Tesla recently made big headlines after CEO Elon Musk revealed that the company would be moving its headquarters in Palo Alto to Austin, Texas. But it appears that the company will keep at least some presence in Palo Alto. According to The Registry, Tesla has signed a lease agreement for a big section of office space totaling 325,000 square feet located at 1501 Page Mill Road. Hewlett Packard owns the buildings on the property and Stanford University owns the land that sits inside Stanford Research Park.

Tesla has apparently signed a ten-year lease on the office space which is just a few minutes from the headquarters it is supposedly leaving behind at 3500 Deer Creek Road. So far, it’s unclear what type of operations Telsa has planned for the leased space but the campus is equipped with energy-efficient features, along with a cafeteria, coffee bars, and outdoor seating.

According to The Registry, the 325,00 square foot lease equals roughly 1/10th of the office space available right now in Palo Alto which has the highest lease rate in Silicon Valley. The average price in Palo Alto is $9.20 per square foot. The second highest rate is in Mountain View at $7.49 per square foot. Experts believe that the lease deal is a signal that even when companies try to cut down their presence in California, the Bay Area remains a place where most tech companies should be expanding. 

“The glass is more than half full. Numerous sizeable companies are expanding right now for 2022 and 2023 occupancy, ”Phil Mahoney with commercial real estate firm Newark told Mercury News. “Every time you have a company moving its headquarters out of Silicon Valley, they tend to increase their presence here. Silicon Valley is pretty secure for now,” Dave Sandlin with commercial real estate firm Colliers told Mercury News.

Tesla’s headquarter move from California to Texas comes after Oracle and Hewlett Packard did the same, yet both tech companies still have a major presence in the Bay Area — tax reasons, perhaps? During his announcement of the move to Texas, Musk highlighted that California will still be a cornerstone for Tesla. “To be clear we will be continuing to expand our activities in California. Our intention is to increase output from Fremont and Giga Nevada by 50%. If you go to our Fremont factory it’s jammed.” It remains unclear when Tesla employees will start utilizing the newly leased offices or when the move of the company’s headquarters will be fully complete.