Data from real estate services firm CBRE shows commercial real estate continues to increase in these three cities. At the same time, the area’s vacancy rates are shrinking, a trend that experts say is likely to gain momentum.
Williamson County Chief Appraiser Alvin Lankford said many factors attract business and industry to the area, including available land.
“The land being flat to our east kind of lends itself well to those large businesses like that,” he said.
As one example, a $17 billion, 1,200-acre Samsung plant set for construction in Taylor over the next several years is likely to attract multiple auxiliary industries that should augment demand for commercial space, Lankford said.
Some manufacturing companies have already made known their plans to move to the area, such as Valex in Round Rock and Applied Materials in Hutto, while others are in the pipeline working to come online in time to support the needs of the Samsung semiconductor fabrication facility.
Valex, a manufacturer of distribution system components used in the semiconductor industry, will invest $12 million into the Round Rock tax base and bring 75 primary jobs to the area, and Applied Materials, a company that provides supplies and services to semiconductor manufacturers, is estimated to bring up to $2.4 billion in value to Hutto’s tax base and add about 525 jobs.
While industrial land use is growing in popularity, according to data from both the Travis and Williamson central appraisal districts, office real estate has also seen large growth, both in square footage and value.
Brentley Brinegar, owner of brokerage firm Brinegar Properties, said this is largely due to proximity to Austin and access to infrastructure.
“It’s just very easy for folks to get around [in Central Texas],” Brinegar said. “I think that’s really caused Round Rock to be a really strong secondary market to Austin.”
An attractive area
In addition to land availability, Lankford agreed with Brinegar that SH 130 and
SH 45 N, two arterial toll roads that intersect between Pflugerville and Hutto just east of Round Rock, are enhancing the area’s attractiveness for business development.
Lankford said the area is also good for employers, which helps drive development via a cycle of growth that is occurring locally.
“We’ve already seen a lot of announcements come out of smaller supporting businesses to Samsung,” Lankford said. “[They are] buying real estate or building buildings to support that huge facility out there. Then you’ll start to see more residential developments out in Taylor as well as in Hutto.”
Representatives for Kerby Ventures, the developer of Lakeside Meadows in eastern Pflugerville, also pointed to the strategic advantages of being near SH 130 and SH 45 N. Project leaders James Kerby and John Guerra said the 400-acre Lakeside Meadows project is bringing new industrial, multi- and single-family housing and office space to a stretch of property running from Pecan Street to Pflugerville Parkway.
Amy Madison, Pflugerville Community Development Corp. executive director, said the Austin Executive Airport, located south of Lakeside Meadows just outside of the city’s extraterritorial jurisdiction, is also contributing to demand for local office space.
“It provides us some really great opportunities for development of corporate headquarters as well, because people who are doing a lot of business need to be in the air a lot, and particularly executive flight,” Madison said.
Industrial age
With local growth increasing throughout multiple sectors, the industrial property footprint in Round Rock, Pflugerville and Hutto rose by several hundred million square feet from 2021-22, according to Travis and Williamson appraisal district data. ••Brinegar said large-scale operations such as the Amazon distribution center in Pflugerville, which became operational in summer 2021, have helped play a major role in expediting the local commercial growth.
Changes in the local retail market, such as increases in demand for online shopping and curbside services brought about by the COVID-19 pandemic, have also contributed to the changes, said Bradley Dushkin, Round Rock Planning and Development Services assistant director. He added that the shifts in preference have come through in recent local permitting requests.
There is increased interest in smaller industrial operations, with more than 2 million square feet in the pipeline in Round Rock alone, he said.
In Hutto, Economic Development Corp. Director Bob Farley said industrial facilities serve smaller companies with combined operations, and he has observed an increase in demand.••Farley said Hutto presents a unique option when compared to other major metropolitan areas. Availability of land means companies can build to suit, rather than retrofitting or renovating existing buildings.
“It’s unlikely that they’ll find exactly what they’re looking for in an existing space,” Farley said. “That doesn’t seem to be a surprise to anybody or slow down their desire.”
