Orange has long been Volt’s largest corporate hub in terms of its office presence, with a campus in the city that runs nearly 200,000 square feet. However, the company previously designated a smaller, 11,000-square-foot base in Uniondale, N.Y., as its headquarters.
The move makes Volt, with a modest market cap of $62 million, the largest public company based in the city of Orange by market value—for the time being.
Alignment Healthcare, the Orange-based provider of Medicare Advantage plans for seniors, is in line to
Pandemic’s Impact
Volt’s headquarters move to Orange, where it has long maintained a West Coast campus, doesn’t appear to foreshadow an imminent expansion in the area in terms of personnel counts or office space.
Its lease for the Orange campus is its largest real estate expense, and the company is looking to sublease much of the campus to cut costs.
Volt, which hasn’t reported annual net income since fiscal 2011, was drastically affected by the pandemic in key markets it serves. Revenue for the fiscal year ended Nov. 1 fell 18% to $822.1 million. The company in turn increased cost-cutting efforts such as shedding real estate and other expenses.
“We’ve seen industries such as retail, hospitality, and aerospace, previously quite resilient, suffer potentially irreparable harm as a result of COVID-19,” Chief Executive and President Linda Perneau told analysts earlier this year.
Volt provides contingent workers and personnel recruitment services for larger businesses in a variety of industries, primarily supporting professional administration, technical, information technology and engineering positions.
The company’s website said it typically employs an average of 35,000 people. As of Nov. 1, Volt employed less than half that amount—15,600 people, including some 14,500 who were on contingent staffing assignments with its clients—Volt’s latest annual report indicated.
While traditional industries that Volt serves have seen less need for the company’s services, other markets have emerged, Perneau said.
“New opportunities utilizing emerging skills have arisen out of the need to ensure employee wellness and safety and the determination of essential businesses to remain operational,” she said.
“These skills in the areas of healthcare monitoring and screening, logistics, and even food manufacturing and distribution have provided new job opportunities for displaced and unemployed talent,” and is where the company has seen growth of late, she said.
First-quarter results are due from Volt this week.
Real Estate Reductions
Volt previously owned its facilities in Orange at a campus that’s about a mile west of the Costa Mesa (55) Freeway at 2401 Glassell St.
Known as the Volt Corporate Park, the 12-acre campus includes four two-story buildings that total about 200,000 square feet.
In 2016, the local office of real estate investor and developer Hines and financial partner Oaktree Capital Management LP in Los Angeles bought the campus for $35.9 million, in a sales-leaseback deal with Volt that was expected to run until 2031.
At the time of the sales-leaseback deal, roughly 400 Volt employees were said to be working at the site.
Local employee counts now are less than half that, as the company has eliminated some jobs and moved other positions offshore. It has also enacted a work-from-home policy for many employees during the pandemic.
The company took a $14.5 million impairment charge at the end of 2020, related to the four-building campus in Orange, Chief Financial Officer Herbert Mueller told analysts earlier this year.
“We’ve been subleasing one of the buildings … and have an additional five years remaining on that agreement,” he said.
Volt has also vacated “two additional buildings and have consolidated into one building approximately 50,000 square feet,” Mueller said.
“With just over 10 years remaining on our lease, we are actively pursuing multiple options for the two vacant buildings as well as the overall campus. We will continue to evaluate our real estate footprint in order to continue to lower our costs,” he said.
