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Sunday, May 28, 2023

Axonics Inks 146K-SF Deal for New HQ

Irvine-based device maker Axonics Inc. (Nasdaq: AXNX) has inked a nearly 145,500-square-foot deal to relocate its headquarters, in the largest local office lease of the past two years.

On the heels of a record 2022 for sales, Irvine-based device maker Axonics Inc. (Nasdaq: AXNX) has inked a nearly 145,500-square-foot deal to relocate its headquarters, in the largest local office lease of the past two years.

The company has signed a deal to occupy a full building and part of a second at the Sand Canyon Business Center, an Irvine Co.-owned office complex at the intersection of Sand Canyon Boulevard and Irvine Center Drive.

The buildings, a few blocks from Irvine Valley College, will serve as the nearly $3 billion-valued firm’s new headquarters starting next year.

It’s the largest office deal for OC since early 2021, when Anduril Industries leased the entirety of The Press in Costa Mesa, which will total some 640,000 square feet at buildout.

Axonics will consolidate its current offices elsewhere in the city to the buildings, including the entirety of 15515 Sand Canyon Ave., a 119,115-square-foot property, and a 26,371-square-foot office in the adjacent building at 15525 Sand Canyon Ave.

The new office marks a significant expansion in local space for Axonics, which develops products for the treatment of bladder and bowel dysfunction. It touts its implant to treat overactive bladders as one of the most successful debuts in American medical device history.

That debut was exemplified by nearly 4,500% growth in revenue from 2019 to 2021, placing it first on the Business Journal’s list of Fastest-Growing Midsized Public Companies in 2021.

Axonics had 650 companywide employees as of the end of last year.

Irvine Footprint

Irvine Co. has agreed to pay up to $8.5 million in tenant improvements as part of the lease, which spans 10 years and begins April 1, 2024, with monthly rents starting at $2.15 per square foot, regulatory filings indicate.

Axonics currently occupies about 75,000 square feet across four offices in Irvine.
By the end of next year, it will have terminated its leases at 7575 Irvine Center Drive, 26 Technology Drive and 15326 Alton Parkway, where it occupies roughly 70,000 square feet in total.

Its main headquarters are currently at 26 Technology Drive, within Irvine Co.’s Alton/Technology Business Park.

At another Irvine Co. campus, Technology Link, Axonics occupies space across five suites at 18 Technology Drive. It has extended its lease at the 59,335-square-foot building through the end of next year to accommodate the company as it builds out its new offices.

Axonics’ new offices in the Sand Canyon Business Center, which includes seven buildings totaling 665,000 square feet, were built in 2000.

Record Growth

The company’s fourth-generation rechargeable sacral neuromodulation system received FDA approval earlier this year. A patient previously needed to recharge the Axonics device for one hour every month.

The fourth generation reduces that to one hour every six months and the device can last more than 20 years in the body.

At the start of the year, the company reported fourth-quarter revenue climbed 61% to $86 million, topping the $78.1 million expected by analysts.

“This quarter’s record revenue result reflects the growing demand for our best-in-class incontinence products,” CEO Raymond Cohen said in a statement at the time.

Cohen, who co-founded Axonics in 2013, has a long history in medical devices. Accolades include winning an Excellence in Entrepreneurship Award from the Business Journal in 2002, for his work with a prior company, Cardiac Science Inc., an Irvine defibrillator maker.

2023 Expectations

Axonics expects that growth to continue, forecasting 2023 sales will climb 25% to $342 million, topping the average analyst estimate for $329.9 million.

The company is scheduled to report first-quarter financial results after the markets close on May 1.

Axonics went public in 2018 with shares opening around $15; shares have since surged to nearly $57 as of last week, for a market cap of $2.8 billion, ranking No. 13 on this week’s list of largest public companies in OC (see list, page 18).

The firm isn’t just a fast-growing one in OC.

Last month, Axonics announced it ranked No. 2 on the Financial Times 2023 list of
the fastest-growing companies in the Americas.

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