Austin's industrial market saw a slowdown in new construction and negative net absorption in Q2 2019, though leasing activity remained high. Vacancy rates increased slightly to 8.8% as over 140,000 square feet of new space was delivered. Looking ahead, over 460,000 square feet of space has been leased for Q3 2019 occupancy, including an 89,000 square foot lease to FedEx. Average rental rates decreased moderately across all product types compared to Q1 2019. Approximately 951,000 square feet remained under construction across 14 projects in Austin.

1. Austin’s industrial market sees a slowdown
in new construction, but more leases
Research &
Forecast Report
AUSTIN | INDUSTRIAL
Q2 2019
Kaitlin Holm Research and Marketing Coordinator | Austin
Austin’s industrial market posted 80,820 square feet of negative net
absorption in the second quarter of 2019. Activity levels remained
high as a large number of sizeable tenants occupied significant
blocks of space over the quarter including Ceva Logistics, a global
logistics and supply chain company that moved into 36,000 square
feet at 8606 Wall Street in the Northeast submarket.
Looking forward, twenty blocks of space over 10,000 SF will be
occupied by new tenants in the third quarter of 2019. One of these
tenants is FedEx, who is taking 89,332 square feet at 4500 South
Pleasant Valley Road in the Southeast submarket.
Austin’s citywide average rental rates decreased moderately over
the quarter, moving down to $10.17 per square foot in Q2 2019
from $10.57 per square foot in Q1 2019. The average citywide
Flex/R&D rental rate decreased moderately to $13.65 per square
foot from $14.14. The average Warehouse/Distribution rental rate
decreased slightly over the quarter from $8.61 per square foot to
$8.40 per square foot.
In all, 951,431 square feet of industrial supply was under
construction consisting of fourteen projects. 115,351 square feet of
projects in the development pipeline are scheduled to deliver in the
third quarter and 8,000 square feet of that inventory is pre-leased.
Summary Statistics
Austin Industrial Market Q2 2018 Q1 2019 Q2 2019
Vacancy Rate 7.5% 8.5% 8.8%
Net Absorption (SF) 208,552 -278,770 -80,820
New Construction (SF) 750,378 861,274 140,080
Under Construction (SF) 1,566,574 1,337,202 951,431
Asking Rents
Per Square Foot Per Year
Average $9.69 $10.57 $10.17
Warehouse/Distribution $8.45 $8.61 $8.40
Flex/R&D $12.43 $14.14 $13.65
Market Indicators
Relative to prior period
Annual
Change
Quarterly
Change
Quarterly
Forecast*
VACANCY
NET ABSORPTION
NEW CONSTRUCTION
UNDER CONSTRUCTION
*Projected

2. In June, Boyd Watterson Asset Management
purchased the 41,423 SF industrial
distribution building from DRA Advisors
LLC. The building is currently 100% leased
and was sold for $8,198,537 ($197.92/SF).
This was part of a four-property portfolio
purchase.
2525 Ridgepoint Drive
Job Growth & Unemployment
(not seasonally adjusted)
UNEMPLOYMENT 7/18 7/19
AUSTIN 3.2% 2.7%
TEXAS 4.1% 3.7%
U.S. 4.1% 4.0%
JOB GROWTH
Annual
Change
# of Jobs
Added
AUSTIN 2.3% 24.4K
TEXAS 2.7% 340.4K
U.S. 1.5% 2.2M
The 22,500 SF industrial warehouse
building was purchased in May, just after
being built, by Blue Label Granite, for
$1,900,00 ($84.44/SF), from EMMF, Inc.
2 Austin Research & Forecast Report | Q2 2019 | Industrial | Colliers International
Sales Activity
Sources: Real Capital Analytics and CoStar
Q2 2019
No. of Properties: 26
Total SF: 1.5M SF
Average $/SF: $135
Average Cap Rate: 6.8%
1481 Robert S Light Boulevard
Vacancy & Availability
Austin’s citywide average vacancy rate increased from 8.5% to 8.8% over the
quarter, due in part to new deliveries. The most significant increase in vacancy
over the quarter occurred in the Southeast submarket where the vacancy rate
jumped from 11.2% to 12.0%. The East, Far Northwest, Hays County, North,
Northeast, Round Rock and Southeast submarkets also saw an increase in
vacancy in Q2 2019.
The largest quarterly decrease in vacancy occurred in the Southwest submarket,
where it fell from 7.6% in Q1 2019 to 4.6% in Q2 2019. Other submarkets
reporting a decrease in vacancy include the Central, Far Northeast, South and
Southwest submarkets.
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
10.0%
11.0%
12.0%
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
$9.00
$10.00
$11.00
Industrial Rental Rate and Vacancy Percentage
Austin, TX
Avg Quoted Rent Avg Vacancy
*Vacancy percentage includes direct and sublease space.
Absorption & Demand
Although Austin’s industrial market posted negative net absorption of 80,820
square feet in Q2 2019, more than twenty tenants moved into over 460,000 SF of
industrial space during the second quarter of 2019. One of the tenants that moved
into space in Q2 included TireHub, LLC relocating into 40,467 square feet at
Heritage Crossing - Building 7 (2300 Scarbrough Drive) in the North submarket.
The Far Northeast submarket posted the largest amount of positive net absorption
with 36,794 square feet. The South submarket had the second greatest
absorption with 29,737 square feet of positive net absorption. Other submarkets
that posted positive absorption includes Central, Hays County, Northwest, Round
Rock and Southwest.
The submarkets that posted negative net absorption were East, Far Northwest,
North, Northeast and Southeast. The Southeast submarket had the highest
negative absorption with 94,718 square feet of negative net absorption in the
second quarter. This can be attributed to 313,081 square feet of space that came
to the market, including a 57,557 square foot space at 4509 Freidrich Lane.
Rental Rates
According to CoStar, our data service provider, the citywide average rental rate
decreased over the quarter from $10.57 per square foot in Q1 2019 to $10.17 per
square foot in Q2 2019. Annually, the citywide average rental rate has increased
4.9% from $9.69 in Q2 2018.
The highest average rental rate at the end of Q2 was in the South submarket at
$14.35 per square foot annually. The submarket with the lowest average rental
rate in Q2 2019 was the Hays County submarket at $5.71 per square foot.

3. 3 Austin Research & Forecast Report | Q2 2019 | Industrial | Colliers International33
Q2 2019 Top Industrial Lease Transactions
BUILDING NAME/ADDRESS SUBMARKET SF TENANT LEASE DATE
7900 E Riverside Dr Southeast 99,925 OES Equipment Jun-19
1105 New Meister Ln Far Northeast 85,400 Home Depot May-19
Hwy 183 & Burleson Rd Southeast 85,000 FedEx Jun-19
500 Alliance Blvd Georgetown 79,975 Western Industries Apr-19
2400 Grand Avenue Pkwy North 67,950 Unknown Jun-19
1309 Rutherford Ln Northeast 61,440 Goodwill Apr-19
3161 Eagles Nest St Round Rock 45,862 Unknown Jun-19
1033 Meister Ln Far Northeast 37,800 CED Jun-19
845 Interchange Blvd East 37,200 Unknown Jun-19
3813A Helios Way Far Northeast 36,000 Unknown2
May-19
2251 Picadilly Dr Far Northeast 35,125 Xdesk1
Jun-19
6320 Stassney Ln Southeast 34,728 Siete Family Foods Apr-19
1340 Airport Commerce Dr Southeast 32,823 Unknown Jun-19
10214 I-35 N North 30,000 TJ’s Cycles May-19
800 Interchange Blvd East 24,000 RBT Industries Apr-19
900 E Old Settlers Blvd Round Rock 23,927 Unknown Jun-19
6231 E Stassney Ln Southeast 21,600 Unknown2
Apr-19
8329 Cross Park Dr Northeast 20,511 Clinical Pathology Laboratories, Inc.2
Jun-19
Leasing Activity
Austin’s industrial leasing activity included 1,111,128 square feet of space in Q2 2019. The bulk of the leases signed in the second quarter
were in the Southeast submarket, totaling 326,235 square feet. The largest new lease was signed by OES Equipment for 99,925 square
feet at 7900 East Riverside Drive in the Southeast Industrial submarket.
1
Renewal 2
Sublease
AUSTIN INDUSTRIAL MARKET STATISTICAL SUMMARY
Q2 2019
Market
#
Bldgs
Rentable
Area
Direct
Vacant
SF
Direct
Vacancy
Rate
Sublet
Vacant
SF
Sublet
Vacancy
Rate
Total
Vacant SF
Total
Vacancy
Rate
2Q19 Net
Absorption
1Q19 Net
Absorption
2Q19
Comple-
tions
1Q19
Comple-
tions
SF Under
Construc-
tion
Austin Total 824 51,994,148 4,141,893 8.0% 428,990 0.8% 4,570,883 8.8% (80,820) (278,770) 1,027,296 542,858 951,431
Central 30 1,081,796 24,156 2.2% - 0.0% 24,156 2.2% 18,460 6,915 - -
East 64 3,585,078 326,832 9.1% - 0.0% 326,832 9.1% (21,887) (68,793) - -
Far Northeast 44 3,253,977 204,756 6.3% 79,806 2.5% 284,562 8.7% 36,794 (71,555) 280,327 - 36,000
Far Northwest 15 658,024 16,574 2.5% - 0.0% 16,574 2.5% (3,924) (1,650) - -
Hays County 43 3,192,568 392,358 12.3% 4,403 0.1% 396,761 12.4% 10,619 (92,578) 243,300 32,500 196,080
North 215 3,530,597 711,120 5.3% 12,159 0.8% 823,279 6.1% (45,660) 89,544 - -
Northeast 122 8,101,029 717,988 8.9% 72,444 0.9% 790,432 9.8% (60,995) 122,562 62,850 -
Northwest 25 2,505,884 120,028 4.8% - 0.0% 120,028 4.8% 25,024 (49,502) - -
Round Rock 51 2,659,777 286,823 10.8% - 0.0% 286,823 10.8% 18,480 (42,340) 110,901 223,530 23,351
South 37 1,423,911 75,135 5.3% 3,012 0.2% 78,147 5.5% 29,737 24,672 23,978 -
Southeast 172 1,758,779 1,254,873 10.7% 157,166 1.3% 1,412,039 12.0% (94,718) (192,295) 392,768 - 696,000
Southwest 6 242,728 11,250 4.6% - 0.0% 11,250 4.6% 7,250 (3,750) - -
Austin Industrial Market Summary

4. 4 Austin Research & Forecast Report | Q2 2015 | Office | Colliers International4 North American Research & Forecast Report | Q4 2014 | Office Market Outlook | Colliers International
Copyright © 2015 Colliers International.
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.
Colliers International | Market
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000 Address, Suite #
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4 North American Research & Forecast Report | Q4 2014 | Office Market Outlook | Colliers International
Copyright © 2019 Colliers International.
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.
Colliers International | Austin
111 Congress Avenue, Suite 750
Austin, Texas 78701
+1 512 539 3000
colliers.com/austin
FOR MORE INFORMATION
Advisor Contacts:
Travis Hicks
Vice President | Austin
+1 512 539 3005
travis.hicks@colliers.com
Research Contact:
Kaitlin Holm
Research and Marketing Coordinator | Austin
+1 512 539 3021
kaitlin.holm@colliers.com
Chase Clancy
Associate | Austin
+1 512 539 3023
chase.clancy@colliers.com
Q2 2019 Industrial Under Construction - 10,000 SF or greater
Q2 2019 Austin Industrial Highlights
BUILDING ADDRESS SUBMARKET RBA
%
LEASED
DEVELOPER
ESTIMATED
DELIVERY DATE
BUILDING
DESCRIPTION
4701 Priem Ln - Building 6 Far Northeast 12,000 0.0% Unknown Jul-19 Industrial Warehouse
4701 Priem Ln - Building 4 Far Northeast 12,000 0.0% Unknown Aug-19 Industrial Warehouse
Longhorn Crossing - 4701 Priem Ln Far Northeast 12,000 0.0% Unknown Aug-19 Industrial Warehouse
Midway Commerce Park - 200 Posey Rd Hays County 50,000 16.0% Development 2000, Inc. Aug-19 Industrial Warehouse
171 Spring Ln - Building 2 Hays County 6,000 0.0% Development 2000, Inc. Sep-19 Industrial Warehouse
10921 E Crystal Falls Pkwy-Building D Phase I Round Rock 11,250 0.0% Unknown Sep-19 Industrial Warehouse
1220 Satterwhite Rd Hays County 140,080 92.2% Unknown Nov-19 Industrial
2100 Double Creek Dr - Building 5 Round Rock 12,101 0.0% PW Development LLC Dec-19 Industrial Warehouse