Austin Office Market
Annual full-service rental rates increased to a new high of $46.27/SF, reflecting quarterly and annual increases of 2.2% and 5.3%, respectively. Overall vacancy dropped by 120 basis points quarter over quarter and year over year from a record high of 23.5% to high of 22.3% as the market has begun to work through the surge of deliveries that have occurred in recent years. The under-construction pipeline ticked upward, ending the quarter with 191,850 SF under construction as restrictive fiscal policies and rising building costs have curtailed new office groundbreakings. Quarterly leasing activity slowed to 1.5 MSF when compared to the first quarter of 2025 and remains below the 16-year first-quarter average of 2.1 MSF as corporations slow decisions to evaluate the impacts of artificial intelligence and macroeconomic uncertainty on space utilization.
Download Austin Office Market Report 1Q26
Austin Industrial Market
The market recorded 444,293 SF of positive absorption in the fourth quarter of 2025, marking the 26th consecutive quarter of positive absorption. Overall rental rates decreased by 2.4% quarter over quarter to $14.45/SF, reflecting a decline of 3.2% from the historic high achieved during the first quarter of 2024. The construction pipeline delivered 2.0 MSF during the fourth quarter of 2025. The under-construction pipeline continues to be elevated at 12.3 MSF, despite decreasing by 8.3% quarter over quarter. After three consecutive years of new deliveries outpacing annual demand, the imbalance persisted through year-end. Through the end of 2025, developers completed 8.9 MSF of new space versus 3.0 MSF of net absorption, creating a 5.9 MSF demand deficit that has driven the vacancy rate up by 320 basis points year over year to a record high of 15.1%.
Download Austin Industrial Market Report 4Q25