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AUSTIN (KXAN) – The economic impact of the pandemic resulted in closed storefronts in a normally thriving downtown area.
The Downtown Austin Alliance has compiled data showing how much downtown businesses have suffered.
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The alliance said that around 20-25% of downtown stores appeared to be empty as of February.
“88 storefronts have reportedly closed, and we are unsure of an additional 96 stores,” said Jenell Moffett, director of research and analysis for the Downtown Austin Alliance, while presenting the report on Wednesday.
Office visits also fell dramatically during the pandemic.
“Downtown office visits fell by almost 90% in April. As restrictions changed, we’ve seen an increase in employee returns … but we’re still well below pre-pandemic levels, “Moffett said.
Employers also paused discussions about what work would be like after the pandemic, and vacancies nearly doubled over the course of 2020.
“Many hesitated to set the terms for office space. As a result, vacancies also increased, ”said Moffett.
But empty storefronts don’t necessarily reflect the future of the inner city, which Allianz says is poised for an upturn.
John Gump, Austin executive vice president of CBRE, a global commercial real estate company, said demand for office space is now about the same as it was before the pandemic.
“It feels like we’re back on full speed ahead,” said Gump.
He said they are tracking demand in excess of 2 million square feet – tenants who are either actively looking for new space or moving from an existing space.
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“It will be reflected in deals, it will be reflected in reduced vacancies and increased space absorption, probably towards the end of the second quarter, beginning of the third quarter and definitely in the fourth quarter,” said Gump.
Why the demand?
Gump said more and more businesses are moving to Austin from the east and west coasts, and businesses that are already here are either looking for more space or somewhere else when they switch to hybrid work.
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“’Look, if we’re taking up a little less space, we might as well make sure that the space we’re taking is really well suited to our needs, and we’re willing to pay a little more for it. “Explained Gump.
The Downtown Austin Alliance announced that five towers will open this year, offering more than 1.5 million square feet of office space. They said it would break all previous year records for Austin.
Gump said he already saw a lot of demand for these spots.
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