HPI is gearing up to roll out another phase at Hays Commerce Center, the 100-acre industrial park that hugs Interstate 35 in Kyle. The upcoming construction will carve out more flexible warehouse and small-bay suites aimed at smaller logistics firms, light manufacturers, and local distributors. It is the latest sign that the South Austin stretch of I-35 keeps pulling in industrial projects even as fresh space continues to hit the market.
As reported by Austin Business Journal, HPI plans to break ground on the next phase of Hays Commerce Center while actively marketing smaller, divisible suites to widen its tenant pool. In Justin Sayers' account, the developer is positioning the park to capture local operators that need mid-to-small bay footprints instead of a single big-box occupant.
Project footprint and recent deliveries
HPI's listings show that the campus already includes Hays Logistics Center 1 and 2 at 300 Vista Ridge Drive and Hays Commerce Center Buildings 3 and 4 at 301 Vista Ridge Drive, which together total several hundred thousand square feet of industrial product. According to HPI Real Estate Services, the company has delivered earlier phases and is now marketing smaller suites in its newest buildings.
Why Kyle keeps drawing developers
Kyle sits on the I-35 corridor about 20 miles south of downtown Austin, which gives tenants highway access without Austin's higher land and operating costs. Local economic development materials and nearby property listings highlight existing users, including a FedEx operation and recent relocations such as Redbird and ATX Specialty Foods, that point to steady demand at the campus. See Kyle Economic Development and GLP for details on the nearby logistics buildings.
Market context for builders and tenants
Austin's industrial pipeline has delivered large blocks of speculative space in recent years, and first-quarter 2026 market summaries show metro vacancy rising into the mid-teens as supply outpaces near-term demand. WareCRE's Q1 2026 recap, which aggregates broker reports across the market, notes elevated vacancy and a construction pipeline that is starting to contract, conditions that make smaller, divisible suites more attractive to developers who want to lease up quickly. That backdrop helps explain HPI's focus on mid-sized and subdivisible bays instead of building only large single-tenant warehouses.
What to watch
City records show that Hays Commerce Center is a long-running planned unit development with several pad sites still permitted for industrial use, a setup that could speed approvals for the new phase. The City of Kyle meeting packet contains zoning and PUD materials that explain why the project has advanced in stages. Watch for permit filings and lease announcements in the coming weeks to nail down a construction timetable and any early tenant commitments.
