Austin Office Market: 16 Straight Quarters of Positive Net AbsorptionAustin Office Market: 16 Straight Quarters of Positive Net Absorptionhttps://www.recenter.tamu.edu/news/newstalk-texas/?Item=103852015-01-30T13:42:00Z2015-01-30T00:00:00Z

AUSTIN (CBRE) – The local office market had its 16th consecutive quarter of positive net absorption to finish 2014, according to CBRE's fourth quarter office market report. The city posted a positive net gain of 318,635 sf in the fourth quarter and finished the year up more than 1.1 million sf.

The CBD had a strong quarter of positive net absorption with 176,610 sf. A large portion of this was explained by tenants moving into the new IBC Bank Plaza building that delivered last quarter.

Suburban submarkets had healthy positive net absorption. The northwest submarket finished the quarter with 85,375 sf of positive net absorption. The southwest submarket had 29,201 sf. Only the east submarket showed negative net absorption, with 5,576 sf.

Total vacancy continued its recent downward trajectory, finishing the quarter at 10.6 percent. This was a quarter-over-quarter decline of 80 basis points. Citywide direct vacancy fell to 9.5 percent. This was the first time since second quarter 2001 that citywide direct vacancy has been below 10 percent. CBD direct vacancy finished the fourth quarter at 8.7 percent, and suburban submarkets finished at 9.7 percent.

Citywide average asking rates reached new heights in the last quarter, finishing at $29.56 per sf. This was a $0.33 increase over the previous quarter's $29.23 per sf on a full service gross basis.

Class-A asking rates increased across all area submarkets, with the citywide Class-A rate finishing the fourth quarter at an average of $34.51 per sf. Class-B and -C had decreased rates in both the CBD and suburban submarkets.

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