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Tuesday, Dec 5, 2023

OC Insider: Office Games

It’s a season of change for Irvine-based video game maker Blizzard Entertainment, the creator of World of Warcraft and other titles, and long the largest software company based in OC by headcount with over 2,500 workers estimated to work here.

July saw the Federal Trade Commission losing an attempt to stop Xbox maker Microsoft (Nasdaq: MSFT) from buying Santa Monica-based parent company Activision Blizzard (Nasdaq: ATVI).

The FTC’s courtroom challenge had been one of the larger roadblocks remaining before Microsoft could complete its long-planned $69B buy of Activision, first announced in early 2022.

The two companies are now aiming to close the mega-deal before Oct. 18; they still must resolve regulatory issues in the U.K., among other matters, prior to then.

Irvine’s Blizzard is no stranger to changes in ownership, with numerous sales and buyouts for it and its parent companies since its founding in the early 1990s.

The last change took place in 2013, when Activision Blizzard split from French media group Vivendi in an approximately $8 billion buyout.

July was also the reported date for a new return-to-work policy to kick in at Blizzard Entertainment’s Irvine campus. Workers there had largely been working remote since the onset of the pandemic; they’re now expected to come in three days a week.

Blizzard as of a few years ago was the largest office tenant in OC. Its cluster of offices, primarily along Alton Parkway near the San Diego (405) Freeway, totaled nearly 740K SF prior to the pandemic, according to regulatory filings.

A downsizing in Irvine seems likely. A recent local office report from brokerage Cushman & Wakefield hinted that Blizzard is looking to shed some of its footprint in lieu of a smaller, consolidated campus within the county.

Irvine Co. and Olen Properties are Blizzard’s two main landlords in OC. Sources tell the Business Journal that if a consolidation moves ahead, a good portion of any vacated offices would likely be converted to more lucrative medical uses, given the proximity of Hoag and Kaiser Permanente’s Irvine campuses a few blocks away.

It’s been a busy period of local sales for Five Point Holdings (NYSE: FPH), the master developer heading up the Great Park Neighborhoods in Irvine.

In the second quarter, a unit of the company that oversees the Great Park Neighborhoods recognized $357.8 million of revenue, thanks to the sale of roughly 800 home sites at a pair of communities there, according to CEO Dan Hedigan.

Property records indicate longtime partner Lennar (NYSE: LEN) closed on a large portion of land in Irvine a few months ago.

The revenue brought in from the land sales isn’t far off the market cap of FivePoint, valued at around $520 million as of last week.

Given that the assets of the company far exceed its valuation, an analyst asked Hedigan during the company’s latest earnings call if FivePoint would consider a sale of the company.

“It’s not something that we have on the table,” Hedigan said. But if “something like that came up, we would always look at those alternatives” to increase shareholder value.

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Sonia Chung
Sonia Chung
Sonia Chung joined the Orange County Business Journal in 2021 as their Marketing Creative Director. In her role she creates all visual content as it relates to the marketing needs for the sales and events teams. Her responsibilities include the creation of marketing materials for six annual corporate events, weekly print advertisements, sales flyers in correspondence to the editorial calendar, social media graphics, PowerPoint presentation decks, e-blasts, and maintains the online presence for Orange County Business Journal’s corporate events.

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