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Market Report

Austin Industrial Market Report

2023 Investment Forecast

Corporate Move-Ins and In-Migration Position Austin for Long-Term
Industrial Growth Amid Vacancy Correction

Elevated arrivals lift availability in the near term. Net in-migration to Austin will remain strong throughout 2023, as the metro’s skilled labor pool expands alongside corporate move-ins. The resulting population growth is expected to fuel home and necessity goods purchasing, despite worries of anticipated discretionary spending pullbacks. This dynamic is poised to foster industrial leasing commitments by consumer goods suppliers, such as Four Hands, translating to strong demand for warehouse and manufacturing space this year. Limited space options relative to other Texas markets, however, may support demand for high-quality floorplans at a time when Austin’s industrial pipeline remains historically elevated. While upcoming completions will place some pressure on near-term vacancy — adjusting the rate upward from record lows achieved in 2021 and early 2022 — overall availability will hold well-below the long-term average. This performance and the metro’s concentration of modern facilities will sustain an average asking rent that is nearly twice that of Dallas-Fort Worth and Houston.
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