Austin Sets Country’s Return-to-Office Pace

Workers in Texas’ capital city are setting the pace for a return to the office, with employees heading back to downtown towers and corporate campuses at the highest rate in the country. Austin offices are 59 percent occupied, the Wall Street Journal reported, citing data from office-security firm Kastle Systems.

In the nation’s 10 largest office markets, including New York and Los Angeles, occupancy is about 40 percent, according to the Kastle report. Kastle gets its data by recording badge swipes as workers come and go in skyscrapers and at corporate campuses.

Major Texas cities had higher return numbers than the national average, with Dallas and Houston offices both about 50 percent occupied in April. In contrast, San Jose, California — which Austin has in some ways been trying to replicate as a major tech center — had the lowest attendance rate in the country at 31 percent. The contrast with Silicon Valley can in part be attributed to the role of tech-adjacent workers — such as those in sales, marketing and business — in the new Austin economy, according to the report.

While a number of major tech companies have announced long-term plans for remote and hybrid work, their appetite for Austin office space continues to be robust. Facebook parent company Meta, which already has several offices in the city, will lease 589,000 square feet in Austin’s tallest office building when it’s completed. Google has leased a 35-story, 590-foot downtown building with 800,000 square feet of office space. Indeed will occupy part of its namesake tower, which when open will have the most office space of any downtown skyscraper. TikTok, Snap and Cirrus Logic have also leased downtown space recently, the Austin Business Journal reported.

Outside the central business district, Apple is developing a 3-million-square-foot second campus in northwest Austin. Amazon will lease 330,000 square feet in a new building at north Austin’s Domain, where it is already renting offices in two buildings.

While tech companies seem bullish on office space — in Texas, anyway — it’s worth noting that much of the square footage their workers will occupy is leased. With 10 million square feet under construction, Austin led the country in office starts in March but ranked lowest in office property sales.