Austin Office Tower Sold to Joint Venture

A group including Aquila Commercial purchased the 26-story downtown tower from California-based KBS.

Updated on Sept. 25, 2026 in Commercial

A modern glass and steel office tower facade rises against a clear blue sky in Austin, Texas. — A joint venture featuring Aquila Commercial and Glendon Capital Management has acquired a prominent 26-story office tower at 515 Congress Avenue in Austin from KBS. AI Illustration. Upload story photo >

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Aquila Commercial, Glendon Capital Management, and Palmatum Ventures have acquired the 268,000-square-foot office building located at 515 Congress Avenue in Downtown Austin. The transaction follows the property being listed by seller KBS earlier this summer.

Why it matters

This acquisition represents a significant shift in ownership for a prominent downtown asset during a period where commercial real estate values in the district have seen substantial fluctuations. The new ownership group intends to implement improvements to the property to better serve current and future tenants.

The 26-story tower sits on a site that includes 268,000 square feet of total space and is currently 80 percent leased. The property is supported by a 2026 tax appraisal value of $117 million, a decline from its 2022 appraisal of $150 million.

The players

Aquila Commercial

This real estate firm is a major player in the Central Texas market and part of the venture that acquired the building.

KBS

This California-based investment firm served as the seller of the office tower.

JLL Capital Markets

This global commercial real estate services company acted as the broker representing the seller.

Glendon Capital Management

This investment management firm is one of the partners in the joint venture that purchased the downtown tower.

Palmatum Ventures

This venture group is the third member of the partnership that acquired the office asset.

The details

JLL Capital Markets brokers facilitated the sale of the building from the California-based investment firm KBS. The purchasers have stated their intent to invest in the building's amenities and infrastructure to enhance the overall experience for those working in the space.

The office tower was appraised at $150 million in 2022.
KBS officially listed the property for sale in early June 2026.
The sale of the 515 Congress Avenue tower was reported on September 24, 2026.

Culture Shift

The acquisition reflects the broader trend of adjusting commercial property valuations within the Downtown Austin market. This transaction follows the pattern of price corrections observed in the city’s office sector since 2022.

Tenants currently leasing space in the tower may see upcoming changes to property amenities as the new owners begin their planned investments. The shift in ownership also marks a change in management, which could impact daily building operations for workers in the downtown core.

The takeaway

Commercial property investors are increasingly active in Austin, seeking to revitalize older assets through strategic capital improvements. This trend highlights the importance of asset modernization in maintaining high occupancy rates in competitive urban markets.