Tishman Speyer Enters Austin With 240 KSF Office Buy
- Feb 05, 2021
Tishman Speyer has entered the Austin, Texas, market with the purchase of The Foundry, a two-building office asset totaling 240,000 square feet. Cielo Property Group sold the first building on Feb. 3, with the transfer of the second structure set to finalize in May upon delivery. According to Bloomberg, the transaction’s value was between $145 and $150 million.
The purchase comes alongside Tishman Speyer’s shift towards investment in tech-centered markets with a strong university presence, President & CEO Rob Speyer noted. The company has also grown its presence in San Diego, Boston and the Bay Area. In September, the developer won the bidding process for a 2 million-square-foot, mixed-use redevelopment of San Diego’s Tailgate Park. That project is expected to kick off in 2023.
Sixth River Architects designed Foundry I, located at 310 Comal St., which opened in 2019. Michael Hsu is the designer for Foundry II at 1600 E. Fourth St. The buildings were designed to achieve LEED Gold certification, and they offer amenities from fitness centers and outdoor terraces to underground parking. CBRE is marketing the asset to future tenants, and Cielo will oversee property management.
The Foundry is 2 miles from the Texas Capitol and 10 miles from Austin-Bergstrom International Airport. The asset is one block south of the Plaza Saltillo light rail station, enabling direct access through much of the city. The line recently expanded in October to include a station downtown alongside the Austin Convention Center.
Vice Chairman Mike McDonald and Managing Director Katy Jane Jenevein of Cushman & Wakefield represented the seller.
A booming market
Austin’s office sector continues to outperform larger markets, as its growth is being driven by big tech relocations and a robust construction pipeline. In December, the metro had more than 8 million square feet of office space underway, according to CommercialEdge, or 10.8 percent of completed stock.
The Texas capital’s office employment saw a 6.4 percent uptick year-over-year through November, despite the massive disruptions of 2020. Much of this growth can be attributed to the continuing trend of relocations from tech and finance firms.