High-capital companies ink big lease

Andrew Edwards

Orange County real estate titan the Irvine Co. announced Tuesday that

it had completed the largest lease agreement in its history after

Broadcom Corp., an Irvine-based high-tech firm, signed a deal to

lease eight buildings set to go up near UC Irvine.

“We think it’s the biggest lease deal in the history of the

county, because no one we know can recall one that was bigger,” said

Bill Halford, the Irvine Co.’s president of office properties.

Broadcom, which develops and manufactures communications hardware

and software, will lease 700,000 square feet of office space in

buildings expected to be constructed in about two years, Halford

said.

Through the third quarter of 2004, Broadcom earned $1.9 billion in

revenue, an increase over all of 2003’s revenues -- $1.6 billion.

Through 2004’s third quarter, the company amassed more than $900

million in profit.

Under the terms of the deal, Broadcom will lease the buildings for

$183 million over 10 years, said Tom Porter, Broadcom’s senior

director of corporate services.

The new offices will be built at University Research Park, home to

other high-tech offices that frequently work closely with UC Irvine.

Though Broadcom and the university have worked together in the past,

corporate and school officials anticipate their relationship will

grow after Broadcom moves next door.

“Some of [Broadcom’s] staff will be coming to engineering classes,

and some of the staff will be teaching engineering summer classes,”

UC Irvine Chancellor Ralph Cicerone said.

“They’ve hired UC Irvine interns in the past, and it will be

easier now.”

Broadcom’s co-founder and chairman Henry Samueli is a member of

the UC Irvine Foundation, and the engineering schools at both UCI and

UCLA bear Samueli’s name.

“Henry spends a fair amount of time on our campus,” Cicerone said.

In choosing the location of the new offices, Porter said Broadcom

had three major considerations: Many of their employees at their

current Irvine offices live in the area; the site is close to John

Wayne Airport; and the new site offers access to the university.

“Having a proximity to the campus did play a part in it,” Porter

said, adding that while specifics of the evolving relationship

between the school and the company are still being discussed, talks

have touched on recruiting UC Irvine students and giving Broadcom

employees access to university resources.

* JEFF BENSON covers education and may be reached at (714)

966-4617 or by e-mail at [email protected].