San Antonio still has more vacant office space than before the pandemic
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San Antonio's office vacancy rate is hovering just above the national average, per data from Moody's.
Why it matters: The reliance on office space has drastically changed since the pandemic, with more people working remotely or only going into a workplace a couple times a week.
By the numbers: The office vacancy rate in San Antonio was 20.8% in the second quarter of 2024 — a nearly 5% increase from the 15.9% office vacancy rate the city had at the end of 2019, before the COVID pandemic hit.
The big picture: Nationally, office vacancy rates reached a record 20.1% in the second quarter — the highest since at least 1979, when Moody's began tracking.
Zoom out: The office vacancy rate increased the most in cities like San Francisco and Austin, as the tech industry continued to face cutbacks.
State of play: Long-term leases are taking a long time to unwind, says Moody's associate economist Nick Luettke.
- And these vacancy rates are likely to continue to climb for the next few years, peaking at the end of 2026, per Moody's projections.
Yes, but: There are reasons for optimism. A recent CoStar report projects San Antonio will lead the nation in office rent growth in the coming years.
Zoom in: The University of Texas at San Antonio announced this month it plans to purchase an 18-story office building, with nearly 265,000 square feet of space, that insurance giant USAA vacated at the end of 2022.
- It's part of the university's continued downtown expansion.
- UTSA is considering retail opportunities for the first floor.
The bottom line: Changes brought on by remote work continue to impact the future of downtown San Antonio.