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Liberty Mutual Insurance seeks to rent out a big chunk of its Plano offices

Seven floors of huge Legacy West office campus offered for lease.

One of Plano’ newest corporate office locations is offering up a big lease.

Liberty Mutual Insurance is seeking to rent out almost a quarter of its two-tower office campus on the Dallas North Tollway.

The 2-year-old office high-rises are part of the $3 billion Legacy West development.

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Liberty Mutual built the more than 1 million-square-foot office complex to house up to 5,000 workers. But the Boston-based insurance giant has never occupied all of the buildings and is now pitching some of its space for lease to other companies.

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“We regularly assess our real estate portfolio against business and workplace needs,” a Liberty Mutual spokesman said in an email. “Even prior to the coronavirus pandemic, ongoing changes in our work environment, including moving to flex seating and flexible work arrangements, had resulted in an increase in excess office space in Plano and other locations

“To help decrease costs and improve competitiveness, we look for opportunities to reduce the unused space while maintaining what we need.”

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Commercial property firm Savills Studley is looking for businesses to occupy seven floors in the south tower of Liberty Mutual’s complex.

The office space will be available in October and is offered at more than $44 per square foot. The space is for rent for five years, according to marketing materials from Savills.

Designed by Dallas architect Omniplan, Liberty Mutual’s regional office includes a 4,500-space parking garage, food service facilities, a fitness center, health service facilities and two conference centers.

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The insurance firm’s Plano digs at the corner of the Dallas North Tollway and Headquarters Drive cost more than $325 million and started construction back in 2015.

Most of the company’s Plano employees have been working from home during the pandemic.

The Liberty Mutual offices are one of the largest offerings in a surge of new sublease office space hitting the market in North Texas.

Almost a half million square feet of additional sublease offices — surplus offices companies are hoping to rent out — have hit the market just in the last month, according to a new report from Transwestern.

“New sublease availabilities began accelerating in June, resulting in 830,000 square feet of new space coming to market through the second quarter,” Transwestern research manager Andrew Matheny says in a new report. “Transwestern’s tracking shows more than 92% of this space has come in large blocks of more than 15,000 square feet.”

The upper Dallas North Tollway market in Plano and Frisco has seen the biggest increase in sublease offices of more than 400,000 square feet.

Sabre is also seeking to sublease almost 200,000 square feet of offices in its campus in Westlake.

“We are seeing some subleases come from some businesses that have been impacted by the current state of the economic environment — oil and gas, event, trade show, travel, etc.. — things that have been hit especially hard,” said Grant Pruitt of Whitebox Real Estate. “We are seeing a number of companies that may just not need all of the space they have.

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“They went to a hybrid of in-office and virtual workforce,” he said. “They may need to expand in future, though, as people come back to the office.”

Pruitt said the amount of sublease office space hitting the market shouldn’t be a long-term problem. And real estate brokers say inquiries about office space in the D-FW area have increased in recent weeks.

“Our interest from companies looking to relocate to Texas has jumped materially since mid-June,” said Chris Taylor, executive managing director of Cushman & Wakefield. “The economic development groups in D-FW have seen a big increase in inquires, and we are starting to see this activity enter the local real estate market as some of these companies work to relocate their companies from areas all over the U.S., with a heavy concentration from New York, California, Chicago and Seattle.”

The surge in office subleases is on top of the almost 5 million square feet of new buildings under construction in the D-FW area.

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With companies cutting back and more of their people working at home, businesses are using less office space than in recent years.

So far in 2020, net office leasing in North Texas has dropped by almost 2 million square feet, ending a long stretch of big leasing gains in the area.

Liberty Mutual is seeking to rent out seven empty floors in one of the high-rises.
Liberty Mutual is seeking to rent out seven empty floors in one of the high-rises.(Savills Studely )