AUSTIN, Texas — Downtown Austin's construction boom is slowing down for the first time in years.
While 17 projects remain under construction, most of which are residential, officials with the Downtown Austin Alliance (DAA) said Austin is starting to move in a different direction with development.
“We are seeing a slowdown. We have had 10 years of really hot growth ... At some point, things have to slow down and that's where we are at right now," DAA CEO Dewitt Peart said.
According to Peart, 50% of the buildings in Downtown Austin are made up of office space. They make up about 24 million square feet and are 75% occupied. However, he says a good number should be around 90%.
"A lot to do with hybrid work," Peart said. "We are nationally going through a transformation in the way we work."
According to the DAA, about 600,000 square feet of the new Sixth and Guadalupe Tower was pre-leased to Facebook's parent company, Meta. The company later decided to sublease the space instead.
The DAA said Austin's office market is going through what they call a “recession stage” where there is more space than tenant demand. However, Peart expects things to pick up in the future.
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Meanwhile, the Downtown Austin housing market currently has 10,000 units, with 3,000 more on the way. Peart said the demand for living downtown is big.
"People want to be in a place that is active and vibrant," Peart said. "The amenities that Austin offers can certainly be found downtown."
Boomtown is KVUE's series covering the explosive growth in Central Texas. For more Boomtown stories, head to KVUE.com/Boomtown.