Southwest's Slowing Economy Offers Vital Breathing Space

DALLAS-A slowing economy is the breathing space that’s needed in southwestern US, where the 2000 office market in some cities is the best it’s been in three years. At least, that’s what cautiously optimistic, leading real estate executives are saying.

Job growth is at an all-time high, bringing with it an across-the-board booming office market, with construction down and absorption high in comparison to 1999 year-end statistics. Unless the economy bottoms out, they say a healthy balance will continue in 2001.

Austin has the highest occupancy and highest rents. “We’ve never had negative absorption,” says Walter Saad, Insignia/EST of Texas Inc.’s Austin regional director. He predicts absorption will hit two million sf when year-end calculations are complete. There’s been no hard fallout from failing dot-coms, six of which have gone belly up in recent months. “A vast majority of that space already has been backfilled,” he says.