Austin population growing, but retail construction limited

​​​​​​​AUSTIN – Local population growth this year is at 2.5 percent as out-of-state businesses continue to relocate to Central Texas, according to Marcus & Millichap’s second-quarter 2019 retail market report.

"With a solid demographic foundation in place, retailers will remain ​hard-pressed to find unoccupied space as the market’s vacancy sits near 4 percent," the report said.

Availability in the northern suburbs will stay limited, while outer-ring communities on the east side also see vacancy rates tighten due to a decline in development.

Builders will be largely focused on Hutto and Pflugerville where an array of single-tenant retailers will add locations.

Additionally, the Wolf Crossing project will take shape in Georgetown, accounting for roughly 115,000 sf. ​

For the remainder of 2019, Marcus & Millichap expects:

• Development will fall more than 50 percent, ending the three-year streak of at least one million sf. A total of 800,000 sf will be completed.
• Vacancy will not change. Leasing activity will catch up to supply amid a lull in development, keeping the rate at 4.2 percent.
• Asking rents will increase 2.9 percent to $23.13 per sf as rent growth falls short of the previous five-year average.