Formula 1 race could rev up Austin’s commercial real estate
Dec 5, 2012
The inaugural Formula 1 race at the new Circuit of the Americas racetrack in Austin was a great success. More than 65,000 spectators showed up the day before the race to watch the drivers practice, and more than 117,000 turned out for race day. Spectators poured into Austin from across the U.S. and around the world. Austin’s transportation infrastructure handled the influx of fans with no major issues, and three more events are already scheduled for the track, including a Moto GP motorcycle race.
The success of the first F1 race in America since 2007 is obviously good news for Austin, though we’ll have to wait to tally the true economic impact of the race. But there are two major takeaways from the event that are of particular interest to commercial real estate investors and developers. Here’s what we can learn from the Circuit of the Americas:
- Austin builds quickly. Plans to build the track were announced in the summer of 2010. Just over two years later, even despite a contract dispute that halted construction, the $400 million facility was completed in time to host its inaugural race. Upgrades to transportation infrastructure around the track were also completed to handle the hundreds of thousands of fans in attendance.
- The track needs to mature. Everyone and their brother are trying to sell real estate near the Circuit of the Americas, but right now no one is buying because investors are waiting to see how the track will perform in the future. Once year-round use of the track kicks in, we’ll likely see more commercial development and investment in the surrounding areas to complement the racetrack with retail properties, for example. We could see more interest in the surrounding real estate by the time the F1 series roars back into Austin from Nov. 15-17, 2013.
Leading up to the race, everyone in Austin was collectively holding their breath, afraid of traffic snarls and other complications. But the success of the race this year could create momentum for the Circuit of the Americas. The beauty of the race track is not only the tourism business it drew this year, but the potential for continuing returns on this investment as it becomes an entertainment hub for Austin.
Posted by: Randy Williams