Austin Office Pipeline Pushes Through a Vacancy Hangover

Development Remains Active

The Commercial Property Executive reports that Austin’s office pipeline stayed strong into 2026, with nearly 977 KSF under construction, representing 1% of total inventory. This outpaces both the national average and peer markets like Atlanta, Phoenix, and Dallas. Projects in planning lift Austin’s share to 2.9% of stock, trailing only Boston nationally. Notable projects include Apple’s campus expansion and the Waterline — a 74-story mixed-use tower adding 2.7M SF.

Muted Transactions and Investment

Office investment activity in Austin started the year slow, with deals totaling under $50M through February. 2025 saw $628M in sales, trailing major peer cities in volume, though pricing held firm at $216 PSF. The acquisition of Cielo Center highlighted limited but notable transaction activity in the metro.

Vacancy and Leasing Trends

Despite a 290-basis-point year-over-year improvement, Austin’s office vacancy was 24.6% as of February, second highest nationally, as other Sun Belt markets also face slowing momentum and rising vacancy after earlier expansion cycles. Average asking rent reached $46.38 PSF, maintaining a premium over the $32.79 US index and higher than most comparable markets in the South.

Flex and Coworking Growth

Austin’s flex office footprint hit 2M SF, or 2% of the office market, with coworking space expanding across 108 locations. Top providers include WeWork, Industrious, and Regus. While still smaller than Dallas or Phoenix, Austin’s coworking inventory is growing steadily and now exceeds that of Charlotte and Orlando.