Business software maker Epicor Software Corp. is expecting to start life as a private company in a new Irvine headquarters.
The company—which is being bought for $976 million by London-based private equity firm Apax Partners LLP—recently signed a deal to move its local operations to the Lakeshore Towers office complex near John Wayne Airport.
Epicor’s software helps companies manage operations, back-end tasks and customer relationships. It’s set to get its name on top of the 18-story building at 18101 Von Karman Ave.
The company is leasing about 68,000 square feet of space, taking up three of the office tower’s top four floors, according to regulatory filings.
The building, alongside the San Diego (I-405) Freeway, is owned by Los Angeles-based landlord Lakeshore Towers LP.
Filling Hole
Epicor’s lease fills much of a hole at Lakeshore Towers left by Edison Mission Energy, an owner and operator of power plants that had been leasing about 90,000 square feet there.
Edison Mission, a unit of Rosemead-based Edison International, moved to Santa Ana’s 3 MacArthur Place office earlier this year.
The Santa Ana building, owned by El Segundo-based Highridge Partners, recently was put up for sale.
Epicor’s pending relocation won’t add any commuting time for its 250 or so local employees, who work in a variety of executive, sales, marketing, development and customer support positions.
The company’s new building is across the street from Epicor’s current headquarters in Irvine Towers, owned by Newport Beach-based Irvine Compay.
Epicor is expected to move this summer.
The new deal is a slight reduction in space for Epicor, which in 2010 ranked as Orange County’s fifth-largest software company based on revenue of $440 million.
It has been leasing about 74,000 square feet at Irvine Towers, according to filings made with the Securities and Exchange Commission.
In addition to the 68,000 square feet the company is initially taking at Lakeshore Towers, Epicor has the right to expand the deal by 10,000 square feet within the first two years of the lease.
Lower Rent
The Lakeshore Tower lease will see the company pay about $129,000 in rent a month at the start of the lease, which works out to monthly rates of about $1.89 per square foot.
Rents for the 10-year lease will increase to about $2.47 per square foot by the end of the deal.
Epicor’s seven-year lease at Irvine Towers saw the company’s rent start at $2.11 per square foot and go to $2.46.
The new lease also calls for Lakeshore Tower’s owner to update the building’s main lobby and provides rent credits for up to $3.7 million—or about $55 per square foot—for improvements, according to regulatory filings.
Buyout
The relocation news comes as Apax Partners’ bid to buy Epicor and take the company private is moving ahead. The deal is expected to close this quarter.
The deal values Epicor at 11% more than Wall Street had before the offer.
Epicor now has a market value of about $740 million (Apax’s offer factors in debt).
The move is part of a pair of deals by Apax valued at $2 billion.
Apax also is buying Northern California’s Activant Solutions Inc. and plans to combine the maker of software for retailers and distributors with Epicor.
Epicor is set to be the surviving entity in the deal.
Activant leases about 80,000 square feet at its Livermore headquarters, in a deal that runs through next year.
