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Valeant Strikes Deal To Move HQ to Aliso Viejo

Drug maker Valeant Pharmaceuticals International is moving its headquarters and about 500 workers from its longtime home in Costa Mesa to Aliso Viejo.

The move should take place by the end of the year, according to Valeant.

The company signed a lease this month to take space in the former headquarters building of Fluor Corp.

The engineering and construction company moved its headquarters to Texas earlier this year and still has operations in Aliso Viejo.

Valeant, which makes drugs for neurology, infectious diseases and skin inflictions, plans to take all of a four-story, 109,948-square-foot building at One Enterprise Drive. Improvements to the building are under way.

The lease is for 10 years. Financial terms weren’t disclosed.

“We were looking at lots of opportunities and alternatives,” said Timothy Tyson, Valeant’s chief executive. “We wanted to get in a stand-alone building that had the same feel” as the company’s Costa Mesa offices.

The Aliso Viejo office “will be a good fit for us,” Tyson said.

“Most of our workers should have about the same commute,” said Tyson, who lives in Newport Coast.

Valeant is the second big company to announce plans in Aliso Viejo this year.

In April, Newport Beach-based Pacific Life Insurance Co. said it is set to move up to 1,000 workers to an office building that’s about to break ground there. Pacific Life is expanding in Aliso Viejo and keeping its Newport Center headquarters.

In 2008, Pacific Life, Orange County’s largest private company, expects to take an eight-story, 242,000-square-foot building going up at the Summit Office Campus.

“It’s becoming clear that Aliso Viejo is no longer just the younger brother to the Irvine Spectrum,” said John Desper, vice president for the Newport Beach-based office of CB Richard Ellis Group Inc.






Fluor’s old HQ: Valeant taking 110,000 square feet

Valeant’s relocation marks a break from the past for the company formerly known as ICN Pharmaceuticals. It long has been based in the sober black Costa Mesa complex that it owns just off the San Diego (I-405) Freeway.

The company is looking to sell the 177,000-square-foot headquarters, in part to improve its balance sheet and to distance itself from its days as ICN under founder and former chief executive Milan Panic.

The Costa Mesa complex has been closely identified with Panic, who was ousted by dissident shareholders in 2002.

An iconic oil painting of Panic once hung in the lobby, while hallways were lined with pictures of the onetime prime minister of Yugoslavia with dignitaries.

The move “gets the legacy behind us, and will help us move forward,” Tyson said.

Real estate brokers believe the company can get close to $50 million for the 15-acre, three-story Costa Mesa complex. The Hyland Avenue site is zoned for another 55,000 square feet of extra office development, which could boost the property’s value.

A deal for the Costa Mesa campus is expected by year’s end, according to Tyson.

The office sale and relocation is part of a restructuring plan that Valeant set forth in April. The plan, designed to reduce costs and boost profits, includes management consolidation and a reworking of research and development.

Valeant took a $15 million charge in the third quarter related to the restructuring. For the year, charges are expected to be $90 million to $115 million.

The measures are expected to save the company more than $50 million next year.

The Costa Mesa building includes about 70,000 square feet of laboratory space, along with offices. The lab operations won’t be making the move to Aliso Viejo, which is all offices.

Long term, the company’s restructuring plan cuts the need for the Costa Mesa lab space, Tyson said.

Meanwhile, Valeant could lease back lab space in Costa Mesa for a few years after a sale, he said.

Valeant employs an estimated 500 people in Costa Mesa and Irvine. About half of them work in jobs related to research and development, according to Business Journal estimates.

There’s been a lot of activity at Valeant’s new headquarters in the past year.

In summer 2005, Fluor sold the Aliso Viejo building to San Francisco-based RREEF Funds LLC, an investor unit of Germany’s Deutsche Bank AG, for a reported $27.5 million.

Fluor had an 18-month lease for the building and surprised the new landlord by exercising an option to leave the building early this summer.

Many of the Fluor executives once at the building moved to its new headquarters in Irving, Texas. About 1,100 Fluor workers stayed behind, mostly engineers. They work at smaller, less formal offices in Aliso Viejo and University Research Park in Irvine.

Fluor said recently it expects to hire roughly 300 engineers locally to handle oil and chemical industry work.

Desper and CB Richard Ellis’ Ted Snell and Allison Schneider represented RREEF in the Valeant lease. The Newport Beach-based office of Cresa Partners LLC represented Valeant and is handling the Costa Mesa campus sale.

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Mark Mueller
Mark Mueller
Mark is the Editor-in-Chief of the Orange County Business Journal, one of the premier regional business newspapers in the country. He’s the fifth person to hold the editor’s position in the paper’s long history. He oversees a staff of about 15 people. The OCBJ is considered a must-read for area business executives. The print edition of the paper is the primary source of local news for most of the Business Journal’s subscribers, which includes most of OC’s major corporate and community players. Mark’s been with the paper since 2005, and long served as the real estate reporter for the paper, breaking hundreds of commercial and residential real estate stories. He took on the editor’s position in 2018.
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