Zynga has put its San Francisco headquarters up for sale, according to a report by from the San Francisco-based blog SFist. The number of the mobile gaming company’s employees is down by around 2,300, or so–significantly lower than its peak of over 3,500, suggesting that now it needs less space than before.
Don’t need cash
Zynga bought this space from Sega for $228 million. Given the boom in San Francisco real estate, the price the space will fetch will be much more now than it was then. According to The Registry blog, the headquarters’ market value was roughly $340 per square foot when the gaming company bought it, but now its market value is $800 per square foot.
Even during its fourth-quarter conference call, the gaming firm admitted that the reports on the sale of the headquarters are true. It is planning to sell the building and use the proceeds to take out a long-term lease. Right now, the gaming company is exploring its options. If it sells, then it plans to lease it back so its employees can stay in the building, says VentureBeat
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Putting its headquarters in the market to raise cash and keep anxious investors from bolting does not look good though. As for needing cash, the game company doesn’t need any as it has more than $900 million on its balance sheet already.
Zynga: rise, fall and stabilization?
Zynga, which is a major social game developer with more than 232 million monthly active users, was founded in 2007; it grew dramatically on Facebook through games like CityVille, FarmVille, FrontierVille, etc. In 2011, it went public at a $9 billion valuation, but after that, it faltered. The company went through many obstacles to get its footing in mobile games, and its popularity on Facebook’s desktop platform also started to decline.
To bring the company back to its past footing, Mark Pincus, the company’s founder, brought in former Electronic Arts and Microsoft Xbox executive Don Mattrick, and under his leadership, Zynga acquired NaturalMotion for $527 million. However, Mattrick left in April 2015 after he found the turnaround task to be a tough one. Thereafter, Pincus returned to the CEO Job.
For the past nine months, Zynga has been doing all it can to improve its condition. Presently, the market value of the gaming company is around $1.9 billion. Zynga’s share price has stabilized over the past year at a little over $2.