Rare development site hits market in West Lake Hills

An aging office building in West Lake Hills is up for grabs, offering a rare redevelopment opportunity in one of Austin’s richest neighborhoods.

CBRE is marketing a 5.5-acre plot at 2224 Walsh Tarlton Lane in West Lake Hills. The land currently hosts a 40-year-old, two-story office building with a Chase Bank, marketing materials show.

The site is zoned for Limited Office usage, but a recent change to the land development code allows residential uses in those zoning districts. CBRE’s brochure includes a plan for a residential development on the site that would include 206 rentals across nearly 200,000 square feet.

Three active leases in the building cover 10,000 square feet. They bring in about $20,000 in monthly rental income, but the leases have landlord termination options.

As older, Class B office buildings have become less appealing in the return-to-office leasing landscape, their owners have been struggling to find uses for the assets. Some have considered converting them into housing, others opting for a teardown.

Few available development sites remain in the area. The parcel is less than a half mile from the Barton Creek Greenbelt, and sits within the Edwards Aquifer Recharge Zone. Just 11 other multifamily properties exist in the nearby school district’s boundaries, with only one built after 2015, according to CBRE.

Accordingly, the neighborhood has become one of Austin’s most exclusive: The average household earns $220,000, and the average home sale price is $2.8 million, according to Redfin.

The plot of land was most recently appraised at $5.2 million, but that is likely far less than it is actually worth, given the redevelopment potential.

Charles Cirar, Brad Bailey, Colin Cannata and Logan Reichle of CBRE are marketing the property. Cannata declined to comment on pricing.