Big Tech Leaves Big Subleases in Austin Office Market

Austin’s boom-era sublease wave hasn’t crested, but it has shifted addresses.

The city’s downtown office market is showing strain, with major tenants collectively marketing over 900,000 square feet of space for sublease, the Austin Business Journal reported.

From Meta to Vista Equity, many of the same firms that signed record leases in the city just a few years ago are now offloading space they never fully occupied.

Big Tech firms, especially, have tempered their Austin commitments. One of the city’s largest leases, Google’s full-building, 804,000-square-foot space at the Sail Tower, recently landed a 11,200-square-foot sublease from Digital Realty Trust on the 32nd floor.

Five other blocks of space over 70,000 square feet each are up for grabs downtown. About 4.5 million square feet of sublease space was available in May, including 1.3 million in the CBD, per CBRE and Partners.

Here’s a breakdown of the biggest listings, compiled by the outlet:

Meta Platforms: 558,000 square feet

Meta still holds the largest contiguous sublease block in Austin at the mixed-use Sixth and Guadalupe tower at 400 West 6th Street, developed by Lincoln Property Company and Kairoi Residential and delivered in the fall of 2023. The company pre-leased 33 floors in 2021 and began seeking a subtenant in 2022. It recently secured a tenant for one 30,000-square-foot floor.

Athenahealth: 112,300 square feet

The health tech firm is subleasing most of its footprint at the Seaholm Power Plant, a redeveloped mid-century structure west of downtown at 800 West Cesar Chavez Street. The company first signed on in 2014 and is offering nearly half the building.

Indeed: 98,000 square feet

The jobs platform is offering the bottom three floors of its namesake tower at 200 West Sixth Street. Indeed has struggled to fill its space across Austin, having also placed its entire 184,000-square-foot Domain Gateway office on the sublease market in 2023.

Vista Equity Partners: 79,500 square feet at The Republic

The private equity firm signed for 200,000 square feet in Lincoln Property Company’s still-unfinished The Republic, rising at 401 West 4th Street. Vista is marketing nearly 80,000 square feet across three floors, still retaining a major footprint.

Vista Equity Partners: 73,400 square feet at Frost Bank Tower

Vista is also subleasing its old space at Frost Bank Tower, at 401 Congress Avenue, as it preps the move to The Republic. The firm cited growth limitations in the older building as a reason for the shift.

— Judah Duke