AUSTIN, Texas—Even with nearly 750,000 square feet of office space under construction in downtown Austin, the area's occupancy rate is poised to increase under intense demand from tenants in a variety of industries.

"When all the buildings that are under construction deliver, the occupancy rate will actually go up, because of the preleasing in the buildings," said Charles Heimsath, president of Austin-based Capitol Market Research. "That may be an unprecedented situation and shows the tremendous strength of the...