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Exxon Mobil Will Relocate Its Headquarters From Irving To A Megacampus In The Houston Area.

Exxon Mobil Corp. is leaving its Irving headquarters and relocating its top executives and corporate staff to its Houston megacampus.

The move was revealed on Monday as part of a bigger reorganization of Exxon’s business units.

Around 20 buildings house more than 10,000 Exxon employees on the enormous 385-acre complex in Spring. It’s roughly 25 miles west of downtown Houston, at the crossroads of Interstate 45 and the Hardy Toll Road.

According to Exxon’s release, the project should be completed by mid-2023.

Chairman and CEO Darren Woods stated in a statement, “We strongly respect our long history in Irving and enjoy the strong links we have formed in the North Texas community.” “By collaborating more closely and adopting a more simplified business model, ExxonMobil will be able to increase shareholder value and position itself for success as the energy transition unfolds.”

According to spokeswoman Erin McGrath, about 250 Exxon personnel work in Irving, including the company’s management committee. To retain as many personnel as possible and facilitate their relocation to the Houston area, the company offered relocation benefits.

According to McGrath, the migration is unlikely to result in significant employment losses.

When Exxon announced its relocation from Manhattan to Irving’s Las Colinas, a 12,000-acre development of offices, shopping complexes, and luxury homes, it made a tremendous splash. Around 300 corporate jobs relocated to North Texas at the time.

However, the move made Exxon the largest firm in Dallas-Fort Worth by revenue right away, giving economic development officials a desired Fortune 500 headquarters to use to entice further corporate relocations. Its relocation to North Texas follows the footsteps of other New York-based companies such as American Airlines in 1979 and J.C. Penney in 1988.

Exxon held the top spot in The Dallas Morning News’ annual ranking of the region’s largest public corporations until last year, when Irving-based McKesson Corp. overtook it. When the pandemic slashed demand for oil and led prices to plummet, Exxon’s annual revenue fell to $178 billion in 2020.

Oil prices have subsequently recovered, and Exxon will release its year-end results for 2021 on Tuesday.

As part of a plan to save $6 billion off its pre-pandemic expenditures by next year, the nation’s largest oil corporation aims to merge its chemical and refining divisions and centralize its technology and engineering operations.

Its three business lines that resulted — upstream, product solutions, and low-carbon solutions — would all be based in Houston. These changes will take effect on April 1st.

Exxon’s cost-cutting strategy has included workforce layoffs. According to regulatory filings, its global workforce shrank from 75,000 at the end of 2019 to 72,000 by the end of 2020. Job layoffs are expected to save the corporation $1 billion to $2 billion per year.

In late 2020, it fired off 1,900 employees, the majority of whom were based in Houston. It consolidated its Houston footprint last year by relocating around 1,500 employees from The Woodlands to the Spring location. According to the Houston Chronicle, Exxon then put 290,814 square feet of space in The Woodlands on the sublease market.

“Our new business structure enables us to better serve our clients by using the corporation’s scale, integration, and technological advantages, as well as the skills and capabilities of our outstanding employees,” Woods added.

When Exxon constructed the Spring campus in 2014, speculation was rife that the firm would eventually relocate its corporate headquarters there.

While the decision was “not unexpected,” according to Bruce Bullock, director of Southern Methodist University’s Maguire Energy Institute, it will harm Dallas’ image as an energy center.

“HollyFrontier is still here. Bullock stated, “We still have Energy Transfer.” “However, this is the world’s largest [exploration and production] corporation.” It undoubtedly tarnishes the Dallas-Fort Worth area’s reputation as a center for the oil business.”

Irving, which promotes itself as the “headquarters of headquarters,” takes a hit as a result of the ruling. Irving is home to eight Fortune 500 firms, including ExxonMobil.

The Dallas Cowboys’ headquarters moved to Frisco in recent years, while the Byron Nelson golf tournament left its traditional home at the Four Seasons Resort and Club.

According to Beth Bowman, president and CEO of the Irving-Las Colinas Chamber of Commerce and Irving Economic Development Partnership, Irving’s economic development pipeline is “full of companies looking to relocate to Texas, and Irving-Las Colinas is one of the most desirable and competitive locations in the state and country.”

“Right now, we have 94 million square feet of commercial space occupied and $306 million in capital investments,” she said. “One of the major draws for global corporations is Irving-Las Colinas’ varied population and workforce.”

However, she stated that Exxon’s jobs and substantial contributions to community organizations will be missed.

“We are excited about the additional options that this outstanding real estate will provide for our city, inhabitants, and business community,” Bowman said.

Exxon’s Irving campus, which was built in 1995 and encompasses 356,829 square feet, as well as surrounding property, will be put on the market, according to McGrath. According to Dallas County property records, the corporation owns a dozen properties in Irving with a combined taxable value of more than $130 million, albeit not all are part of the headquarters.

Exxon will be the 25th Fortune 500 company in the Houston area. Only New York City and Chicago have a higher concentration of Fortune 500 firms than Houston, which is headed by energy industries.

Exxon’s exit will be countered by last year’s addition of engineering firm AECOM from California, bringing the total number of Fortune 500 companies in Dallas-Fort Worth to 22.

The Dallas Regional Chamber expressed its delight in Exxon’s decision to stay in Texas in a statement released Monday.

“The Dallas region has been one of the fastest-growing markets in the United States since 2010,” according to the statement. “The transfer of 176 corporate offices, hundreds of local firm expansions, and the creation of one million new employment have all contributed to this rise.”

According to the chamber, six Fortune 500 companies have relocated to D-FW in the last six years, with “more on the way.” Since 2016, pharmaceutical distributor McKesson, financial services business Charles Schwab, engineering firms Jacobs and AECOM, real estate firm CBRE, and convenience store supplier Core-Mark have all moved their headquarters out of California.

The company’s roots may be traced back to John D. Rockefeller’s Standard Oil Co., which was once the world’s largest oil refiner. When the United States Supreme Court declared in 1911 that it was an illegal monopoly, it was dismantled. Exxon and Mobil reunited in 1999 in a merger of two of Standard Oil’s firms that stemmed from the split.

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