Weekend Roundup: 🚫 Park No More, Austin! City Walks Away from Parking Minimums 🚗

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Here’s what you need to know about CenTex CRE Today:

1. Austin nixes parking minimums, paving the way for a walkable future. 🚶

2. Georgetown, Kyle, Leander: Texas' trio leading the U.S. suburban growth spurt. 🏡

3. Retail rent rally: Central Texas outpaces state with 5% growth. 📈

4. Office market shuffle: Austin sees demand shift in Q3's square footage saga. 🏗️

Urban Planning and Policy Changes

Austin becomes largest city in the U.S. to dump parking requirements

Source: The Texas Tribune

Summary: Austin has become the largest US city to eliminate minimum parking requirements for all types of new developments, including commercial properties, in an effort to combat climate change and encourage more housing construction. The decision is in sync with the city's plan to invest heavily in its public transit system, aligning with a growing trend among major US cities including Portland, Minneapolis, and San Jose.

Why this matters: This policy change could potentially reduce the cost of commercial development in Austin, allowing real estate professionals to offer more competitive pricing to their clients and capitalize on the increased demand for environmentally friendly commercial spaces.

Real Estate Development and Market Trends

Central Texas Leads the State for Retail Rent Growth

Source: CoStar.com

Summary: San Antonio and Austin lead the state of Texas in year-over-year rent growth for retail markets, with both markets observing a growth rate over 5% between October 2022 and October 2023, making them the third- and fourth-largest retail markets in the state.

Why this matters: This data presents a positive growth indicator for commercial real estate professionals serving in Central Texas, as it suggests potential increased investment and returns in retail properties in the Austin and San Antonio areas.

These 3 Austin neighbors are the fastest-growing suburbs in the U.S., report finds

Source: Austin Culture Map

Summary: Georgetown, Kyle, and Leander rank as the fastest-growing affordable suburbs in the U.S., with growth rates of 26.7%, 23.7%, and 22.2% respectively since 2020. Georgetown leads with an average housing price of $453,376, which is higher than Williamson County's median home price of $426,752. Kyle, having the lowest average housing price among the three Austin suburbs at $336,615, is deemed the 'most happenin' suburb' due to its proximity to Austin. Leander, despite its phenomenal growth and upcoming projects, remains affordable with average home prices around $450,798. Texas dominates the list with nine out of the top 20 fastest-growing affordable suburbs.

Why this matters: Understanding these growth trends can guide commercial real estate professionals in targeting investments and advising clients seeking potential opportunities in these rapidly expanding suburbs.

Q3 2023 | Austin Office Market Report

Source: Austin Culture Map

Summary: Austin's commercial real estate market has been challenged with negative net absorption for the third consecutive quarter, offsetting gains from previous years. Vacancy rates are on the rise due to factors such as lease expirations and new subleases entering the market, pushing total availability to nearly 23% of existing supply. Notably, Indeed consolidated its market footprint by vacating a building at Domain Gateway. The quarter saw no new ground-breaking, but two projects were finished. Despite some setbacks, there are signs of improvement in Austin's office investment sales market, with transactions taking place. Office spaces ranging from 1,000 to 10,000 square feet have seen increased demand, reflecting changing work patterns and economic uncertainties.

Why this matters: Understanding the current challenges and trends in Austin's commercial real estate market, such as the increasing demand for smaller office spaces and the rising vacancy rates, can help professionals better strategize and navigate their investments and advise their clients efficiently.