Of­fices

Austin American-Statesman - - MONEY & MARKETS -

healthy growth.”

Austin’s 3.6 percent job­less rate is sig­nif­i­cantly lower than the na­tional av­er­age of 4.4 percent, Cush­man & Wake­field said in its lat­est quar­terly re­port. And job growth in the re­gion also con­tin­ues to out­pace na­tional av­er­ages, the re­port noted.

Cit­ing U.S. Bu­reau of La­bor statis­tics, the re­port said the Austin re­gion added more than 29,000 jobs in the past 12 months, a 2.9 percent growth rate.

In another quar­terly of­fice re­port, global com­mer­cial real es­tate firm Avi­son Young said that “de­mand for of­fice space from large tech­nol­ogy ten­ants re­lo­cat­ing to the Austin mar­ket re­mains strong, driv­ing leas­ing ac­tiv­ity and rental rates to new highs.”

Avi­son Young said rents grew al­most $5 per square foot com­pared to June 2016. And as Class A supply grows, rental rates are pro­jected to re­main high, Avi­son Young said.

“While climb­ing op­er­at­ing ex­penses are largely re­spon­si­ble for such marked in­creases due to ris­ing build­ing val­u­a­tions com­mand­ing higher taxes, sus­tained de­mand has held rates at an up­ward clip,” Avi­son Young said.

New build­ing open­ings were a high­light of the sec­ond quar­ter, Cush­man & Wake­field said.

More than 928,000 square feet of new space opened, in­clud­ing 500 W. 2nd, whose an­chor ten­ant will be Google Inc., as well as a new of­fice build­ing at the Do­main in North Austin, and Gal­le­ria Oaks A and Gal­le­ria Oaks B ad­ja­cent to the mixed-use Hill Coun­try Gal­le­ria project in Bee Cave west of Austin.

Gal­le­ria Oaks A and B, each of which have 75,000 square feet, are 65 percent leased com­bined, said Kevin Granger, a part­ner in Austin with Pelo­ton Com­mer­cial Real Es­tate Ser­vices. The two largest leases to date are TruCar Inc., which is leas­ing 36,000 square feet of space in Gal­le­ria Oaks A, and Sum­mit Ho­tel Prop­erty Group, which is leas­ing the top floor in Gal­le­ria Oaks B, Granger said.

In the mar­ket in gen­eral, “ac­tiv­ity is still very strong,” Granger. “We have a large amount of good or­ganic growth of ex­ist­ing com­pa­nies, and a large in­flux of new com­pa­nies com­ing into Austin that are con­tin­u­ing to grow.”

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