The 3 ways Austin tech companies find great offices

by Colin Morris
November 10, 2015
 
 
We all know Austin is one of the hottest places on the planet to launch your startup. But if you survive long enough to hire employees, you’re going to need somewhere to put them. Turns out finding office space for your tech company introduces your business to a whole new level of competition.
 
That’s where commercial realtors come in.
 
Justin Bayne is one of the many real estate agents keeping busy amidst the city’s boom. He and fellow Austin native Chris Skyles founded SkylesBayne, which represents tenants across industries from tech to entertainment.
 
If you’re looking for office space — or even think you might in the future — you’ll need to know what you’re up against.
 
We sat down with Bayne to get the lay of the land.
 
Read on for the top three pieces of advice he gave us to find the right place at the right price.
 
 

3. Be smart

Especially if you’re new to Austin’s real estate market, it helps to understand why space is so scarce, even in a state as big as Texas.
 
Bayne said one of those reasons is Austin’s land use restrictions.
 
“We nearly treat trees in Austin like they’re people,” he said. “Everybody like trees, but … the regulatory process of building a building in Austin is as difficult as it would be in San Francisco.”
 
In addition to its strict rules about building design, materials and use, the city of Austin is situated on an aquifer recharge zone.
 
That term refers to a natural filtration system created by limestone deposits from Austin’s prehistoric past. As water from the Rockies runs over the Edwards Plateau and down through the Hill Country west of downtown on its way to the Gulf of Mexico, it passes over a fault line that exposes the aquifer to groundwater.
 
To protect this delicate ecosystem, the city of Austin tries to keep its terrain porous, limiting impervious cover like buildings and driveways to 10 percent of every developed acre in some areas to the west of downtown.
 
Do your research on these subjects if you want to understand which areas are bordered by the least red tape, especially if you plan to build your own office.
 

2. Be creative

Downtown is crowded. While the tech community is buzzing there, Bayne said the Central Business District is nearly 100 percent leased, with few blocks left to build on.
 
Meanwhile, most millennials don’t want to ride an elevator to an office designed in the 80s with drop ceilings and private offices hogging all the windows.
 
So if you want to attract young talent with a trendy, open atmosphere, plan to expand your search along the lines of Austin’s sprawl. The Domain on the city's northwest side has established itself as a secondary CBD, and there's more room to work with. There's also relatively affordable housing nearby.
 
Likewise, Bayne (pictured right) pointed to the area immediately east of downtown as an opportunity for redevelopment with fewer land use restrictions.
 
“If you look at a map of Austin, it looks like someone squeezed a tomato, and it squirted out in all these directions,” Bayne said, referring to Austin’s patchwork of policies on urban sprawl over the years. “I see a big desire to convert older buildings just outside downtown. A bunch of buildings get leased before their rehab is even done.”
 
Getting creative with old spaces is something Bayne knows a lot about.
 
When Adlucent was looking for space just south of SoCo, Bayne found them an old movie theater (pictured above) and converted it into office space.
 
They’ve already outgrown it, and Bayne is in the process of finding their next home. There’s no reason to assume big companies can’t be creative too, though. Consider the cavernous Seaholm Power Plant, which was renovated for athenahealth’s Austin offices.
 
The lesson here is that cool offices come in all shapes and sizes, so keep an open mind.
 

1. Be patient

Bayne estimates the process of finding the right office takes about nine months to do properly, and there are several reasons to start your search early.
 
For one thing, tech companies can shrink and grow quickly, causing sudden turnover in real estate. The company occupying your dream office might be a funding round away from a hiring spree, so keep your eyes peeled for opportunities.
 
Another reason to plan ahead is that few offices come ready to use the day you get the keys. Most require some construction for changing windows, carpets and other configurations, all of which Bayne says takes extra time in Austin. 
 
Finally, and maybe most important of all: The more time you have to make a deal, the better you can negotiate.
 
“We try to have two or three landlords compete for a tenant,” Bayne said. “But if you don’t have any time and you just have to get into a space, you’re leaving a lot of value on the table.”
 
If all of this sounds like a full-time job, that’s because it is.
 
“It’s not a CEO’s job to sit around and think of places to move,” he said.
 
Photos courtesy of SkylesBayne and Adlucent.

Jobs at SkylesBayne

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