Meta, Microsoft to free office buildings from WFH, mass layoffs. report

California.

Facebook parent Meta and Microsoft are separately vacating office buildings in Seattle and Bellevue, Wash., in the latest sign of changes in the tech industry and a softening office market, the Seattle Times reports.

Facebook confirmed Friday that it plans to sublease its offices in the six-story Arbor Block 333 in downtown Seattle and the 11-story block in Bellevue’s Spring neighborhood, the Seattle Times reported.

The Menlo Park, Calif.-based social networking giant said it is also reviewing leases at other Seattle-area office buildings. A soft market is a phase of the economic cycle characterized by more sellers than buyers and low prices.

The same day, the Seattle Times reported that Redmond-based Microsoft confirmed reports that it would not renew its lease at the 26-story City Center Plaza in Bellevue when that lease expires in June 2024.

The Seattle Times notes that the announcements come as the continued popularity of remote work and a tech slowdown with major layoffs have both reduced demand for office space in Seattle and elsewhere.

Both Meta and Microsoft have embraced telecommuting while cutting their workforces as the technology sector weakens, according to the daily. In November, Meta announced 726 layoffs in the Seattle area.

Meta spokeswoman Tracy Clayton told the Seattle Times that leasing decisions are largely driven by the company’s move toward remote or “distributed” work. But he acknowledged that “given the economic climate,” Meta is also “trying to be … financially prudent.”

Meta currently occupies all of Arbor Block 333 in Seattle and would have occupied all of Block 6, which is slated to open later this year. The company still has offices in 29 buildings and nearly 8,000 employees in the Seattle area, which remains the company’s second-largest engineering center outside of its Menlo Park headquarters, Clayton said.

A Microsoft spokesperson described its decision on City Center Plaza as part of the company’s “ongoing evaluation of its real estate portfolio to ensure we provide an exceptional place to work and create greater collaboration and community for our employees.”

The City Center Plaza decision also comes amid a massive renovation of Microsoft’s Redmond campus, part of which will be completed by the end of 2023. But the daily said Friday’s news adds to an already poor outlook for the Seattle-area office market as it struggles to cope. economic headwinds and the slow return of remote office workers.

That struggle is most visible in downtown Seattle, where overall office vacancy is now at 25 percent, according to a new report from commercial real estate agency Colliers.

The Seattle Times says that even non-vacant offices are often half-empty due to remote work. Since last summer, only 40 percent of downtown Seattle workers have been present before the pandemic, according to Placer.ai mobile phone location data posted by the Downtown Seattle Association.

(Except for the headline, this story was not edited by NDTV staff and was published from a syndicated feed.)