Adaptive Mixed-Use Buildings for Sale on Austin’s Famed Congress Avenue

Thursday, June 6, 2019

HFF, on behalf of the owner, is marketing two adaptive mixed-use buildings totaling nearly 58,000 square feet on the famed Congress Avenue in Austin, Texas. The buildings comprise 327 and 506 Congress Avenue and are being offered as a portfolio or as individual listings.

Both office buildings for sale boast a prime location in downtown Austin. 327 and 506 Congress are steps away from the State Capitol building in an infill location within a historical district in Downtown Austin. With limited developable land and high barriers to entry around Congress, the properties benefit from a lack of future competition. Downtown Austin is home to more than 90,000 daytime employees and a growing residential base of more than 14,000 people. With an influx of apartment, condominium, retail and office developments, the downtown core has transformed Austin into a 24-hour city. Downtown Austin remains the city's entertainment nexus and boasts the largest density of bars and restaurants in Austin. Residents and visitors alike have many different districts and areas from which to choose, all with different characteristics, including Sixth Street, 2nd Street, Rainey Street and the East Side. 327 and 506 Congress are also a short walk to Austin’s best natural amenities, including the Butler Hike and Bike Trail, Auditorium Shores, Zilker Park and bat viewing on Congress Avenue Bridge.

Both properties benefit from strong submarket fundamentals. Downtown hosts an impressive roster of employers, including the Whole Foods world headquarters, Google, Expedia, Parsley Energy, Facebook, Indeed, Cirrus Logic and countless law, engineering, government, real estate and high-tech companies. With occupancy of 94.3%, Downtown office owners benefit from the limited threat of new construction and rising rental rates from an increasingly tight market. With Downtown Austin’s scarcity of available land, demand is far exceeding supply with positive absorption eight of the last nine years. The Downtown Retail submarket is currently 97% leased with occupancy never having dipped below 94% going back to 2007. With limited available space, the submarket has experienced eight consecutive years of rent growth.

327 Congress Investment Highlights

  • Trophy Mixed-Use Asset with Redevelopment Opportunity:  The 36,097-square-foot property is a one-of-a-kind mixed-use building along Congress Avenue surrounded by some of downtown’s most popular demand drivers. 327 Congress’ unique positioning on the corner of a city block allows for additional frontage along 4th Street and provides investors the opportunity to pursue potential re-development opportunities. With the continued improvement of Congress Avenue’s walkability, investors have the option to turn the front parking spaces into a street patio, further enlivening the district and driving traffic to the property’s ground-floor retail. 327 Congress is one of the few office buildings on Congress Avenue with parking available on site for tenants. This amenity serves as a differentiator for tenants looking to office on Congress and allows for potential transient revenue on the weekends.
  • Diversified Rent Roll:  327 Congress is currently 100% leased to a diverse rent roll of 10 office tenants and FedEx, which occupies the ground-floor retail space. With approximately 6,000-square-foot floor plates and flexible tenancy, investors have optionality when re-leasing vacant space.

506 Congress Investment Highlights

  • State-of-the-Art Mixed-Use Asset with Redevelopment Opportunity:  506 Congress is a unique mixed-use building along Congress Avenue that is surrounded by some of Downtown Austin’s most popular demand drivers. The 21,776-square-foot building’s prominent positioning between 5th and 6th Streets provides investors the opportunity to pursue potential re-development opportunities. 506 Congress is zoned “CBD,” which has no use restrictions or parking requirements. The favorable zoning, 25:1 floor-area ratio along with the property not being in the Capitol View Corridor allows investors the ability to maximize density. With the continued improvement of Congress Avenue’s walkability, investors have the option to turn the front parking spaces into a street patio, further enlivening the district and driving traffic to the property’s ground floor retail. Renovated in 2008, 506 Congress, which is is 100% leased to Broadway Bank, Edelman and Thirteen 23, features state-of-the-art office space with modern finishes, fitness center and a fourth-floor rooftop deck providing Downtown Austin skyline views. 

327 and 506 Congress’ unrivaled location, value-add potential and proximity to Austin’s main demand drivers combine to make these properties two of the most compelling mixed-use offerings in the United States. For more information on this commercial real estate listing, please contact Cathy Nabours or Walter Saad in HFF’s Austin office. To view HFF’s current real estate investment listings, please click here to be directed to HFF’s property search page.

Holliday GP Corp. ("HFF") is a Texas licensed real estate broker.

By Topics