Irvine’s Blizzard Entertainment Inc. is said to be considering building a headquarters complex as it seeks more space to handle its growing online video game operations, according to real estate sources.
Blizzard, whose “World of Warcraft” series has made it the world’s largest online game company, has explored building an office campus in or around Irvine, according to area brokers and other real estate executives.
Estimates for the size of the complex run from 700,000 square feet to 1 million square feet, according to sources.
Such a development, if it goes ahead, would be the largest office project in Orange County to break ground in about five years.
A deal of that size also would be a major step up in space for Blizzard, the county’s largest software company with nearly $1.7 billion in revenue in the past year.
Low Profile
The company, part of Santa Monica’s Activision Blizzard Inc., now leases about 335,000 square feet of offices in the Irvine Spectrum. It’s nearly tripled the amount of space it leases here in the past four years.
So far, a rumored deal involving Blizzard is much heavier on buzz than facts.
The company keeps a relatively low local profile. Any deal would appear to be at least months away from being completed.
Rather than move ahead on a more costly development, the company also could use the soft office market to get a bargain on additional existing space near its headquarters, sources said.
Brokers not directly involved with Blizzard said industry chatter about a new headquarters has been growing throughout the year.
Tenant brokers with Lee & Associates Inc., which represents Blizzard, directed inquiries to the company.
The company didn’t comment on any specific plans.
“Over the course of our business, we’ve learned we need to actively explore various real estate opportunities that exist within the market at any given time,” Blizzard said in a statement. “There have been instances in the past when we could have benefited more from knowing exactly what was out there in terms of availability and pricing trends, so we now make it a habit to stay on top of the market.”
Blizzard started in 1991 and moved into its current headquarters—the former home of chipmaker Broadcom Corp.—in 2007.
The company more than doubled its space in that move, which included three buildings totaling about 235,000 square feet of space.
Part Fantasy
Blizzard’s iron-gated campus—which is part college campus, part fantasy world, complete with a Blizzard library, museum, cafeteria and a giant statue of an orc—filled up quickly.
The Business Journal last month estimated Blizzard employs more than 1,700 people in OC, up from 1,100 a year ago.
The company’s website lists openings for another 90 or so positions in Irvine.
Last year, it leased two additional buildings near its campus to accommodate its growing number of employees.
Keeping an eye on the real estate market “worked out well for us last year when we expanded into 100,000 square feet of extra space, and it’s something we plan to continue doing on a regular basis,” a company spokesman said.
All told, Blizzard leases about 445,000 square feet of office space in North America for its product development and publishing facilities, according to regulatory filings.
Locations include a call center in Austin, Texas, of about 65,000 square feet.
The company’s growth appears set to continue at a pace that would readily afford a larger headquarters.
Last month Blizzard reported first-quarter sales of $357 million, up 17% from a year earlier.
Blizzard posted an operating profit of $170 million in the quarter, up nearly 8% from a year earlier.
Its latest multiplayer online game “World of Warcraft: Cataclysm” was released last year and broke records for the company, selling more than 3 million copies in 24 hours.
Blizzard’s customers pay about $40 for the game and $15 a month to play it online. The game features two fictional races fighting for control of a fantasy world.
“World of Warcraft” counts more than 12 million users.
Likely Partner
Newport Beach-based Irvine Company—the county’s dominant developer and largest land owner—is Blizzard’s landlord at its current three-building headquarters campus. Leases for those buildings are believed to run for several more years.
If Blizzard opts to build a campus elsewhere in Irvine, the developer is seen as its most likely partner.
Irvine city records show plans for a trio of offices, totaling about 270,000 square feet, proposed for University Research Park. No other plans for large office projects are believed to be on file with the city.
University Research Park is owned by Irvine Co. and University of California, Irvine.
Irvine Co. was behind the area’s last big build-to-suit office campus, the 45-acre campus for Broadcom that opened in 2007 at University Research Park. The lease for the project was struck in 2004.
Broadcom initially took over eight new buildings at the campus, which totaled 685,000 square feet of office, laboratories and other space.
It has since added several buildings, including two smaller offices in April.
