The bottom line is rent will decrease this year. But, says Childers, "if rates rose $4 last year, it's not unreasonable to think it will drop $2, $3 per sf." He says the correction is positive and needed for the long term. "If rates had kept going at 16%, we would have priced ourselves out of the market. More and more international companies are looking to Austin as a place to do business," he says.

What will surely follow will be competitive rates, particularly in sublease space. But Austin property owners will still get "the highest rates in Texas" and tenants will gain in choice, according to Childers. Eight to 10 months ago, tenants had few choices and no leverage.

Foremost, the average rental rate is not stopping businesses from coming to town or expanding. "There's a healthy environment to do transactions ... that's what's happening down here," Childers says. "Some people have the misguided impression of what Austin is." Some have even questioned as to whether it's overbuilt. But, he quickly points out, the overall vacancy stands at 8.9%, an enviable position for any city.

In the CBD, rent rose 85 cents per sf in the past year, with the first-quarter average now standing at $30.90 per sf full service. Rates will become more competitive as more space delivers. But for now, vacancy is about 5%.

The strongest activity remains in the northwest submarket, which boasts the greatest amount of available sublease space. The average class-A rent in the far northwest is $28.12 per sf full service and $31.69 per sf in northwest proper. It had been $25.27 and $27.93, respectively, just last year. Both sides of the street are focused on "getting deals done as quickly as possible," says Childers. "Deals are getting done out there and will continue to get done out there." The northwest, the favored landing spot for high-tech tenants, has an 8% vacancy and the far northwest, 14.7%.

In the southwest submarket, vacancy is riding at 6.4%. Class-A rates are $28.17 per sf full service in comparison to last year's $25.84 per sf. It's tight and it's going to stay that way since most of the up and coming construction is been pre-leased, he says.

In a total office inventory of 26.5 million sf, even the vast amount of sublease space doesn't appear to be at critical mass, despite some brokers' concerns and published accounts that the bottom's falling out of the city. Colliers places sublease space at 1.2 million sf while Buls-Hodge Consulting has it at 1.89 million sf. What the brokerage community is saying is that it's all in the calculation, some firms' stats lag behind today's reality and others include space that has yet to be vacated.