Austin’s office market is exploding. But no one is moving in.

But when Austin’s tallest building officially opens later this year, all that office space will be empty. Meta has ditched its move-in plans and is now trying to sublease 589,000 square feet of offices, 1,626 parking spots, 17 private balconies and a half-acre of green space. So far: No takers.

The skyscraper known as “Sixth and Guadalupe” is the most glaring example in the city that made a huge bet on the post-pandemic commercial real estate economy. While other cities worry about a glut of office space as workers resist returning to the familiar 9-to-5 grind, Austin’s challenges are Texas-sized.

Here, about 6 million square feet of new office space will hit the market in the next few years — equivalent to 105 football fields. Between spaces completed since 2020, and what’s still in the pipeline, the office market will grow nearly 25 percent — the fastest rate on the continent. That includes projects like the Waterline, which will become the tallest building in all of Texas, at 74 stories, when it opens in 2026, and a mammoth, 1.1 million square foot complex on the city’s outskirts where a former 3M campus is being redeveloped (into what, exactly, is still unclear.)

And the vast majority of projects are blazing ahead without companies lined up to move in. Roughly 87 percent of new office space is expected to open vacant, according to data from the commercial real estate firm Cushman & Wakefield.

Developers and city officials say they’re riding the city’s next expansion, confident that tech companies and other growing industries will flock here in the years to come. Yet others fear the boom could quickly devolve into a bust, telling a cautionary tale about what happens when development outruns a local economy — and what’s left after the good times end.

“It’s just so striking that even after the economy has cooled off … all I see are cranes everywhere around me,” said Julia Coronado, founder of MacroPolicy Perspectives and a longtime Austin resident. “There are ‘for lease’ signs on these brand new, beautiful buildings. Who is going to go there? I don’t know.”

Austin wasn’t always like this. Decades before Tesla’s headquarters and a burgeoning crypto scene arrived, the University of Texas was a major player in the local economy. The state Capitol was among the tallest landmarks, and housing was cheap. Tech had a presence starting in the 1970s and 1980s, thanks to Motorola, IBM and Dell. But a popular mantra then summed up the desire to preserve the city’s small-town feel: “If we don’t build it, they won’t come.”

But that changed as Big Tech expanded beyond San Francisco. Indeed, the job search site, was co-founded in Austin in 2004. Apple, Google, Facebook and Palantir expanded their local offices. In 2020, Oracle announced it would relocate its corporate headquarters from Silicon Valley.

The pandemic supercharged Austin’s growth even more. The tech industry exploded as the world shifted online. Home buyers raced to scoop up cheap properties, and young workers seized the chance to work remotely under the Texas sun. And with so many people flocking here — Austin is now the country’s 10th largest city — developers and local officials bet on a real estate boom.

Interest rates were rock-bottom until early 2022, making it easy for developers to get financing for dozens of new projects. And since it’s common in Texas for commercial real estate to be built entirely on spec, developers could get loans without any guarantee that they’d be able to lease the space.

To cater to young workers with high-paying salaries, many buildings were designed as all-in-one complexes, with office space, apartments, shops and dining all stacked together. A new luxury building called Paseo promises the chance to “Live, work, play and rest in one place” when it opens in 2025. A mile away at Sixth and Guadalupe, 33 floors of apartments are stacked on top of 19 floors of offices. Elon Musk’s brother is opening up a restaurant on the ground floor.

Seth Johnston, senior vice president and market leader of Lincoln Property Company, said timing is on the industry’s side. The global developer is behind multiple Austin projects including Sixth and Guadalupe, which got rolling when financing was cheap. Now LPC and its peers will have the newest offerings with the sleekest amenities, Johnston said. And there won’t be fresh competition coming up behind them, since financing for new projects has almost entirely dried up.

“These companies, they want newer amenities in their space,” Johnston said. “They want fresher air filtration systems. They want touchless technology, and that’s harder to do in the older, ’80s vintage buildings downtown … By and large, there’s always going to be that flight to quality. And I think we’re in a position to hopefully take advantage of that.”

In a statement, Meta spokesman Tracy Clayton said Meta’s goal is to “build a best-in-class hybrid work experience.” The company’s commitment to Austin is also clear by the roughly 1,000 employees who live there, Clayton said.

Industry officials also argue that, technically, many of the buildings aren’t vacant. Meta’s name is still on the lease at Sixth and Guadalupe, after all, even while the company looks for new tenants. Another LPC building, called The Republic, has leases lined up for a law firm and a private equity firm. Another building downtown had 35 floors scooped up by Google, which continues to pay rent even though its move-in plans are still in flux. That means developers and their lenders stay financially sound, at least for now.

Still, only the biggest, richest firms can afford to lease huge offices they don’t use. And empty towers don’t do much to liven up an area or attract new customers.

Down the block from Meta’s skyscraper, Nikki Nichol was getting ready to open Ranch 616 one morning last month. The restaurant where she works as an assistant manager and bartender is typically hopping on weekends. Except lately, Nichol said more customers complain about the towering buildings blocking all the breeze.

When Nichol moved to Austin in 2010, she paid $695 for a one-bedroom apartment. Now she’s paying almost double for a studio. She said parking is “atrocious,” and that getting around the city is impossible because of all the construction. She said she can’t grasp the vision for a city that’s getting harder and harder to recognize.

“It’s like they’re going to ‘field of dreams’ it,” she said.

Remarkably, there’s a craving for even more space. Data from the Downtown Austin Alliance shows developers have proposed an additional 3.9 million square feet of office space — and would be moving forward if banks weren’t shying away from new loans.

“If rates were low and money was available, there’s every indication that these buildings would get built,” said Dewitt Peart, the organization’s president and chief executive. “Now the pandemic has thrown a wrench into everything. But I think the sense is that money still wants to flow to Austin.”

At the same time, though, all of the new space is driving down the value of decades-old buildings that are gradually hollowing out. On one downtown street corner, a drab 40-year-old building bears a large “For Lease” banner. Right next door, construction crews were working on a luxury, 58-story skyscraper.

Jeff Graves, research director at Cushman & Wakefield, can look out the window at the changing skyline. From his office, he pointed to a luxe new building right across the street from an abandoned, rat-infested government building that is slated for demolition. Turning a little, he gestured to an old Austin landmark that has managed to hold on to its tenants, which he called an outlier.

Just on the other side of Graves’s window, a construction crew was practically dangling out the side of a brand new office tower.

Graves lived in Las Vegas during the 2007-08 housing market crash, and wonders if a similar bubble could come for Austin commercial real estate. The answer may lie in what happens with prices, which so far aren’t budging. Leases at brand new skyscrapers — roughly $50 per square foot at the newest buildings — are so high that smaller businesses are getting priced out. But so far, landlords would prefer to throw in perks, like six months of free rent on a decade-long lease, before caving to a discount.

That approach may only work for so long. And things could come to a head if lenders get antsy that they’re taking too much of a loss.

“No one wants to be the first to drop rates,” Graves said. “They’re in for a lot of money.”

Other problems could hit Austin hard, too. Tech firms that bulged in the pandemic are laying off thousands of employees. Return to office policies are still fraught and in some cases, backfiring.

Zoom out a bit more, and cities nationwide are trying to figure out what comes next. New York and San Francisco are overwhelmed with untapped office space. Some economists fear that midsize cities, from Minneapolis to Memphis, could be even more vulnerable to a kind of “doom loop” that starts with empty offices and canceled leases, and spirals into something scarier for downtowns and city coffers.

And policymakers are still pushing hard to cool the economy down. Officials at the Federal Reserve have made clear that they will keep interest rates high for as long as necessary. No one knows how long their aggressive moves will slow growth, especially because the totality of the Fed’s moves may not have hit yet.

Some economists argue those delays are shorter nowadays. The Fed telegraphs its moves far in advance so the markets have time to price higher rates in. But when Coronado, the MacroPolicy Perspectives economist, looks around Austin, she sees consequences still ahead.

It takes years, she said, for massive commercial real estate projects to get financing and permitting, and finish construction and price out leases. By the time each new building goes through the cycle, supply will far outstrip demand. Prices could drop, even plummet, in a way the city may not be ready for.

“I don’t know whether this just means losses for contractors, but it’s fine. Or losses for some banks, but they absorb the blow,” Coronado said. “But I do know that even if it is the intended effect of Fed policy, the full effect isn’t yet in the employment data, in the construction data, that still lies ahead.”

Only time will tell. But already, the mismatch stands out. On a recent afternoon, shoppers milled about the Domain, a sprawling outpost of office suites, restaurants, high-end retail stores and hotels 12 miles north of downtown. Scattered between Gucci and Tesla storefronts are a few reminders that shoppers are still in Texas: a burnt orange window display at a jewelry store, a leather boots shop. An overhead speaker played Taylor Swift’s “Wildest Dreams.”

The office park nearby towered over the few workers around. Companies like Indeed, Vrbo, Amazon, IBM, Charles Schwab and Facebook have taken up space. But the overall vacancy rate across the complex is still 15 percent, according to Cushman & Wakefield. (Amazon founder Jeff Bezos owns The Washington Post, and the newspaper’s interim chief executive, Patty Stonesifer, sits on Amazon’s board.)

Ryan Crawford was walking back from lunch with co-workers from AWS last month. Crawford said the area had been a bit more crowded since Labor Day, when a wave of return-to-office orders went into effect. But not by much.

“The bars, the restaurants are one-third full,” he said. “Few people are sticking around to socialize. Most people do live far away.”

Sitting at a table nearby, a man read a book on his lunch break. He’d recently learned he was laid off from the consulting and tech firm Accenture, which was shedding more than 500 workers at its Domain office. He declined to share his name, fearing retribution from the company.

He said he lived nearby and had mixed feelings as the site went up. The high-end offices with the high-paying jobs fit uneasily in what was otherwise a lower-income area, he said. On the other hand, he had an easy commute, until his job went away altogether.

What would happen to his old office, he didn’t know.