Marcus & Millichap

Austin Retail Investment Forecast

Outlook 2019

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Investors Focus on Austin Single-Tenant Properties as Hedge Against Volatility

High-paying tech jobs supporting retail sales. Buoyed by a growing tech sector, the local job market has been one of the strongest in the nation through the current expansion, only slowing recently due to a dearth of available workers. The unemployment rate has hovered near 3 percent for nearly two years, which has hamstrung companies from expanding payrolls at a brisker pace. However, the relatively affordable cost of living compared with other tech strongholds will draw workers from more expensive metros. One company that will be in the market for employees is Apple, which recently announced a $1 billion campus in Austin that could eventually house 15,000 positions. While strong job and household growth will drive demand for retail goods, new supply also remains measured. No major projects are scheduled for delivery this year and most of the small, multi-tenant properties have some leasing commitments in place. As a result, vacancy will remain low again this year.

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