Austin’s South MoPac corridor is experiencing lower office vacancy rates compared to the rest of the city, according to data from Aquila Commercial. The area, which runs along MoPac Expressway from Lady Bird Lake to Highway 290, reported a 13.8 percent vacancy rate in the second quarter of this year. This marks a decrease from 18.1 percent three months prior and stands out against the metro average of about 17 percent. In contrast, submarkets such as East Austin are seeing nearly half of their office space available.
Aquila attributes the corridor’s appeal to its location, pricing, and convenience. Rents and operating expenses are less than those downtown, parking is free and widely available, and tenants can access central Austin quickly. Taylor McHargue, principal at Aquila Commercial, described the corridor as a “tight micromarket” with no new construction expected soon.
The market shift has been influenced by changes such as the city’s purchase of One and Two Barton Skyway last year, which removed almost 400,000 square feet of office space for consolidating city departments. Companies like JE Dunn Construction are also relocating to the area; it plans to move into a 25,000-square-foot office at Terrace 6 next year.
Casey Casper, managing director at HPI Real Estate—which owns and occupies space at Barton Oaks Plaza II and III—said demand has increased: “Companies weighing downtown often opt for South MoPac instead,” he told the outlet. He cited easier commutes for employees living south and west of Austin as well as executives residing along the corridor influencing decisions.
Discounted rents and lower expenses have contributed to making South MoPac more attractive during a period when cost-sensitive tenants are avoiding downtown’s higher vacancy rate of 28 percent. McHargue noted that “discounted rents, lower expenses and no parking charges have made the corridor more competitive.”
The combination of high demand and limited supply has resulted in one of Austin’s few submarkets trending toward high occupancy. At the end of the second quarter, about 450,000 square feet were available—including sublease offerings—out of an inventory totaling roughly 3.3 million square feet.
