2023 ANNUAL COMMUNITY GUIDE
183
UNDERSTANDING RENT
THINKING
LAKE TRAVIS
Business owners in the Lake Travis- Westlake area share what it is like to own and operate a business in the market.
LAKE TRAVIS
While retail rent seems to have gone down in southwestern Travis County since 2019, these gures are holistic and balance out the high and low prices seen in their respective areas.
STEINER RANCH BLVD.
71
620
BEE CAVE Capriotti's Sandwich Shop
360
71
Southwestern Travis County
$20 $22 $24 $26 $28 $30
“WHEN YOU ARE PROVIDING GREAT CULTURE AND A GREAT ENVIRONMENT, PEOPLE WANT TO WORK. MONEY ISN’T EVERYTHING; IT’S A CHUNK OF IT, BUT SO IS BEING HAPPY AT WORK.”
290
N
Julian King COURTESY JULIAN KING
LAKEWAY MorninGlory
“BREAKFAST RESTAURANTS ARE FEW AND FAR BETWEEN IN THIS AREA LAKEWAY . SO, I THINK IT’S APPEALING FOR US TO BE HERE, AND I’VE GOTTEN THAT IMPRESSION FROM PEOPLE.”
$0
Gabriel Chaparro COURTESY GABRIEL CHAPARRO
SOURCE: CBRE COMMUNITY IMPACT
SPICEWOOD Corrective Muscle Solutions
he said. A lack of coordination between these entities puts the burden on business own- ers and architects to navigate the process, he said. This can delay construc- tion and building deadlines if business owners do not know the permitting process in their city, he said. “I had one client who had no idea these di erent organi- zations [within the city] don’t talk to each other,” Gatlin said. In spite of any frustrations with the permitting process, Gatlin said there is “zero slow- down” in demand for com- mercial real estate in Lake Travis-Westlake. “I am not slowing down [as a permitting processor], and my services are in demand. I haven’t seen any slowdown for commercial in these areas, despite ination,” he said. Driving demand Even though small-busi- ness owners encounter obsta- cles when establishing roots in the area, demand in the Lake Travis-Westlake retail real estate market continues to grow, said John He ngton, IMPACT OF A December report from Goldman
Compared to 2021, the net amount of square feet leased in the third quarter of 2022 was less than the previous year, but quarter three saw an overall gain compared to 2020 and 2019. Another good indicator of market desirability is the occupancy rate, which is the amount of retail space leased, He ngton said. For south- western Travis County, the occupancy rate has steadily risen in the past year, rising from 95.3% in the second quarter of 2021 to 97.4% in the third quarter of 2022. “Typically as you see higher [net space leased], you see lower vacancies, and it’s sup- ply and demand. Generally as you see less vacancy, you see rents go up,” He ngton said. While rent has holistically gone down in the area for the past few years, according to the data, this is likely because some areas have lowered their rents in an attempt to ll vacancies, while other highly desired areas have continued to raise their rents, He ngton said. “What we’ve seen in
retail real estate agent and rst vice president for CBRE, a commercial real estate ser- vices rm. The amount of people vying for retail space has rebounded since the pandemic, and even with respect to seasonal varia- tion in the real estate market, Lake Travis-Westlake contin- ues to serve as a highly sought area for business owners to lease space, He ngton said. “When you look at where people choose to live in Austin, Westlake and Lake Travis are both extremely desirable areas, and … retail- ers always like to follow where their customer base is,” He ngton said. CBRE data breaks down by submarket, with southwest Travis County spanning from south of Lake Austin in the east to Spicewood in the west. The net space leased is the total amount of retail space put up for lease compared to the amount leased out. When more space is put up for lease than leased out, the market sees a positive number of net space leased, indicating mar- ket demand.
"WE HAVE EXPERIENCED A LOT OF ADVANTAGES IN THE LAKE TRAVIS AREA. WORD OF MOUTH HAS BEEN AN INCREDIBLE SOURCE OF BUSINESS GROWTH FOR US.”
Lauren Frost COURTESY LAUREN FROST
WESTLAKE Practical Fitness LLC
"WE LOVE SERVING WESTLAKE HILLS. NO COMPLAINTS. OUR BIGGEST CHALLENGE IS CONTINUING TO MAKE SURE INDIVIDUALS WITHIN 5 MILES FROM EACH STUDIO KNOW WE EXIST.”
Je Gotte COURTESY JEFF GOTTE
general with the neighbor- hoods and areas we’re talking about, we’ve actually seen rents increase,” He ngton said. “There’s probably a bit of [division] between the best retail centers and some of the smaller shopping centers, the centers that are unanchored or perhaps have greater age to them.” He ngton also said the Lake Travis and Westlake market is not slowing down and said places in the Hill Country Galleria and Lake- way are growing more rap- idly than Westlake. Several business owners also told Community Impact they wanted to stay in the
region. Frost said she and her hus- band have invested a lot of time in the Spicewood area and have built a reputation for Corrective Muscle Solutions. “Fortunately, the Spice- wood area has grown expo- nentially over the past few years. It’s created a lot of energy and momentum, and it’s an exciting time to be here,” she said. Lake Travis-Westlake will continue to attract prospec- tive business owners inter- ested in the region because of the type of clients who live in the area, He ngton said. “When you look at the amount of housing and the quality of housing being built out there, you are just going to continue to see quality prod- ucts and quality tenants look- ing to relocate in these areas,” he said.
INFLATION
of businesses said they raised prices compared to the previous year.
said pro tability has not met expectations.
52%
79%
Sachs’ 10,000 Small Businesses Voices surveying over 300 small businesses nationwide found businesses saw impacts of in ation in 2022.
said demand has decreased compared to the previous year.
believe larger retailers have an advantage due to ability to withstand in ation.
40%
84%
For more information, visit communityimpact.com.
SOURCE: GOLDMAN SACHS’ 10,000 SMALL BUSINESSES VOICES COMMUNITY IMPACT
31
LAKE TRAVIS WESTLAKE EDITION • JANUARY 2023
Powered by FlippingBook