The St. Elmo area, south of Austin’s city center, has started to pique the interest of developers, tenants and shoppers alike. What was mostly industrial space five years ago is now an up-and-coming shopping, eating and entertainment district with plenty of nearby housing options and commercial developments to match.

If you have been wondering where the next development boom in Austin might happen, this could be it. With over 1.4 million sf of commercial projects proposed and under construction in the area, St. Elmo is growing fast. In this report, we take a look at the St. Elmo micromarket, including:

  • The St. Elmo area, past and present
  • What is drawing development to the area?
  • Future outlook for the neighborhood
  • Why tenants and developers should be interested


St. Elmo, Past and Present

Before we can begin to discuss the St. Elmo area, we first have to define what its boundaries are. In the strictest sense, the area’s boundaries are Highway 71 to the north, IH-35 to the east, South Congress Avenue to the west and East St. Elmo Road to the south. These boundaries are where most of the newest developments are occurring today and where the majority of investment interest is taking place.

That said, there are a number of developments in the works further to the south of the “core” St. Elmo area that we feel have an influence on the St. Elmo micromarket, so we will be including those as well.

St. Elmo Area Map

The St. Elmo Micromarket


St. Elmo Micromarket Overview

Historically, the St. Elmo micromarket has not been a place someone would think about spending a Saturday afternoon. Aside from employees working in its industrial spaces or residents living in the area, there was no obvious reason for why someone would be there other than to visit Music Lab, a building full of rehearsal studios for local bands to practice that was the only non-industrial building in the area for some time.

Part of the reason is that over the past half-decade the St. Elmo micromarket has been fairly stagnant as far as new development is concerned. Five years ago, the micromarket was comprised of 1.6 million square feet (sf) of industrial space, 3,200 multi-family units, 187,000 sf of office space and roughly 1,000 single-family houses.1 The vast majority of industrial development took place before the 2000s, and only two apartment complexes would have been considered “new” in 2014; nearly all of them were built prior to 2008. Of the office buildings, none would have been considered Class A and nearly all were less than 20,000 sf and single story.

However, a lot has changed in five years, and today the St. Elmo area is starting to show signs of growth. While the area is still very much in the early stages of redevelopment and is likely years away from seeing the same success as markets like Austin’s Eastside, it can already be hard to find parking on a Saturday afternoon due to the influx of visitors to the area.


Projects Built, Underway and Nearing Completion

Today the St. Elmo micromarket is becoming a hub for new development, offering affordable space options close to Austin’s downtown. Through a mix of ground-up development and the redevelopment of existing buildings, over 1,000 multi-family units and 200,000 sf of commercial space have been delivered since 2016.

The Yard, which is responsible for the majority of commercial space delivered to this point, was a renovation of existing warehouses into retail and “maker” spaces marketed to “community-minded companies, makers, social entrepreneurs and all sorts of hard-working folks.”2 The project has already leased most of its available space to its target tenant type, with companies like the Austin Winery and Eco Roof & Solar calling The Yard home.

The Yard Site Map | St. Elmo Austin

The Yard Site Map

The Austin Winery at The Yard | St. Elmo Austin

The Austin Winery at The Yard

Following the success of The Yard, the Public Lofts condos was the first major ground-up multi-family development in the heart of the St. Elmo micromarket, delivering 217 units in 2018. The success of this development helped prove that people would not only visit a newly revitalized St. Elmo, but would live there as well.

As for projects currently under construction and proposed, there are a number of noteworthy developments underway that are expected to have a significant impact on the micromarket as a whole. For starters, the St. Elmo public market is a mixed-use project promising office, hotel, residential and retail space, including, as its name suggests, an indoor market where vendors and restaurants will be able to lease space and sell their wares. First announced in 2015, the project experienced some delays, but developers in the area confirm that the market is now moving forward and has already leased some of its market space. The office portion, St. Elmo Plaza, is expected to deliver 105,000 sf of space in the future, and the multi-family portion is said to be breaking ground in Q1 2020.

St. Elmo Plaza Rendering

St. Elmo Plaza Rendering (Source: CoStar)

Additional multi-family units are also in the pipeline, with roughly 1,100 units currently under construction and an additional 385 proposed. While not ready to be made public, we also have it under good authority that several office projects could soon be added to this list as well.

St. Elmo Development Pipeline Map

Projects Delivered 2016-Present

Title Product Type Address SF/Units Status Delivery Date
TwoTwenty South Office 222 Industrial Boulevard 22,750 Renovated 2016
Ten-O-Five Flex 1005 St. Elmo 59,674 Ground Up Construction 2018
The Public Lofts Condo 4361 S Congress Ave 217 Ground Up Construction 2018
The Yard Retail/Warehouse 444 St. Elmo 141,175 Renovated 2016
James on South First Multi-Family 8800 S 1st St 250 Ground Up Construction 2016
Skybridge Lofts Multi-Family 604 N Bluff Dr 112 Ground Up Construction 2017
Urban Oaks Multi-Family 6725 Circle S Rd 135 Ground Up Construction 2017
Sur 512 Multi-Family 5010 S Congress Ave 352 Ground Up Construction 2016

Total Multi-Family Units Delivered: 1,066 Units | Total Commercial SF Delivered: 223,599 SF


Proposed & Under Construction

Title Product Type Address SF/Units Status Delivery Date
SoCo 44 Multi-Family 4401 S Congress 275 Under Construction 2020
Society Apartments Multi-Family 6001 S Congress 262 Under Construction 2019
Foremost Multi-Family 135 Foremost Dr 300 Under Construction 2019
St. Elmo Public Market Retail 4329 S Congress 24,000 Under Construction 2020
The Knoll at South Congress Multi-Family 8121 S Congress 308 Under Construction 2020
Public Market Apartments Multi-Family 4329 S Congress 385 Proposed 2020
St. Elmo Plaza Office Office 4329 S Congress 105,000 Proposed 2021
Aloft Hotel Hospitality 4108 S IH 35 135 Under Construction 2020

Total Multi-Family Units To Be Built: 1,530 Units | Total Commercial SF To Be Built: 129,000 SF


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What is Drawing Development to the St. Elmo Area in Austin?

Clearly, the St. Elmo micromarket is beginning to share in the development activity that has been going on in the rest of Austin, but that does leave us asking the question, why St. Elmo?


St. Elmo is located in a prime confluence of the most important arteries of transportation in Austin. South Congress Avenue, IH-35 and Highway 71 all offer easy access to most of the city, and the concentration of numerous, relatively affordable housing options in the area means employees should not have to drive far to get to work.

Due to its proximity to US-290, St. Elmo also offers better access for executives living in west Austin than other comparable markets, such as the Eastside.

St. Elmo Drive Time Location Aerial Map


Comparing St. Elmo to other relatively new office markets in Austin, namely the Domain and the Eastside, we see that the population surrounding the St. Elmo micromarket shares many similarities.

2018 Working Age Population 2018 Bachelor’s Degree 2018 Millennial Population (%)
3 Mile 5 Mile 3 Mile 5 Mile  3 Mile 5 Mile 
St. Elmo Submarket 112,610 230,831 27.04% 29.06% 37.54% 37.68%
The Domain 83,005 207,078 32.54% 30.50% 35.58% 32.70%
East Austin (Plaza Saltillo) 129,493 242,225 33.25% 31.65% 45.77% 40.74%


2018 Total Population YOY Population Growth
2018 Median
Household Income
3 Mile 5 Mile 3 Mile 5 Mile 3 Mile 5 Mile
St. Elmo Submarket 166,671 340,951 2.09% 2.49% $45,812 $52,426
The Domain 121,765 311,839 1.51% 1.83% $61,086 $60,403
East Austin (Plaza Saltillo) 183,263 352,711 2.83% 2.27% $43,329 $47,182

St. Elmo has no shortage of potential employees, with a working-age population of 112,610 within three miles compared to 83,005 for the Domain and 129,493 for East Austin. This population is also educated, with 27% having attained a Bachelor’s degree compared to 32% and 33% at the Domain and East Austin, respectively.

Another useful indicator of the health of the St. Elmo area is the population growth between 2016 and 2018. At 2.5% year-over-year growth within a five-mile radius, St. Elmo is not only attracting residents to occupy its multi-family projects, but is outpacing both the Domain and East Austin as well.

The Last Frontier

Perhaps most importantly, a quick look at the map of Austin will tell you that the St. Elmo area is one of the last available options near downtown for a developer to consider. Austin’s CBD is very densely developed (not to mention requires significant capital to build in), the Eastside is already being heavily developed, the western edge is constrained by residential properties and the north has a major mixed-use project of its own, the Highland Mall development.

For a developer wanting to invest in the Austin market, St. Elmo could be an enticing place to look.


Future Outlook for St. Elmo and Austin

But what potential does the St. Elmo micromarket hold 10 years down the road? How much development could we actually expect to see?

To answer those questions, let’s take a look at the area’s current zoning to see what is possible and what could be possible with a few changes.

Today, the core area of the St. Elmo micromarket is mostly zoned limited industrial (LI). Not only does this restrict the type of development that can be undertaken, but a floor area ratio (FAR) of 1:1 means a building cannot have more square feet than that of its lot. For reference, the FAR of Austin’s CBD zoning is 8:1 (with density bonuses allowing up to 25:1), meaning eight times more space can be built on the same size lot. Due to rising land and construction costs, the FAR is a vital metric for developers looking to maximize the amount of space they can build on a given piece of land.

Assuming that the highest and best use for the area would be to transition from industrial space to retail, multi-family and office space, a more optimal zoning profile for the area would be General Commercial Services (CS). With this zoning, the FAR is increased to 2:1 and the allowable uses are better suited to these types of projects. The City of Austin has historically been open to changing zoning from LI to CS for aesthetic and environmental reasons, so it’s not entirely outside the realm of possibility.

St. Elmo Zoning Map

Taking into account recently developed projects, long-term leases, ownership groups and a variety of other factors, we estimate that there are roughly 64 acres of land that could potentially be available for commercial development in the foreseeable future. With this number in mind, and using the square feet of development per acre at both the Domain and Eastside as benchmarks, this means roughly 900,000 sf of retail, multi-family and office space could yet still be developed in the St. Elmo micromarket. For comparison, Domain 8 in Austin’s “second downtown” is roughly 300,000 sf.

Acres  SF Commercial SF per Acre
Eastside 3,993 13,269,771 3,323
The Domain 373 9,218,937 24,716
Average 14,019
Acres Potential SF Commercial
St. Elmo 64 899,208

If this number seems high, it’s important to remember that Austin’s Eastside had only 9.5 million sf of commercial space in 2014, which means 3.7 million sf was developed in the last five years alone. This was also despite much of the development on the Eastside taking place next to and in between single-family homes, which triggers compatibility setbacks and generally limits how much a developer can build, an issue that the St. Elmo area won’t have to face. If a similar development boom kicks off in the St. Elmo micromarket, 900,000 sf could be on the low end.

What this means for…


For a tenant intrigued by East Austin’s ambiance but unwilling to pay the rental rates that come with it, St. Elmo could present a cheaper and equally hip alternative. Not only do new developments give tenants the chance to work with the developer to make the space truly unique, but getting in at the “ground floor” of an up and coming area means initial tenants will have a considerable impact on the culture and image that the St. Elmo micromarket develops. This, mixed with the area’s access to transportation corridors and demographic characteristics, make St. Elmo a great option for tenants.


Similarly for developers, St. Elmo is essentially a blank slate ripe with possibilities. It has enough space to pursue a large mixed-use development, yet could also be suitable for a one-off office or multi-family project. While it’s important to remember that most of the sites will require a zoning change, a developer willing to take the time and energy to navigate the rezoning process will likely be rewarded with a higher FAR and unlock more potential for their investment.

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1Source: CoStar and Esri

2Source: The Yard Austin

Kirk Silas | AQUILA Commercial

Kirk Silas

Kirk is the mastermind behind AQUILA's wealth of market intel. He continuously delves into data and crunches the numbers to provide our team and our clients with the latest market insights and most in-depth analysis.

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