Vacancy in San Antonio

The overall vacancy is at 10.0%, unchanged from this time last year. Meanwhile, the gross average asking rental rate keeps increasing, growing to $23.12 per sq. ft., up $0.80 (3.6%) year-over-year. Occupancy of the 918,000 sq. ft. delivered to the market year-to-date stands at 81.3%, and of the 1.4 million sq. ft. currently under construction.


Market Highlights

Climbing average annual asking rates. Overall vacancy is at 10.0%, unchanged from this time last year. Meanwhile, the gross average asking rental rate keeps increasing, growing to $23.12 per sq. ft., up $0.80 (3.6%) year-over-year. Occupancy of the 918,000 sq. ft. delivered to the market year-to-date stands at 81.3%, and of the 1.4 million sq. ft. currently under construction, about half of that space is already spoken for. In addition, there has been 2.0 million sq. ft. of leasing activity year-to-date—which is comprised of both new leases and renewals—up 12.6% from this time a year ago.

Investment sales activity. Real Capital Analytics data reports the San Antonio area office sales volume year-to-date through September at $483.5 million, up 14.1% compared to this time last year at $423.8 million. The primary capital composition for buyers in 2019 was made up of 53.3% institutional investors, and for sellers the majority was 43.2% REIT/listed. In September, The University of Incarnate Word acquired AT&T’s 347,426 sq. ft., eight-story office building on 10 acres at 4119 Broadway for a much-needed expansion. The building was last assessed for $17 million by the Bexar County Appraisal District.

San Antonio labor markets remain tight. San Antonio’s economy expanded at a healthy pace in September. The unemployment rate ticked down to 3.0%, the Texas rate held steady at 3.4%, and the U.S. rate declined to a five-decade record low of 3.5%. San Antonio jobs grew at a strong 4.6% annualized rate in the third quarter, with construction jobs leading the way with a significant 29.1% increase (3,500 net jobs). Leisure and hospitality also saw considerable growth (3,800 jobs), while trade, transportation and utilities, health care, and professional and business services also saw net hiring, adding a collective 3,100 jobs.

San Antonio Office Commercial Real Estate Market Data and Information - Market Activity table

San Antonio Office Commercial Real Estate Market Data and Information - Sales Volume graph

San Antonio Office Commercial Real Estate Market Data and Information - Supply Demand graph