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The office real estate picture in Austin, TX is constantly changing but one company’s loss may be another company’s gain. Meta (NASDAQ:META) is leaving behind its lease in The Domain, a mixed-use neighborhood that includes several office towers.
Meta leased Domain 12, a 15-story glass tower, but as of Jan. 1, 2026, IBM will be taking over 320,000 square feet of office space. The property includes a cafe, outdoor terraces, a fitness center and bike storage. The new lease will extend the lease maturity from 2031 to 2040.
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IBM has a long history with the area now called the Domain. The original 235-acre IBM research campus was sold in 1999 for $60 million and IBM leased back part of the property. IBM announced that it would be relocating to a new campus by 2027. The company was planning to lease space in OneTerra, a 507,200-square-foot office project being developed by Hines Real Estate. In a statement, IBM said, “IBM remains committed to investing in new experiences for our clients and employees in this market.”
The move is a win for Cousins Properties (NYSE:CUZ), an office REIT that owns the building. Cousins’ Domain portfolio comprises 2.5 million square feet and is currently over 99% leased. “The Domain provides a highly amenitized experience that leading companies recognize as a critical tool to drive employee recruitment, retention and culture. We are thrilled to see growing customer demand for lifestyle office properties in Austin,” said Colin Connolly, President and Chief Executive Officer of Cousins Properties.
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Meta has been changing its relationship with office properties in Austin and elsewhere. Over the past several years, it has tried to leave around one million square feet of office space in Austin. In 2022, it announced it would not be moving into the 586,000-square-foot space it leased at the recently completed Sixth & Guadalupe Tower, currently the tallest in Austin at 865 feet. Last year, the company also put 120,000 square feet at 300 West Sixth Street into the sublease pool. It still has 320,000 square feet of space at the Third + Shoal building.
Meta’s office footprint is also shrinking in Bellevue, WA, where it has leased several properties, some of which are now up for sublease. Last year, it subleased its space in Fremont, CA, to a pharmaceutical company. It listed its 435,000-square-foot space at 181 Fremont in San Francisco for sublease in 2023 and potential interested tenants have included TikTok and Zendesk.
The Austin office market has been experiencing a lot of supply coming online at the same time that many companies are reconsidering their relationship with office space. Many tech companies have at least some footprint in the booming state capital but some have been reducing or scaling back their efforts. In recent months, as much as 20% of Austin’s office space has been vacant. Deals are still getting done but are often smaller leases under 100,000 square feet as companies reconsider their relationship with large headquarters.
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This article Meta Is Leaving Its Austin Office, Guess What Big Tech Company Is Moving In originally appeared on Benzinga.com
Source: finance.yahoo.com