Austin, Texas: Your 2-Minute Retail Tour

THE NUMBERS

The Texas capital city boasts a population of 964,177, per 2021 U.S. Census Bureau estimates, making it the 11th most-populous city in the country and the fourth in the state. It’s a tech and business hub, dubbing itself “Silicon Hills” for the numerous Fortune 500 companies that have set up shop in its ecologically diverse surrounds, including 3M, Oracle, Tesla and Whole Foods Market. Austin’s official slogan is “The Live Music Capital of the World,” thanks to its more than 200 music venues as well as popular festivals, South by Southwest (SXSW) and Austin City Limits. (The city will also play host to the Shop! MarketPlace trade show this April 25-27.)

THE PULSE

“Music Lane on South Congress Avenue is one of the newest, most attractive developments in Austin,” says Hutch Hutchings, Assistant VP at Edge Realty Partners, which has a location in Austin. “It’s taking on the higher end national retailers in a territory not known for that, so you’ve seen a substantial change.”

The trendy neighborhood, celebrated for its mix of local shops and restaurants and live music venues, welcomed a number of notable retailers to Music Lane, including members-only club Soho House Austin, Rag & Bone, Nike, Alo Yoga, fast-casual chain Sweetgreen and luxury French fashion house Hermès, which opened a 7600-square-foot store last year. (About four miles down the road, H-E-B also unveiled a 97,000-square-foot store in Lake Austin; another South Congress and Oltorf location is under construction.)

Despite what Hutchings says are “some of the most aggressive rents we’ve seen” comparable to Los Angeles or New York, the upscale development is mostly leased. “Tenants are looking for foot traffic and South Congress is one of the highest foot trafficked areas of our city,” he says.

South Congress (a.k.a. SoCo) is a huge draw for locals and tourists alike.
📷 Alfie Photography / Shutterstock.com

THE HOT SPOTS

Austin’s downtown core remains a vibrant and popular destination. In fall 2022, the Downtown Austin Alliance reported 27 development projects – representing 10.4 million square feet – were under construction, including the 74-story, mixed-use Waterline tower which, when completed, will be the tallest in Texas. Another hot spot, besides the aforementioned South Congress, is new mixed-use community The Grove on the west side of Austin, featuring residential space, offices, restaurants and retail. Phase one and two are complete, phase three is under construction, while phase four is delivering in the next couple of years. “The placement of it is unique,” Hutchings says. “There truly wasn’t a larger, higher-end retail center with a mixed-use capacity on that side of the city.”

OBSTACLES AND OPPORTUNITIES

Because of Austin’s proximity to the Hill Country, its topography presents challenges that differ from other major cities in Texas. “On the west side where Hill Country starts, it gets more difficult to find development opportunities,” Hutchings says, “so that’s why you’ll see more development popping up in the East and further South.”

Suburban markets such as Buda, Kyle and Taylor, Texas, (future home to the Samsung Semiconductor Austin facility that’s set to be fully operational in 2024) offer the potential to create epicenters for retail, residential and quick-service restaurants. Those areas may not share the same lifestyle appeal as Music Lane or The Grove, but that’s currently where much of the development focus exists.