The Irvine-based firm, valued at nearly $12 billion, recently inked a deal to take over a 127,000-square-foot building located next door to its distinctive headquarters in the Spectrum area of the city.
The lease is among the three largest reported for an office or flex building reported in Orange County this year, according to brokerage data.
The deal marks a big boost to Masimo’s area real estate holdings. It counted some 400,000 square feet of owned and leased properties in the area as of the start of 2021, according to the company’s latest annual report.
The new facility is for the entirety of 58 Discovery, a two-story office previously used by the in-flight entertainment division of Thales USA Inc. for its domestic headquarters.
Thales, which has been slimming down its local operations amid the slow market for the airline industry, put the building up for sublease earlier this year, according to brokerage data. It leases other buildings in the area.
The 58 Discover building is owned by Irvine Co., which paid a reported $35.7 million for the two-story property in 2018.
It hasn’t been disclosed whether Masimo plans to use the new facility to add more workers, or, like many companies readjusting their real estate plans coming out of the pandemic, have its existing base of local workers spread out among a larger collection of properties.
Company officials could not be reached for comment on the lease last week, and brokers involved in the deal declined to comment, citing confidentiality agreements.
Brokerage data indicates the new lease at 58 Discovery will begin in July. The building was largely empty as of last week, with no signs of construction underway for the new tenant.
Masimo employed about 700 people in Orange County as of earlier this year, according to Business Journal records.
The company said in its latest annual report that in 2020 its companywide workforce “grew at a faster pace than past years,” and increased from about 1,600 full-time employees and 3,700 contract personnel to 2,000 full-time employees and 4,200 contractors.
Portfolio Topping 500K SF
The deal is the largest area real estate move for Masimo in seven years.
Masimo bought its current headquarters facility, a 213,430-square-foot building at 52 Discovery, in 2014 for a reported $56 million; it also owns a separate building in the area, and over the years has leased spaces in several other buildings in the area from Newport Beach’s Irvine Co., the largest landlord in the Spectrum area.
Both 52 Discovery and 58 Discovery face the Eastern (133) Toll Road, and sit between the San Diego (405) and Santa Ana (5) freeways.
Masimo’s existing headquarters has a prominent glass rotunda, a distinctive feature that has landed it in several movies during its history.
The device maker’s local operations house the majority of its research and development activities, though the firm also owns a manufacturing facility in New Hampshire and an international headquarters office in Neuchatel, Switzerland, according to regulatory filings.
The company is best known for products it calls Signal Extraction Technology. They are pulse oximetry devices that help doctors and nurses monitor blood, oxygen and other key metrics of patients without needles.
Masimo’s technologies are used to monitor more than 200 million patients annually. Its products are primarily used in hospital settings, though during the pandemic they were increasingly used to remotely monitor patients, including those with COVID, from the home.
Masimo had $1.14 billion in annual sales in 2020, a 22% jump from 2019 and a nearly 70% jump from 2016.
Revenue jumped about 11% in the first quarter of 2021 to $299 million.
The company has almost doubled its market capitalization since the start of the pandemic.
“As the healthcare industry shifts toward hospitals, physicians and providers being rewarded by payers based on the quality and value of the services (as opposed to the volume of fee-for-service transactions), we expect to see more hospitals gravitate towards technologies like Masimo SET that have a proven track record of improving patient care,” the company said in its latest annual report.
Sublease Offering
Masimo appears to be subleasing 58 Discovery from Thales in a deal that runs through 2025, according to marketing materials for the property.
JLL had the listing for the building, which was built in 2000. The building is described as “mid-tech” with about 75,000 square feet of office space, along with research and development space.
