Software giant Oracle is looking for tenants to replace its previously vast footprint in the greater Boston area.
The global tech firm has listed the majority of its multi-property campus in Burlington, according to marketing materials viewed by CoStar News. The listings, offered both on a sublet and direct bases, total roughly 407,100 square feet of office space across the buildings at 4, 6 and 10 Van de Graaff Drive.
Oracle appears to be consolidating its presence at 8 Van de Graaff Drive, a 150,000-square-foot building the company has owned since it was developed about 15 years ago and where it is expected to remain the sole occupant.
The company, which both owns and leases space across its global portfolio, has been a longstanding corporate presence in the Burlington area for the past several decades. At its peak, it occupied all four Van de Graaff properties, three of which Oracle developed for its own use and has owned ever since.
Since the pandemic's outbreak in early 2020, however, Oracle has made a series of downsizing moves that have meant significant cuts to its global real estate footprint.
Along with its plans to backfill space at its Burlington campus, the company has been trying to offload space across properties it owns in the Denver area; Silicon Valley, Southern California; and elsewhere throughout the United States, according to listing materials. Its listings at 7604 and 7700 Technology Way in the Denver Tech Center neighborhood collectively span upward of 218,830 square feet and have been sitting on the market for the better part of the past year.
Shoes to fill
Oracle's real estate moves echo others made by companies such as Alphabet's Google and Amazon as they continue to aggressively shrink their corporate office portfolios and redirect the savings toward higher-priority initiatives. Google alone paid $607 million through the third quarter, the latest impairment charge to offload extraneous office properties as it doubles down on its more prudent approach to growth.
While leasing among tech companies, especially those in the artificial intelligence sector, has rebounded in recent months, there is still a record amount of available office space across the country that will take more than a few deals to fill.
Tenants collectively handed back upward of 65 million square feet of U.S. office space last year, boosting the total to more than 210 million square feet of move-outs since the start of 2020, CoStar data shows. The national office vacancy rate is expected to keep climbing from its current record of about 14% through at least 2027, according to CoStar analysis, and smaller lease sizes are likely to further complicate any widespread recovery efforts.
Depressed headcount growth and ongoing downsizing moves among companies such as Oracle have combined to shrink average deal size. While more leases are being signed compared to activity levels reported in the run-up to 2020, recent deals are about 20% smaller than pre-pandemic averages, according to CoStar analysis.
Consolidation and offloading plans aside, Oracle remains a powerful influence throughout the national office market. The Austin, Texas-based company occupies about 17 million square feet, according to CoStar, a majority of which it owns itself.
Oracle representatives did not immediately respond to CoStar News' request for comment. JLL is helping to list some of the company's properties.