Apple Inc., which recently completed its expansive campus in Northwest Austin, has been discreetly building a core engineering team across town, fueling a new wave of growth in Central Texas.
The California-based technology giant is pulling back the curtain on its new engineering center, which sits on a bluff in Southwest Austin, near Loop 360 and Bee Cave Road.
Apple, the world’s largest computer electronics company, employs about 500 engineers at the seven-story Capital Ridge office building, Johny Srouji, an executive at Apple, told the American-Statesman.
The newly constructed 215,000-square-foot building has the ability to hold 1,000 workers, and Apple intends to fill it, he said.
“We have been quietly building out this team, which is one of our most important engineering groups,” said Srouji, Apple’s senior vice president, hardware technologies. “They play a very critical and integral role — they are designing chips that go into all the devices we sell.”
The Austin team, which the company began building several years ago, is now Apple’s biggest research and development group outside of its Cupertino, Calif., headquarters. When Apple decided to expand engineering work outside of Cupertino, Central Texas was the natural choice, Srouji said.
“The reason we came to Austin is there is a strong pool of talent,” said Srouji, who previously lived in Austin during stints at IBM and Intel. “There are lots of high-tech companies, and also the University of Texas.”
Apple’s growth in Austin
The Capital Ridge operation is just one piece of Apple’s multi-million dollar investment in Austin. Apple recently completed its sprawling 38-acre campus on West Parmer Lane in Northwest Austin.
The campus, which is responsible for running the company’s business operations for the entire Western Hemisphere, features seven limestone-and-glass office buildings with a combined 1.1 million square feet. The site includes restaurants; smoothie and coffee bars; a full-scale gym with saunas and a wellness center with services including medical, dental and eye care along with acupuncture and massage.
Work done at the site, known as the Americas Operations Center, includes finance, human resources, corporate sales, customer support, information systems and accounting.
Meanwhile, last year, Apple bought the nearby Riata Crossing complex, which has four buildings with 350,000 square feet of space. The company, which had been leasing it, has declined to say what work will be done there.
Apple is in line to receive $35 million in tax incentives from the city, county and state for its Austin expansion. To date, the company has received $10.5 million in incentives payments from the state-operated Texas Enterprise Fund, documents show.
The company says it has already created more than 6,000 jobs in Austin. That makes Central Texas Apple’s largest U.S. hub outside of Cupertino.
The ripple effects are already being felt, economic experts say. Austin economist Brian Kelsey estimates that the Capital Ridge operation alone, with 500 engineering jobs, would result in at least $140 million in new earnings and create about 1,000 spinoff jobs.
“For every one new engineering job created at Apple, we could expect to see approximately two additional jobs created in the region,” Kelsey said.
Apple’s investment, Kelsey said, shows the depth of Central Texas’ tech roots, which can be traced back to IBM and chip makers like AMD, before Austin became known as a global software center and a top place to launch a startup.
“Austin’s tech credentials are well established, but most of the headlines lately have been about startups, access to capital, and the like,” Kelsey said. “Apple’s recent investment serves as a reminder that Austin is a key center of innovation for companies of all sizes, including one of the largest employers and most recognized brands on the planet.”
Austin ‘an ideal fit”
Apple began building its engineering operation in Austin in 2010, with a 100-person team. Over the past several years, the group has been spread out at different locations.
Now, the Capital Ridge site will provide a single base for its 500-person team and give Apple room for a major expansion push.
The company said the group has a range of high-level hardware and software engineering expertise, but declined to give specifics. Jobs in Austin currently posted on the Apple website include CAD engineers, CPU microarchitecture engineers, physical design engineers and power integrity engineers.
“The chip development work they do goes into hundreds of millions of devices every year,” Srouji said. “If they miss a beat, we don’t ship.”
The Capital Ridge offers amenities similar to the Americas Operations Center, including a cafe, espresso bar and a wellness center that offers preventative and urgent care, as well as acupuncture, massage and physical therapy. It also has a fitness center with group and private classes and terraces for Friday afternoon beer bashes.
Roger Kay, an analyst with Massachusetts-based Endpoint Technologies Associates Inc., said building and retaining a world class team in Austin is critical to Apple’s continued growth.
“They have an almost infinite need for really good engineers, and the supply is limited,” he said. “They’ve got plenty of money, but they have fished out Silicon Valley pretty much entirely. For Apple to find more talent, they have to reach out further afield.”
Austin, Kay said, is the right place to mine for talent.
“Thanks to Dell, AMD, NXP and Samsung, all that very specific talent that Apple needs resides in Austin,” he said. “It’s an ideal fit.”