Market Memo

Austin/San Antonio

A deep Texas expansion corridor where hyperscale demand and land are real, but ERCOT interconnection, power procurement, and water strategy decide which projects convert.

Gridlocked's directional read-through on this market's ability to convert AI infrastructure demand into buildable capacity.

Overall

Constraint

ERCOT congestion

Saturation

Medium

Executive Summary

Austin/San Antonio screens as one of the deeper expansion corridors in the Gridlocked universe. Microsoft is investing $1.4 billion across more than 1,100 acres in Medina County, Tract has assembled roughly 3,000 acres in Caldwell County targeting initial energization in 2028, and the metro has passed the New York Tri-State area in data center inventory with vacancy near 2% and new supply almost fully preleased. The constraint is the queue: ERCOT's large-load interconnection requests reached 233 gigawatts in late 2025 with under 2% operational, and CPS Energy alone holds roughly 26 gigawatts of data center requests — so delivered power, not announced demand, is the binding variable.

Market Scorecard

Overall

Power

Fiber

Land

Water

Policy

Demand

Saturation

Medium

0–100 directional Gridlocked framework scores. Higher means a stronger relative buildability signal, not guaranteed investment upside. Saturation is shown as a qualitative constraint signal.

Constraint Stack

Primary constraint

ERCOT congestion

Saturation risk

Medium

Demand is real, but competing load growth and power volatility complicate underwriting.

Saturation is a constraint signal — it reflects how much friction incremental growth faces, not whether the market is good or bad on its own.

Bull Case

If interconnection timelines hold, near-zero vacancy, heavily preleased supply, and named campus pipelines from Microsoft, Vantage, CyrusOne, and Tract can support a durable multi-year buildout, with new generation commitments from Vistra and NRG backstopping power supply.

Bear Case

Phantom queue load, interconnection rules still being written under SB 6, drought pressure on the Edwards Aquifer, and rising municipal scrutiny — San Marcos blocked a project in early 2026 — can stretch delivery windows and strand speculative land.

Real Estate Read-Through

Value is migrating from city cores to exurban counties — Caldwell, Medina, Milam — where large contiguous parcels with substation access screen at a premium. Sites without credible power and water strategies carry meaningful underwriting risk as municipal cooling and aquifer policies tighten.

Real Estate Market Data

Data center fundamentals

H2 2025 / Texas

CBRE North America Data Center Trends H1 2025 ↗

Inventory

412.5 MW

Vacancy

2.10%

8.8 MW available

Available

8.8 MW

Under Construction

462 MW

Preleased

97%

of capacity under construction

Net Available Pipeline

13.9 MW

Asking Rent Midpoint

$153

$/kW/month

Power Delivery Timeline

2030 or later

Primary Constraint

Power

Additional metrics

Net Absorption

78.4 MW

Asking Rent Low

$140

Asking Rent High

$165

Prior Period Rent Midpoint

$145

Rent Growth

5.20%

Secondary Constraint

Grid connection

Major Demand Driver

Hyperscaler

Key Takeaways

Vacancy is 2.10% with 8.8 MW available against 412.5 MW of inventory.

462 MW is under construction and 97% is preleased, leaving 13.9 MW of net available pipeline.

Developers focused on the northeast suburbs of Austin for available land served by Oncor; activity pushing south of Austin into Lower Colorado River Authority (LCRA) territory; three major operators completed fully preleased facilities.

Market surpassed New York Tri-State in inventory for first time since CBRE began tracking in 2016; Oncor and LCRA utility capacity constraints are the primary development bottleneck

Market data sourced from CBRE North America Data Center Trends H1 2025 inputs entered into Gridlocked's market data workbook.

Source ID: CBRE_H1_2025_001

Key Risks

ERCOT large-load queue attrition and SB 6 rule outcomes

Edwards Aquifer drought stages and municipal cooling policy

Municipal utility gatekeeping at Austin Energy and CPS Energy

Power price volatility across long development timelines

Local approval reversals following the San Marcos precedent

Public Market Read-Through

Public Exposure names that touch this market's constraint stack — potential beneficiaries and constrained exposures. Exposure can be positive, constrained, regulated, second-order, or mixed; this is read-through, not a buy list.

VST

Vistra

Vistra is a public-market expression of the power availability bottleneck through generation capacity and competitive power markets. If AI/data center load growth tightens power supply-demand balances, Vistra may benefit from higher power and capacity value. But this is market-sensitive exposure, not a simple infrastructure utility story.

NRG

NRG Energy

NRG is a mixed exposure to the AI power demand theme through retail electricity, generation, and power-market dynamics. Data center load growth can support broader electricity demand and market tightness, but NRG's read-through is less direct than a grid equipment supplier or data center operator. The Gridlocked question is whether higher load growth translates into durable economics after retail, hedging, regulatory, and commodity-market effects.

GEV

GE Vernova

GE Vernova sits close to the power infrastructure side of the AI buildout. It does not own data centers, but it provides generation, grid, and electrification solutions tied to the question of whether large-load demand can be served reliably. The exposure is meaningful because AI infrastructure ultimately needs generation capacity, grid equipment, and transmission reliability.

Data Status

Market memo content and scores are directional Gridlocked framework inputs based on public infrastructure, utility, site-control, water, demand, and saturation indicators. They are screening signals, not investment recommendations.