By the numbers: Overall vacancy in Austin's downtown office market hit a new high of 22.3% in the third quarter of 2025, per the latest data available by the Downtown Austin Alliance.

What they're saying: Austin's downtown isn't failing — it's normalizing after years of outsized growth, Downtown Austin Alliance Senior VP Jenell Moffett.

• "Yes, we're in an uncomfortable space, but we're in transition," Moffett tells Axios. "There's billions of dollars of infrastructure that are being invested into the city and a lot of it centers in downtown."

The big picture: Austin's empty office spaces mirror national trends, despite a return-to-office push by many employers last year.

• 20.4% of office space in the country's top 50 metro is empty, per Moody's latest tally.

Zoom in: "The era of tech giants dominating entire buildings is fading, opening opportunities for a wider range of businesses to access downtown's prime location," per Downtown Austin Alliance's 2025 annual report.

Between the lines: Real estate brokerage firm Franklin Street, which found similar figures for downtown Austin vacancies, said the increase has also been driven by a sharp decline in venture capital deployment.

• Leasing at new buildings has not kept up, Franklin Street found in a November report.

Reality check: The vacancies mean that tenants can secure office space at a highly discounted price in a sought-after area.

• "Tenants have never had more leverage driven by the sudden increase in supply and demand compression," Alex Taghi, senior director of leasing for Franklin Street, said in a statement. "With increased options comes the ability to upgrade to newer properties that are now more economically viable."

What's next: Downtown leaders are exploring incentives to attract tenants.

• The alliance is beginning conversations around "affordable business" incentives, which could mean flexible leases, tax incentives, office activation programs and support for startups, incubators and small firms downtown, Moffett says.