Warehouse surge

Austin booms among hottest markets for industrial construction in new report

Austin is the No. 3 market in the Southwest for under-construction warehouse and distribution centers.

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It's not just Austin's residential real estate market that's hot. Austin is among the hottest markets in the Southwest for under-construction warehouse and distribution centers.

Data published by Community Property Executive shows Austin had nearly 8.3 million square feet of industrial space under construction in late June. That represents a little over 7 percent of the existing industrial space (more than 114 million square feet) in the region.

Austin ranks third in the Southwest, behind Dallas and Houston, according to Commercial Property Executive, at Nos. 1 and 2, respectively. Dallas is also the No. 1 market in the U.S., beating out Phoenix (No. 2) and Southern California's Inland Empire (No. 3) nationally.

In Austin and throughout the country, the meteoric rise of e-commerce is the main driver of industrial construction. In May, the average vacancy rate for industrial space in the U.S. sat at a rock-bottom 4.7 percent, Commercial Property Executive says.

“Although the COVID-19 pandemic brought on new challenges for the industrial market, with port congestion, materials shortages, and commodity pricing skyrocketing, the market has and will continue to excel,” commercial real estate services company Cushman & Wakefield says in a recent report.

Elsewhere in Texas, 21.2 million square feet of industrial space was under construction in the Houston area at the end of June, Commercial Property Executive says. The same figure was more than 5.7 million for the El Paso area, and almost 4 million for the San Antonio area.

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hottest headlines of 2024

Top Austin real estate stories of 2024 unlock hot suburbs, lavish homes

Photo by Mack Ramirez on Unsplash

It seems like everyone is hoping for lower housing prices as we move into 2025.

Editor's note: As 2024 comes to a close, we're looking back at the stories that defined Austin this year, including the red-hot topic of real estate. Austin's real estate market has seen some dramatic swings this year, but that's not all that happened. From Austin's suburbs continuing to boom to lavish estates hitting the market, here's a look at the hottest real estate headlines of 2024.

1. Annual Outdoor Living Tour returns for 2024 in Austin's 8 best backyards. The 2024 tour spanned a wide geography across Austin, including Travis Heights, Rollingwood, Allandale, and more.

2. Austin suburb's ZIP code stands out on new list of hottest U.S. housing markets in 2023. This Leander ZIP code was the 13th hottest market, showing that interest in the suburbs is as popular as ever.

3. Texas chef's Old West Austin home hits the market for $1.65 million. This home was originally built as a guest house in 1947, but has since been completely renovated with modern style.

1002 Baylor Street, Old West Austin, home for sale, Chef Lou Lambert The home is located above the street for privacy. Photo courtesy of James H Ruiz Photography

4. 5 Austin neighbors lauded as best small cities in America. Leading the pack were the northwest Austin suburbs of Leander and Cedar Park.

5. Drake suspected new owner of $15 million Dos Brisas ranch in Texas. Drake was reportedly the latest rap icon that can proudly say he's a Texan after purchasing this acclaimed 313-acre ranch in Washington, Texas.

6. 3 Austin neighbors shine on new list of America's safest suburbs. Cedar Park, Georgetown, and Round Rock have earned high praise for their livability and growth in recent years.

7. 6 hot Austin-area ZIP codes for first-time homebuyers in spring 2024. A local real estate expert shared his insight into the ZIP codes – from Kyle to Pflugerville – that received the most attention from first-time buyers.

8. South Austin 'entertainer's paradise' hits the market for $4 million. This 10,343-square-foot property comes with an expertly designed game room, a trendy golf simulator, an outdoor kitchen and lounge, a light up three-car carport, and much more.

9. This $4.85 million Hill Country ranch with its own lazy river is going wild on social media. The Lazy River Ranch in Boerne makes a splash with its many extravagant amenities.

227 Seewald Road, Boerne, Lazy River Ranch The Lazy River Ranch is at 227 Seewald Rd., Boerne. Photo courtesy of Kuper Sotheby's

10. Historic Greek mansion near Austin hits the market for just under $1 million. This Greek Revival mansion in Lockhart, built in 1907, was looking for a new owner to cherish its rich past.