Broadcom Ltd. is exploring a sale of one or more buildings now under construction at its new office campus at the Great Park Neighborhoods development site in Irvine, according to real estate sources.
The Singapore-based chipmaker is currently building four midrise buildings at its 73-acre Great Park Neighborhoods site on the southern edge of the former El Toro Marine base, near the intersection of the San Diego (I-405) and Santa Ana (I-5) freeways and close to Irvine’s train station.
The multibuilding project, which broke ground about a year ago, is the largest commercial office project to be built in Orange County in about a decade.
The company—which finalized a change in ownership about two months ago—is now leaning toward not occupying the entirety of the buildings now under construction, according to real estate sources familiar with the company’s plan.
Broadcom executives declined to comment for this story.
At least one of the four buildings now under construction, and perhaps more, could be sold by Broadcom, according to those sources. A potential asking price has not been disclosed for the buildings, which are still a year away from completion.
Excess land owned by Broadcom at the site is not expected to be sold, at least for the time being, sources tell the Business Journal.
The potential sales plan is a result of Broadcom’s executive team—which is largely based in San Jose—looking to better right-size its Irvine operations and facilities amid recent cutbacks here and abroad, those sources said.
Broadcom announced in February nearly 700 job cuts in Irvine, including the core of its local executive team.
The cuts represented nearly 30% of Broadcom’s local operations overall.
The local job cuts were part of a nearly 1,900-employee reduction in global positions for Broadcom, and came a few weeks after the chipmaker, previously known as Broadcom Corp., completed its $37 billion sale to Avago Technologies Ltd.
That deal ended the company’s 20-year history as a locally based company.
Avago took the Broadcom name but has its executive team based in Silicon Valley, where President and Chief Executive Hock Tan spends most of his time and the company has a significant office presence.
The first phase of development at the new Irvine campus was initially billed as a five-building project totaling 1.1 million square feet, with an opening slated for late 2017 or early 2018.
At its peak, Broadcom leased more than 900,000 square feet at Irvine’s University Research Park. The chipmaker has long been Orange County’s largest office tenant.
The Great Park site has the potential to expand to 2 million square feet of office space in future development phases.
Broadcom paid about $156 million, factoring in land prices, taxes and other fees, for the site in March 2015, after announcing a deal was in place in November 2014.
Development of the entire campus was expected to cost the company close to $800 million, factoring in the land price, construction costs and relocation costs, according to regulatory filings.
Broadcom Corp. announced its planned sale to Avago in May 2015.
Aliso Viejo-based FivePoint Communities, the master developer of the Great Park Neighborhoods, said any potential changes in ownership at the new Broadcom campus wouldn’t have a negative impact on the property.
“The Broadcom parcel is a major piece of our master planned community,” said Emile Haddad, FivePoint chief executive, in a statement.
“We have built into our agreements rights and guidelines to insure that what is built on any of the land we own fits our plans and doesn’t compromise the vision the city of Irvine has for this area,” he said.
“We know that the world is not static,” he added. “We know that companies move and shrink and change ownership. It is part of the business landscape and we are prepared for these realities in our planning and our agreements.”
