We saw some overbuilding here in the 1980's when I was in high school. In about 1985 or so, we started a rut in which there were huge amounts of empty office space. At the time, Austin was a town with small business, Gov't and University jobs, and oil money was good. Then oil went south (hard to believe today, I know...) The result was hard times here. Today, several key elements are different:
1) Bank Lending: Nowadays, there is a lender on every corner, and most of them have a big presence-even national. Part of the big runup back in the 1980's was all that oil money sitting in banks. Bankers were chasing projects, looking for a place to loan. Since all the banks were local, the money stayed local. Nowadays, if you are a millionaire and you deposit in Citibank, B of A, or another bank like that, they may loan out that money in Dallas, Nashville, Seattle, or whereever they do business. Banking has diversified that way.
2) Diversification: Put simply, city and business leaders have gotten smarter about putting all their eggs in one basket. In the 1990's we were all tech. Then tech busted. So we began to think outside the box. Things like "Opportunity Austin" got started.
3) TV shows glamourized downtown living. You've seen them. "Friends," "Will & Grace," "Frasier," "Sex and the City." The list goes on and on. Todays yuppies and young folks are plugged in and intrigued by the prospect of downtown living. It's "cool." It also works for the "Green" crowd, and my gosh, with gas prices seeing no end in site, I may sell the ranch and buy a condo myself!!
Austin is not immune to a slow down, but we are in much better position than we were in the last two decades. In addition, we haven't had a bubble swelling and ready to burst like other parts of the country.