The industrial market in Austin, TX continued to experience tight supply and strong demand in the second quarter of 2021. Net absorption was 1,006,935 SF while vacancy dropped to 6.6%. However, the large development pipeline will not provide meaningful relief on vacancy until late 2021 and early 2022 as 2.3 million SF is currently under construction. With constrained supply across all size ranges, escalating rents and limited concessions are expected to continue through the rest of the year.

1. 20Q2 21Q1 21Q2
Total Inventory (SF) 50,926,347 51,761,282 52,295,340
New Supply (SF) 172,795 199,757 534,058
Quarterly Net
Absorption (SF)
262,891 (65,627) 1,006,935
Overall Vacancy 10.2% 8.6% 6.6%
Under Construction
(SF)
668,146 1,625,600 2,294,071
Overall Average Asking
Rate (W/D)
$8.74 $9.03 $9.78
Overal Average Asking
Rate (Flex)
$14.17 $16.43 $15.24
Lease
Single Trace Parkway
North | 185K SF
DXC Technology Company
Sale
Pecan 130 Business Park
Far Northeast | 239K SF
Seller: Birtcher, Anderson & Davis
Buyer: Dogwood Industrial Partners
Sale
Met Center II – Building III
Southeast | 160K SF
Seller: Mohr Capital
Buyer: Four Springs Capital
Trust
Lease
Park 183 – Phase III, Bldg 5
Southeast | 154K SF
Total Office/
Move Solutions
Sale
Southpark Commerce Center
Southeast | 372K SF
Seller: KBS
Buyer: BentallGreenOak
YOY
FORECAST
YOY
YOY
FORECAST
YOY
FORECAST
FORECAST
Industrial
Austin,
TX
21Q2
Boots On the Ground
If you were a tenant seeking more than 100,000 SF of industrial space this quarter, we feel for you. Austin’s industrial market
continued its trend of tight supply throughout Q2, driving many tenant requirements into a dwindling supply of shell space while
the market awaits new deliveries later this year and into early next. Case in point: Any tenant requirement over 100,000 SF that
couldn’t work in a dated metal building was forced to look at shell space, much of which hasn’t yet delivered. There were no 2nd
generation tilt-wall options over 100,000 SF across the market.
Unemployment Rate
Market Indicators
Historic Comparison
4.2%
Austin
Unemployment
Rate
1.47%
US 10 Year
Treasury Note
5.8%
US
Unemployment
Rate
Vacancy Rate
6.6%
Net Absorption
1.0M SF
Average Asking Lease
Rates (FSG)
$11.45/SF
Under
Construction
2.3M SF
Key Takeaways
• Supply constraints across all size ranges are forcing many
tenants to consider shell space or pre-leasing in planned and
under construction projects
• Third-party suppliers for Tesla’s Gigafactory have commenced
executing leases – more anticipated in the second half of 2021
• Escalating rents and marginal concessions will likely trend
through the year until projects currently under-construction
deliver in early 2022
Recent Transactions
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18Q1
18Q2
18Q3
18Q3
18Q4
19Q1
19Q1
19Q2
19Q3
19Q3
19Q4
20Q1
20Q1
20Q2
20Q3
20Q3
20Q4
21Q1
21Q1
21Q2
Austin Texas US

2. Colliers | Austin | 21Q2 | Industrial Report
Industrial
Austin,
TX
21Q2
Absorption, Supply & Demand
0.0%
4.0%
8.0%
12.0%
(200,000)
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021
Net Absorption Completions Vacancy Rate
Future Forecast
The strong demand in the area has everyone’s sights set on the development pipeline which, while extensive, won’t provide
significant relief on vacancy until at least Q4 2021 and into Q1 2022. Planned projects and those currently under construction
promise to deliver an additional 5 million square feet of space by the first part of 2022, which we anticipate will temper rate
growth and stimulate more competition amongst developers and landlords for deals.
That said, the market remains constrained in the 2nd quarter of 2021, and with no signs of slowing demand, we anticipate
inflated rents and skinny tenant concessions in the near term until the real competition starts.
The Market, at a Glance
With the market constrained for space across size ranges, Austin continued the novel trend of pre-leasing with much of the
activity taking place in the Southeast and Hays County submarkets. Notably, in June, NorthPoint Development officially delivered
the Plum Creek Industrial Center 92% pre-leased. Between deals struck in Phase I (444,058 SF) and one of the largest lease deals
ever signed in the Austin area totaling 491,651 SF in Building III, the Plum Creek Industrial Center is left with only 73,528 SF of
vacant space out of the 935,709 SF planned in the park. Elsewhere, spec industrial projects have seen similarly robust pre-leasing
activity, including Phase II at Park 183 in the Southeast submarket which is nearly 80% pre-leased across its two buildings totaling
317,572 SF under construction.
Since Tesla’s announcement of their new manufacturing facility in East Austin, all eyes have been on the cadre of third-party
suppliers and ancillary manufacturers that were competing for lucrative contracts with the company. The second quarter
brought the first of these leases, with more planned in the coming months.
Robust demand and lagging
supply have squeezed the Austin
market, benefiting Landlords
with inflated rates and abundant
preleasing. This is clearly illustrated
by Q2’s absorption of 1,006,935
SF – a 12-month high in an already
bustling year. Many construction
projects (2,294,071 SF currently
under-construction) won’t be shell
complete until early 2022, which will
continue to drive fierce competition
amongst the multitude of tenants
seeking space through the second
half of 2021.

3. Colliers | Austin | 21Q2 | Industrial Report
Industrial
Austin,
TX
21Q2
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
East Georgetown Hays County Northeast &
Far Northeast
Round Rock Southeast
Under Construction Planned Proposed
Upcoming Projects
Jul ‘21
Jul ‘21 Mar ‘22
Mar ‘22
NorthPark 35, Bldg. I & II
331,030 SF | Georgetown
Titan Development | Q3 2021
Tuscany Logistics Center – Buildings I, II & III
373,477 SF | Northeast
Dalfen Industrial | Q4 2021
Springbrook Corporate Center – Buildings I & II
246,435 SF | Round Rock
IDI Logistics | Q4 2021
130 Logistics Center – Buildings I & II
248,112 SF | Far Northeast
Lincoln Property Group | Q1 2022
Speculative Development Pipeline

4. Copyright © 2021 Colliers
The information contained herein has been obtained from sources
deemed reliable. While every reasonable effort has been made to
ensure its accuracy, we cannot guarantee it. No responsibility is
assumed for any inaccuracies. Readers are encouraged to consult
their professional advisors prior to acting on any of the material
contained in this report.
John O’Sullivan
Research Associate
Austin
+1 512 539 3012
john.o’sullivan@colliers.com
David Bremer, SIOR
Managing Director
Austin
+1 512 539 3014
david.bremer@colliers.com
FOR MORE INFORMATION
Travis Hicks, SIOR
Vice President
Austin
+1 512 539 3005
travis.hicks@colliers.com
Chase Clancy
Associate Vice President
Austin
+1 512 539 3023
chase.clancy@colliers.com
Submarket Existing Inventory (SF) Direct Vacancy (SF) Sublease Vacancy (SF) Overall Vacancy Rate
Quarterly Net
Absorption (SF)
Weighted Average
Asking Rate
Market Total
Warehouse/Distribution 36,453,229 2,177,821 274,903 6.7% 1,028,834 $9.78
Office Service/Flex 15,842,111 880,980 125,625 6.4% (21,899) $15.24
TOTAL 52,295,340 3,058,801 400,528 6.6% 1,006,935 $11.45
Flex/Office Service
Central 391,323 23,559 – 6.0% 16,770 $14.79
Cedar Park 680,893 114,769 – 16.9% 4,242 $16.46
East 1,181,798 15,582 3,354 1.6% 3,284 $32.89
Far Northeast 338,788 9,800 – 2.9% (1,700) $15.25
Far Northwest 133,390 1,516 – 1.1% 3,017 $15.51
Georgetown 222,496 – – 0.0% – –
Hays County 420,392 20,572 – 4.9% 5,571 –
North 3,438,030 174,511 9,305 5.3% (31,361) $16.73
Northeast 3,436,693 305,297 9,000 9.1% (12,143) $10.40
Northwest 1,646,625 27,195 4,311 1.9% – $14.29
Round Rock 341,056 20,511 – 6.0% 4,278 $10.62
South 323,824 2,000 – 0.6% (2,000) $34.00
Southeast 3,139,578 165,668 99,655 8.5% (11,857) $15.04
Southwest 147,225 – – 0.0% – –
TOTAL 15,842,111 880,980 125,625 6.4% (21,899) $15.24
Austin | Q2 2021 | Industrial | Market Statistics
Warehouse/Distribution
Central 666,931 139,062 – 20.9% (75,350) $16.52
Cedar Park 61,632 – – 0.0% – –
East 2,038,579 185,506 – 9.1% 61,010 $10.53
Far Northeast 3,085,153 146,961 33,600 5.9% 77,471 $10.39
Far Northwest 397,685 28,500 – 7.2% (13,000) $12.00
Georgetown 1,719,561 403,896 – 23.5% 71,954 $7.18
Hays County 3,884,241 107,145 46,253 4.6% 252,554 $6.64
North 8,748,880 320,382 49,661 4.2% 276,433 $10.34
Northeast 3,655,447 225,582 609 6.2% 54,608 $9.96
Northwest 1,079,275 16,788 – 1.6% 1,300 –
Round Rock 2,021,630 250,339 – 12.4% 42,547 $11.65
South 994,345 52,323 – 5.3% (14,728) $15.52
Southeast 7,990,865 301,337 144,780 5.6% 294,035 $9.38
Southwest 109,005 – – 0.0% – –
TOTAL 36,453,229 2,177,821 274,903 6.7% 1,028,834 $9.78