Hyundai Sticks with its California Stomping Ground for New $150M North American HQ
- Sep 16, 2010
September 16, 2010
By Barbra Murray, Contributing Editor
Korean firm Hyundai Motor Co. has maintained its North American headquarters (pictured) in California’s Orange County since the automobile manufacturer’s U.S. debut in 1985, and that is not about to change now. After shopping around for other locales to accommodate a bigger and better facility, the company has announced that it will stay put and erect a new $150 million headquarters building on its existing 19-acre campus in Fountain Valley.
“We looked at all of the options,” Chris Hosford, Executive Director of Corporate Communications with Hyundai Motor America, told CPE. “There was another large Asian car company that relocated out of California, and it would have been imprudent from a business standpoint not to look at that. But we ultimately decided that California is the best place for our operations and we are happy to stay here.”
Located just off the 405 Freeway about 35 miles south of Los Angeles, Hyundai’s current home consists of a 220,000-square-foot structure that the company has long outgrown. Its new LEED-certified digs will be twice as large, with approximately 500,000 square feet of floor and garage space to accommodate 1,400 employees. Development of the new headquarters is on track to commence in mid-2011, ultimately creating 1,530 new construction jobs with a sorely needed economic output totaling $273 million, according to figures from the Los Angeles County Economic Development Corp. The project, which constitutes the largest investment Hyundai has ever made in California, marks a major financial commitment to the state on the company’s part.
Hyundai’s employees will relocate to leased office space to make way for the demolition of the existing building. “We haven’t made a decision yet, but it will be within a couple of miles of the current location,” Hosford said. If office market conditions continue along the same path for a while, Hyundai may have a bit of a challenge finding suitable temporary housing in Fountain Valley. Although the overall vacancy rate in the city is 11.6 percent, the amount of space available for immediate lease totals just 229,000 square feet, according to a second quarter report by commercial real estate research firm Delta Associates. However, should the company decide to move a little farther from its current location while remaining in the Airport Area submarket, it would probably have better luck in the Irvine Business Complex neighborhood where nearly 2.5 million square feet of the total existing 10.8 million square feet of office space is ready and waiting for occupancy.
No matter which office property Hyundai settles on for its interim accommodations, the lease agreement will be a short one; the company has mapped out a plan to wrap up construction of the new headquarters facility by the close of 2012.