Chipotle Mexican Grill Inc. is poised to become Newport Beach’s most valuable public company immediately following its move here from Denver this year.
Building the fast-casual burrito builder into one of the city’s largest employers will take a bit more time, based on the amount of office space it plans to occupy in Newport Center for its headquarters.
Real estate sources point to the 18-story 610 Newport Center Drive office tower across the street from Fashion Island as its landing spot.
It’s expected that Chipotle will take over empty space on two floors of the Irvine Co.-owned building, giving it just under 23,000 square feet of space.
The space was last used by Chicago-based CareerBuilder LLC, which recently downsized local operations and put the space up for sublease.
The furnished offices are configured for 125 desks, according to marketing documents from the Irvine office of JLL, which CoStar Group Inc. records show is handling marketing for the sublease.
Terms of Chipotle’s lease haven’t been disclosed. Monthly rates for other available space in the building start at $4.50 per square foot.
Some Chipotle employees could start moving in in a matter of weeks, sources tell the Business Journal.
Talent Search
In late May, Chipotle made national headlines when it announced the move from Denver, where it began operations in 1993, adding another notable firm to Orange County’s restaurant chain ranks.
The company’s market value is $12.7 billion, which would make it third among OC-based public companies.
Builder William Lyon Homes (NYSE: WLH) is currently Newport Beach’s most valuable public company, with a market capitalization of about $900 million.
Chipotle didn’t give the specific location of its OC office in the announcement, when lease negotiations were still underway, sources told the Business Journal.
The chain has 400 corporate employees in its Denver digs, which it will close (see related story, this page).
Newport Beach had 11 companies that employed more than 400 people as of 2012, according to city records.
An unspecified number of the Denver positions will be moved to Columbus, Ohio.
Relocation of some Denver employees and buyouts for others, plus costs associated with moving offices and other reorganization, are projected to cost at least $115 million, the company said last month.
It’s worth it, according to Chief Executive Brian Niccol.
“We’re building a new culture,” he said in a June 27 investor and analyst presentation, when Chipotle outlined some of its near-term growth plans and longer-term goals.
Expect a lot of hires in Newport Beach as the company pulls talent from other area restaurant chains, Niccol said.
“There’s a lot of talent in the West,” he said, and he would know. Niccol joined the company in April after leading Irvine-based Taco Bell Corp., the largest restaurant chain based in OC.
That talent “wants to be part of Chipotle,” he said.
Taco Bell, a unit of Louisville, Ky.-based Yum Brands Inc. (NYSE: YUM), had $9.8 billion in systemwide sales last year, while Chipotle took in $4.5 billion.
Niccol said in the June 27 presentation that he could see the firm more than double sales to $10 billion.
He said new positions the company will fill locally include marketing, digital technologies, menu development, and data analytics.
“We think we have the ability to really transform the organization in a faster fashion by relocating the company.” But in order to do that, “we need to add talent.”
