Press release: 1998-06-11: San Francisco Lands Sega of America Headquarters

This is an unaltered copy of a press release, for use as a primary source on Sega Retro. Please do not edit the contents below. Language: English Original source: The Free Library

San Francisco Lands Sega of America Headquarters; Up to 800 Jobs for Multimedia Gulch

SAN FRANCISCO--(BUSINESS WIRE)--June 11, 1998--In one of the most significant headquarters relocations to San Francisco this year, Sega(R) of America, Mayor Willie L. Brown, Jr. and the San Francisco Partnership announced today that Sega's U.S. headquarters and two sister firms, SegaSoft Networks, Inc.(TM) and Sega Entertainment, Inc., will move to Multimedia Gulch.

The company confirmed that it has signed a 10-year lease at The Townsend Center, at 650 Townsend Street, for 160,000 square feet, bringing up to 800 jobs to the City. Sega will move into the new headquarters on January 4, 1999.

"Sega is excited to be moving to San Francisco, the birthplace of interactive media," said Bernard Stolar, president and chief operating officer for Sega of America. "A dynamic creative community and one of the world's best places to live and work make San Francisco the ideal location for Sega, particularly as we prepare to launch our super console video game system, Dreamcast(TM), in 1999."

"Sega's move to our fine city solidifies that San Francisco is the global hub of multimedia," said Mayor Brown. "Companies are drawn here not only for the talent and quality of life, but for the unique cluster of peers and partners they can find here. San Francisco will continue to create innovative solutions that nurture and grow this important industry."

San Francisco's interactive media industry continues to play a key role in the Bay Area's booming economy, generating $2.2 billion total revenues in 1997, an increase of 135 percent from 1995, according to a benchmark study recently released by the San Francisco Partnership, MDG.org and Coopers & Lybrand. Although the industry is just over a decade old, the business already employs half as many people as the finance, insurance, real estate sector -- traditionally the strength of the city's economy. More than 35,000 workers were employed in interactive media jobs at the beginning of 1998 -- a 70 percent increase over 1995(1).

"Not only is Sega a leading brand name in interactive media, but the company will attract significant businesses including video game and software developers, web site and Internet content producers and other professional service providers," said Mara Brazer, managing partner of the San Francisco Partnership, a public-private economic development corporation that played the coordinating role bringing all parties together necessary to make the deal happen. "With access to the creativity, energy, talent and resources that this city is famous for, Sega's relocation will create hundreds more opportunities than the 800 jobs it plans to bring in. The U.S. headquarters of Sega is a huge win for Multimedia Gulch and San Francisco."

A team from the San Francisco Partnership and the Mayor's Office of Economic Development were instrumental in landing the Sega deal. Experts identified significant location enticements, including the New Jobs Tax Credits and State Enterprise Zone incentives, which helped attract this major corporation to the South of Market area.

These incentives coupled with the lease package from The Townsend Center will allow Sega to reduce its corporate office costs with the move from its Redwood City headquarters, where office vacancy rates are at less than two percent and rents are higher than those in the South of Market area.

Centrally located in Multimedia Gulch at 650 Townsend Street, Sega has leased the entire sixth floor and half of the fifth floor. Formerly known as the Fashion Center, it is one of the most technologically-advanced buildings in the Bay Area and has room for Sega's fiber optics and back-up generator needs. Sega also will use the building's renovated atrium area for new product launches and promotions.

"650 Townsend provides Sega with the most up-to-date and technologically-advanced building environment in the entire Bay Area, which meets or exceeds their requirements," said Joe Mock for ZORO. "We have provided extra service capacities to convert this into one of the most attractive workspaces for today's multimedia professionals."

In its new Townsend Center headquarters, Sega joins other multimedia tenants, such as Ziff-Davis, Inc., Focal Communications Group and Viant, formerly known as Silicon Valley Internet Partners. The building was purchased in 1997 by the ZORO LLC. It has been extensively refurbished into a working, urban campus environment with a spacious atrium to fit the needs of the rapidly growing multimedia industry in San Francisco.

Established in early 1996, the San Francisco Partnership is a public-private partnership that works to attract and retain businesses, primarily through marketing efforts, troubleshooting impediments and creating a more favorable environment for business. Its primary goal is to increase jobs in San Francisco.

Sega of America is the arm of Tokyo, Japan-based Sega Enterprises, Ltd. responsible for the development, marketing and distribution of Sega video game systems and videogames in the Americas. Sega Enterprises, Ltd. is nearly a $3.0 billion company recognized as the industry leader in interactive digital entertainment media, and is the only company that offers interactive entertainment experiences both inside and outside the home. Sega of America's World Wide Web site is located at http://www.sega.com.

The Townsend Center, a 700,000 square foot commercial building opened in 1990, is owned and operated by ZORO LLC, a group of Northern California real estate leaders consisting of Martin Zankel, Bernard Osher, Irving Rabin and Buzz Oates. ZORO acquired the six-story, atrium-styled building and converted it into a multimedia business service center with David Polatnick of Polatnick Properties and Meade Boutwell of Cushman & Wakefield providing the marketing support. Further information, including photographs of 650 Townsend, can be viewed on its web site at www.650townsend. com.

(1) By comparison, all nonagricultural jobs in San Francisco grew by only 7.6 percent during the same period, according to California Employment Development Department figures.

CONTACT: Access Communications for Sega of America

Dave Karraker, 415/904-7070 ext. 265

or

San Francisco Partnership

Laura Paden, 415/352-8898

or

Laurie Chase & Company for ZORO

Rory Faber, 415/781-1545
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