January 27, 2017
During the first week of January 2017, the Federal Reserve Bank of Dallas predicted a slowdown in the Austin economy. According to NAI Partners’ Q4 2016 Austin Office Market Report, that slowdown, especially in the office sector, had begun as far back as Q3 2016.
“Starting in the third quarter of this past year, leasing activity began to slow, and this trend continued through the end of 2016,” the report noted. Though January began with increased activity, the NAI Partners’ analysts are predicting that things will cool down once again. Building sales are slowing as well.
Breaking out the numbers, net absorption in Q4 was 187,309 square feet, down considerably from the year before. Vacancy was 9.2%, with construction at 3.1 million square feet. David Dawkins, managing vice president with NAI Partners’ Austin office, indicated that it’s time for the activity to level off, “especially since demand has continued to outpace supply.”
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