3M Co. placed 204,000 square foot of North Austin offices on the sublease marketplace.
According to a brochure on sublease, the space at 13011 McCallen pass is all three floors of one of their buildings located in Parmer Austin and includes labs. 3M (NYSE MMM) intends to continue occupying other space at the Parmer Austin campus. However, it is not known how much.
Leaders at Minnesota's 3M have been cutting jobs and re-evaluating their real estate requirements. The company, a conglomerate which makes everything from office supplies and personal protective equipment to office supplies, announced 2,500 job cuts in January. Last month it revealed plans for another 6,000.
Uncertainty remained as to whether these cuts had any impact on Austin. 3M reported 349 employees working in Austin during the first quarter of the year, up from 330 in the previous year.
Tim Post, 3M's communications manager, said that 3M was reviewing its global office space and service requirements for all its locations. The 3M offices were constructed when all employees expected to work on-site. As we have moved to a more flexible model of work with fewer on-site employees, our space requirements have changed. 3M is committed to Austin. "We plan to sublease some of our office space in Austin."
The changing real estate calculus of the company exemplifies changes in office use after the pandemic. This is the largest sublease to have hit the market recently. In November, Facebook's parent company Meta Inc. announced that it would sublease 589,000 square foot of office space at downtown's Sixth & Guadalupe Tower. Last month, both TikTok Inc., and Workrise Technologies Inc., placed downtown office space for sublease.
3M is believed to have occupied more than 335,000 sq ft at the Parmer business park by early 2020. It was not clear how much space 3M currently occupied, but if the company were to sublease its entire 204,000 square foot, it would leave it with approximately 131,000 square footage.
According to the brochure, 3M wants to sublease an office building named Parmer 3.3. The building has 16 wet laboratories and three floors of 68,000 square feet. It is available immediately. The building rental is $22 triple net and the lab is $24 triple net. The lease term was unclear.
The building has 44 conference rooms and 29 huddles rooms. It also includes a gym, wellness rooms and a copy station. The Parmer Campus is also home to blue-chip tenants like The Home Depot (NYSE HD), Apple Inc.
The sublease brokers are Scott Studzinski, Logan Dalgleish and Cresa.
According to public records, Alexandria Real Estate Equities Inc. NYSE: ARE is the owner of Parmer 3.3.
PRP Real Estate Investment Management LLC, based in Washington D.C., bought two Parmer office building occupied by 3M for $145 millions from Parmer developer Karlin in 2020. PRP sold these two buildings in 2021 for $184.4 millions. PRP stated that 3M still had 13,5 years left on its lease. The buildings were finished in 2019.