Hines landed Big Blue as the anchor of its office development in the Domain district of North Austin.
Tech giant IBM leased about 320,000 square feet, including one full building, in the 500,000-square-foot project at 11901 North MoPac Expressway, which is expected to be move-in ready by 2027, the Austin Business Journal reported.
The project comprises two 14-story adjoined office buildings, called Hines Domain Northside, which will replace La Quinta Inn and Suites. Hines’ original plans called for 320 residences and offices in a single 15-story development.
The Houston-based developer ditched the mixed-use component in favor of pure office. The buildings will have separate cores and lobbies, but they would share an eight-story podium parking garage, Hines senior managing director Philip Croker told the outlet.
IBM leased an entire building, plus the top six floors in the adjacent one. Hines, led by Jeffrey Hines and Laura Hines-Pierce, has incorporated sustainability elements into a number of its projects, which ultimately played a role in IBM’s decision to commit to the project.
“They just have some really great, creative ideas as to how they could bring our vision of our office experience to life,” IBM’s Joanne Wright told the outlet.
The move is a considerable downsize for IBM, which operates at an 800,000-square-foot site on Burnet Road, about a mile from its new digs. The relocation plans came to light a day after IBM CEO Arvind Krishna told Bloomberg News the company will pause hiring for roles that could be replaced with AI, potentially eliminating about 7,800 jobs.
Even though it’s shedding a large chunk of space, IBM’s long-term commitment bodes well for Austin’s struggling office sector, as vacancy rates reached a record high of 19 percent in the first quarter of 2023.
—Quinn Donoghue
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