To open a daycare or childcare center in Austin, you need a space that meets Texas licensing rules (at least 30 square feet of indoor activity space per licensed child and 80 square feet of outdoor play space per child outside at one time), sits on a property where child care is a permitted use, and has safe, easy drop-off for parents. The best sites are usually freestanding buildings or end-of-center retail spaces near growing family neighborhoods, with room for a fenced play yard next to the building.
This guide covers how to size the space, where to look, what to check in the building, and the lease terms that matter most. It is general information, not legal advice. Confirm licensing details with Texas Health and Human Services (HHSC) Child Care Regulation and permitted use with the city that has jurisdiction over the site.
How much space does a childcare center need in Texas?
Start with your target capacity, then work backward. Texas minimum standards for licensed child-care centers set two space floors:
- Indoor activity space: at least 30 square feet for each child the center is licensed to serve.
- Outdoor activity space: 80 square feet for each child using the outdoor area at one time, and enough outdoor area to equal at least 25% of your licensed indoor capacity.
For example, a center licensed for 100 children needs at least 3,000 square feet of indoor activity space. Outdoors, the 25% test means room for at least 25 children at once, or 2,000 square feet, and more if you plan to send larger groups out together.
Activity space is only part of the building. Add classroom storage, offices, a kitchen or food prep area, staff space, restrooms and diapering areas, and hallways. Have an architect test-fit each finalist space against your classroom plan before you sign a letter of intent, and remember that leases are quoted in rentable square feet, which is larger than the area you can actually use.
Where should you open a daycare in the Austin area?
Childcare demand follows young families, so start with demographics rather than listings. Pull a free demographic report for each candidate site and compare households with children under five, household income, and growth within a short drive.
- Growing suburbs. New subdivisions in Pflugerville, Hutto, Round Rock, Cedar Park, Georgetown, and Kyle and Buda add young families quickly, and supply does not always keep up.
- Commute routes. Parents choose care on the way to work. A site on the morning commute side of the road, near a neighborhood entrance or a major employer, makes drop-off simple.
- Central Austin. Closer-in neighborhoods such as South Austin and East Austin have strong demand but fewer sites with room for a play yard, so expect to look harder and pay more per square foot.
Map existing centers in each trade area too. A corridor with several centers is not automatically a pass, but you should know who is there and what ages they serve.
Retail center, freestanding building, or something else?
| Option | Strengths | Watch for |
|---|---|---|
| Freestanding building | Own yard, own parking, simple drop-off | Higher rent or purchase price; may need a full renovation |
| Retail endcap or pad site | Visibility, parking, room to fence an adjacent area | Landlord and other tenants may restrict child care; play yard space is often the deciding factor |
| Office or flex building | Larger floor plates, sometimes lower rent | Ground-floor space and outdoor area are harder to find |
| Former school, church, or daycare | Layout, restrooms, and yard may already fit | Older systems; confirm the existing approvals still apply to your use |
A former childcare center is the closest thing to second-generation space for this use and can save months of buildout. Our retail and specialty property pages cover how these property types are usually priced and leased.
Is childcare allowed by zoning in Austin?
In the City of Austin, child care can be provided as a primary use in most zoning districts. Austin City Council expanded where centers are allowed in October 2023, adding about 77,000 acres open to commercial child care centers, removing on-site parking requirements for them, and allowing child care as an accessory use in residential areas. Centers in industrial areas still need a conditional use permit.
“Most districts” is not every address. Conditional overlays, neighborhood plans, and private deed restrictions can still block the use, and suburban cities such as Round Rock and Pflugerville have their own codes. Confirm permitted use for the specific property, and make the lease contingent on it. See the glossary entry on zoning for the basics.
What permits does a daycare need before it opens?
Plan for three tracks running together:
- City permits. If you move into an existing building with a different use, Austin treats it as a change of use: you need an approved site plan or exemption, approved building plans, permits, and passed inspections, which result in an updated certificate of occupancy. Fire inspections follow.
- State licensing. Texas HHSC requires a Licensed Center Orientation class, then an application with a Plan of Operation and background checks. After the application is accepted, HHSC inspects the operation and issues an initial license once it meets minimum standards.
- Local fire and sanitation inspections. HHSC notes that local authorities may require zoning, building code, and other location requirements to be met before they perform fire and sanitation inspections.
Because HHSC inspects the real building, the space has to be built out before the license is issued. That makes the timeline, and who carries rent during it, a central lease issue.
What should you check in the building itself?
Childcare has more demanding requirements than most retail or office tenants. Screen for these before touring seriously:
- Ground-floor rooms and exits. Building codes treat care for infants and toddlers more strictly than care for older children, and rooms for the youngest children often need to be on the ground floor with exits directly outside. Ask your architect to confirm the occupancy classification with the building official early.
- Fire protection. A change to child care can trigger fire alarm, sprinkler, or exit upgrades. Price these before you agree to a tenant improvement allowance.
- Plumbing. Child-height toilets and sinks in or near classrooms, diapering stations, and a food prep area all depend on where the sewer lines run.
- The play yard. It should sit next to the building, away from traffic and drive aisles, with room for fencing, shade, and safe surfacing. Texas allows off-site outdoor space only with an HHSC-approved plan and a safe route.
- Drop-off and parking. Austin no longer requires on-site parking for child care, but parents still need it. Look for a pull-through or short-term parking near the entrance and enough spaces for morning and afternoon peaks.
- Accessibility. Texas Accessibility Standards apply to the building and the route to the play area.
Lease terms that matter most for a childcare center
- Permitted use and contingencies. Spell out child care as the permitted use, and make the lease contingent on zoning, building permits, and the certificate of occupancy.
- Rent commencement. Tie it to permits and opening, not to lease signing. Free or reduced rent during buildout and licensing is common to negotiate.
- Outdoor area. Put the play yard, fencing rights, and its exact location on an exhibit to the lease.
- Exclusive use and restrictions. Ask for an exclusive on child care in the center, and check that no existing tenant or recorded restriction blocks your use.
- Term and renewals. Buildout is expensive, so negotiate a term long enough to recover it, plus renewal options.
- Assignment. If you might sell the center or join a larger operator later, negotiate the right to assign the lease to a buyer.
- Operating costs. Most retail space is quoted on a triple net basis. Read our guide to NNN and CAM charges and model the total cost with the lease cost calculator.
Our guide to commercial lease terms that matter covers each of these in more depth.
Get help finding childcare space in Austin
Austin Commercial Sites is the Austin team of Foresite Commercial Real Estate, and Tristen Palori is a licensed Texas commercial real estate agent. Through our tenant representation, we pull demographics for each trade area, screen sites for permitted use and play yard room, and negotiate the lease, usually at no cost to you because the landlord pays the fee. Contact us to start with a short list of sites that fit.
Sources
- 26 Tex. Admin. Code § 746.4201, Indoor Activity Space, Texas Administrative Code (via Cornell LII), accessed October 2026
- 26 Tex. Admin. Code § 746.4301, Outdoor Activity Space, Texas Administrative Code (via Cornell LII), accessed October 2026
- 26 Tex. Admin. Code § 746.4311, Outdoor Space Not Connected to the Center, Texas Administrative Code (via Cornell LII), accessed October 2026
- Become a Child Care Center-Based Provider, Texas Health and Human Services Commission, accessed October 2026
- Adult and Child Care Permitting, City of Austin Development Services Department, accessed October 2026
- Child care centers now allowed in more places across Austin, Community Impact, October 2023
FAQ
Frequently asked questions
How much indoor space does a licensed childcare center need in Texas?
Texas minimum standards for child-care centers require at least 30 square feet of indoor activity space for each child the center is licensed to serve. Offices, restrooms, a kitchen, storage, and hallways come on top of that, so the whole suite needs to be larger.
Does a daycare need an outdoor play area in Texas?
Yes. Licensed centers need 80 square feet of outdoor activity space for each child using it at one time, and the area has to be large enough for at least a quarter of the licensed capacity. An outdoor area that is not connected to the center needs a plan approved by Texas HHSC and a safe route to reach it.
Can I open a daycare in a retail shopping center in Austin?
Often, yes. Austin allows child care as a primary use in most zoning districts, but you still need to confirm permitted use for the specific address, room for a fenced play area, and landlord approval. Some shopping centers restrict child care in their leases or recorded restrictions.
Should I sign the lease before my childcare license is approved?
Texas HHSC inspects the actual building before it issues a license, so most operators sign before licensing is final. Protect yourself with contingencies for permitted use, permits, and a certificate of occupancy, and tie rent commencement to opening.
Who pays the broker when a childcare operator leases space in Austin?
In most Austin leases the landlord pays the commission, so tenant representation usually costs the operator nothing out of pocket. A short written representation agreement spells out who pays before the search starts.
About the author
Tristen Palori is a licensed commercial real estate agent with Foresite Commercial Real Estate and leads Austin Commercial Sites, the firm's Austin team. He has worked Austin office, retail, medical, and industrial deals since 2019. More about Tristen.
