Austin’s industrial market saw immense leasing activity in 2023, with several large leases inked across new speculative developments. The top five largest leases of the year totaled over 1.6 million square feet, indicative of Austin’s rapidly growing logistics and manufacturing sectors. Preleases accounted for 51.6% of this 1.6 million square feet, showing the large demand for new industrial space in Austin.
Major companies like Tesla, Reynolds, and Four Hands committed to large blocks of space to facilitate their operations and expansions in the metro area.
Largest Austin Area Industrial Leases in 2023
1. Tesla
Tesla, an automotive and clean energy company, signed a lease for 961,877 square feet at Kyle35 Logistics Park in 3Q 2023. Tesla is leasing the entirety of Building 2 at Kyle35. This is one of many leases Tesla has signed just south of Austin since the company moved its headquarters to the city in 2021.
While Tesla has over ten million square feet of industrial space in the Austin area alone, this is its first industrial space in Kyle.
2. HBPO
HBPO, a French electrical vehicle supplier, signed a lease for 343,200 square feet at Northeast Crossing Building 4 in 2Q 2023. The move to this location will create roughly 800 jobs in the area.
It is widely reported that the move to this location was motivated by Tesla, as HBPO is set to provide them with plastic materials for their cars.
3. US Farathane
US Farathane, a designer and manufacturer of plastic injection-molded components, signed a lease for 262,874 square feet at GTX Logistics Park in 3Q 2023.
US Farathane is the first tenant at GTX Logistics Park, a five-building industrial park that will offer over 3 million square feet after the final phase’s completion.
4. Four Hands
Four Hands, a global furniture designer and wholesaler, signed a lease for 181,660 square feet in Park 35 Phase II in 4Q 2023. Upon completion, four Hands will occupy the entire second building of Park 35 Phase II.
Four Hands’ move into Park 35 Phase II will add to their existing 730,000 square feet of warehouse space in the area.
5. Spec’s Wine, Spirits, & Finer Foods
Spec’s Wine, Spirits, & Finer Foods, a Houston-based family-owned liquor chain, signed a new lease for 160,327 square feet at Park 183 South Industrial Park in Austin, Texas. This lease encompasses all of Building 6 in the industrial park.
The company, which has been expanding rapidly across the state, signed the lease in 1Q 2023 and moved into the building in August 2023.
Conclusion
This was a banner year for Austin’s industrial sector, with occupiers signing leases for over 2.2 million square feet across the top five deals alone. This activity highlights the strength of Austin’s economy and its emergence as a magnet for companies in industries like EVs, logistics, and manufacturing.
With millions more square feet planned or under construction across the metro, Austin is poised for even stronger industrial leasing momentum in 2024 and beyond. The above top leases of 2023 represent some of the most significant commitments by major corporations that will shape Austin’s industrial landscape for years to come.
