. Launched on South Lakeshore Boulevard in 2018, the current campus spans roughly 50 acres on Lady Bird Lake's southeast shore. Oracle is now prepping for a proposed amendment of the Planned Unit Development (PUD) agreement with the City of Austin, intending to add a 2.34-acre property currently housing the Town Lake Village Condos, purchased and slated for demolition by the tech giant earlier. The new motel and 287,000-square-foot office addition protests to lead an even larger plan for Oracle property expansion in the region. Any specifics about the project, however, remain unclear and under review.

Why this matters: Considering Oracle's impending expansion, commercial real estate professionals in Central Texas can expect a rise in interest and demand for nearby properties, fueling property values and investment opportunities.

INFRASTRUCTURE & TRANSIT PROJECTS

Hensel Phelps starts $164M Austin airport gate expansion

Source: ConstructionDive.com

Summary: Construction work has begun on the $164M West Gate Expansion of the Austin-Bergstrom International Airport. Led by Hensel Phelps out of Greeley, Colorado, the project will add 84,500 square feet distributed over three new levels. The facility will feature new seating areas, larger restrooms, relaxation spaces, nursing areas, and an outdoor public space showcasing city views. The airport developments form part of ambitious plans for fully sixty-one proposed facility improvements scheduled for the next two decades, culminating with an official project opening slated for 2026.

Why this matters: The extensive expansion and modernization plans for Austin's main airport underscore a commitment to encourage high economic growth in the area. Commercial real estate pros in Austin could see a boost in business interest and potential new clients in connection to this project, owing to prospective increases in both business and leisure travel to Austin which usually escalates the need for more commercial space.

Matthew Tucker to Lead HDR’s Global Transit Program Matthew Tucker, former CEO of the North County

Source: InformedInfranstructure.net

Summary: Transit District, has joined HDR as the company's Global Transit Director. In his new role, he will oversee the growth of HDR's global transit program, guiding the vision and direction of all transit-based initiatives. This includes expanding HDR's advisory and technical prowess across a portfolio handling diverse transit systems worldwide. Moreover, HDR also assists transit clients in navigating funding, managing program development, and supervising design complicated construction management.

Why this matters: New construction and development projects signal impending shifts in real estate markets; hence Tucker’s appointment at HDR, overlapped with the company’s involvement in Austin's Project Connect, emphasizes the potential for expanded commercial real estate opportunities connected to transit developments in the Austin area.

Real Estate Market Trends & Investment

City real estate a leader in climate change resiliency: report Austin, amongst other

Source: Winnipegfreepass.com

Summary: North American cities, was recognized in a CBRE report for leading climate change resiliency in the real estate markets. This recognition is based on a study of a broad range of factors including cities' emission reduction targets, risk to climate change, and proportion of green building stock. The report highlights that cities working proactively toward climate resiliency will likely be the attractive potential for investors and tenants planning to meet their own sustainability goals, thereby safeguarding their property values. Also, the transition to a low carbon future was predicted to primarily mold future real estate considerations, accounting for new permissible guidelines.

Why this matters: Austin's recognition as a leader in climate change resilient real estate drives demand within the investor and tenant communities, allowing Central Texas commercial real estate professionals to leverage this sustainable development standpoint to amplify the appeal of their portfolios to clients adopting active sustainability objectives.

Brandywine Realty Trust Announces Capital Transactions Totaling $103.3 million and signs

Source: GlobeNewsWire.com

Summary: First Commercial Lease at 3025 JFK Blvd in Schuylkill Yards Brandywine Realty Trust has sold its property, Three Barton Skyway in Austin, Texas for $53.3 million. The office building measures 173,302 square feet. The Trust has also announced the closing of a construction loan on one of their development projects. This follows on a signed lease agreement with global law firm Goodwin at a different location (Schuylkill Yards).

Why this matters: The sale of the premier, Austin-based property Three Barton Skyway gives estate professionals insights into the contemporary commercial real market values in Austin, opening up possibilities for similar sales and purchases within this market.

TODAYS PERMIT RUNDOWN

Hold on to your hard hats, folks! We have some thrilling construction developments underway in the heart of Central Texas! Here are the essential details on the construction industry's highest-profile projects that have just been given the green light. At the top of our list is a whopping $3M renovation of the Austin ENTC medical office building by Bryan Manfull.

All eyes on floor three as MOD:Architecture is at the steering wheel, promising an impressive overhaul that healthcare workers and patients alike will benefit from.

Next up, is an exciting new construction at EquipmentShare in Creedmoor. With an estimated cost of $1.2M, we are anticipating a state-of-the-art construction equipment rental facility complete with customer parking and equipment laydown yard. With a name like EquipmentShare.com Inc on the deed and pb2 architecture + engineering drafting the blueprints, we can't wait to see how this project will shape up!

Crown Castle is injecting a breath of fresh air into Cedar Park with a $435K renovation of the suite located at 12112 Anderson Mill Rd. Abel Design Group is spearheading the project for owner Aadhya Investments. Aside from the existing restroom and breakroom overhaul, revamping the suite is also on the docket.

The recently announced ERA Brokers Austin Corp. Headquarters is also making waves! At Trio Building 1, a renovation valued at $325K is in the pipeline that features a slick, modern office space. Thanks to the ingenuity of NEWTON Architecture and KC-5 Dittmar, LLP, we're anticipating a beautiful fusion of design and functionality.

Over in Rollingwood, Emory Oak Partners are transforming an existing suite within the facility owned by Lore ATX Rollingwood LLC. Led by the stalwarts of Abel Design Group, this $400K renovation promises a revamped, elegant space that will surely put the address - 2500 Bee Cave Rd Suite 390 - on the map!

The Lamar Central site will soon host a brand-new chiropractic facility, courtesy of a significant $310K investment by Highland Resources, Inc. Lasky Architect PA is tasked with developing this health-promoting addition to Austin's Rosedale neighborhood.

And finally, a nod to the $75K alterations underway at the Balcones Woods Shopping Center. Supervised by Revel Architecture & Design, these tenant improvements for Balcones-Wilshire LLC will include everything from modest demolition to new partitions, ceiling tile, finishes, and upgrades in mechanical, electrical, and plumbing.

That's the round-up for today, folks! Ensure to keep your eyes on these exciting developments in the days to come.