Corporate Expansion & Relocation
Princess Cruises Drops Anchor in Valencia
Relocation follows national search
Newhall Land has spearheaded efforts to lure large companies to the Valencia area.
By Charles Lockwood
After a three-and-a-half year search across the United States, Princess Cruises has decided to relocate its data and administrative center and 600 jobs from Century City to the new town of Valencia, which is being developed by The Newhall Land and Farming Company. Princess Cruises will make its move in Fall, 1998.
The third largest ocean-going excursion cruise company in the world and the largest cruise company based on the West Coast, Princess Cruises has signed a 15-year lease with Newhall Land for the top five floors of a new six-story 130,000-square-foot building now under construction on Valencia’s new pedestrian-oriented Town Center Drive. Retail shops and services will occupy the building’s ground floor.
“With its worldwide reputation for innovation and quality, Princess Cruises will be an excellent addition to the businesses located in Valencia and should attract the attention of other major office users in the greater Los Angeles area,” says Thomas L. Lee, Chairman and CEO of The Newhall Land and Farming Company.
Princess Cruises, which operates a nine-ship fleet and sails to more than 200 ports worldwide, has maintained its headquarters in Century City for the last 25 years. An aggressive expansion program, which was initiated eight years ago, has led to a larger office staff and, therefore, the need for expanded new facilities.
Newhall Land, which has spearheaded efforts to lure large companies to the Valencia area, has spent the last two years wooing Princess Cruises to the community. Attracting business to Valencia is so important for Newhall Land that Jim Backer, the company’s Director of Marketing for Commercial/Industrial Real Estate, maintained his Princess Cruises contacts even after the company announced (but later canceled) its move to another location.
One important locational consideration for Princess Cruises was the issue of business taxes. The City of Santa Clarita, whose jurisdiction includes Valencia, does not have a business tax.
But business taxes were only one consideration for the company. “Valencia has all the advantages,” explains Peter Ratcliffe, President of Princess Cruises.
“It has an excellent reputation for schools and safety and a high quality of life. We particularly like the city-center environment being developed along Town Center Drive. We’re in the business of selling dreams. It’s in our best interest to have our people happy where they work, and we believe that they will be happy in the new location.”
“We were also successful in bringing Princess Cruises to Valencia, because we were able to offer a new kind of workplace,” says James S. Backer, Director of Marketing for Commercial/Industrial Real Estate at Newhall Land. “Town Center Drive is not a Century City high-rise far from many workers’ homes, and it’s not a stand-alone suburban office park far from important services and amenities. Instead, Town Center Drive is a contemporary interpretation of pre-World War II Main Streets, offering the best of the big city and the suburb.”
The $100 million Town Center Drive, which runs half a mile westward from the fully enclosed two-story 790,000-square-foot Valencia Town Center regional mall, has been designed as a pedestrian-oriented Main Street, not a busy traffic artery. The roadway is just 53 feet wide from curb to curb. The 10- to 14-foot sidewalks are shaded by trees, and benches are provided in each block. Angled curbside parking calms through-traffic. The bulk of the street’s parking is being tucked behind the buildings in structures or surface
lots.
With its broad mixed of uses-office, retail, entertainment, hotel, and housing-Town Center Drive is becoming Valencia’s community focal point, attracting residents, workers, and visitors from early morning until late at night, seven days a week. All office buildings, including the new Princess Cruises Building, have ground-floor retail space for shops, restaurants, and services that will draw pedestrian activity.
Valencia’s new Main Street is well underway. In September 1996, Newhall Land completed the first Town Center Drive building: a three-story office building at 24300 Town Center Drive with retail and restaurant uses on the ground floors. This project was the first speculative office building to be constructed in greater Los Angeles since the region’s real estate market slumped in 1990. This June, Newhall Land completed the second Town Center Drive building: a 55,000-square-foot Spectrum Health Club.
In addition to the Princess Cruises Building, other buildings currently under construction on Town Center Drive include the six-story 250-room Valencia Hyatt Hotel and a 20,000-square-foot Conference Center adjacent to the hotel.
A 60,000-square-foot entertainment/retail complex that includes a 12-screen multiplex and an IMAX 3D Theater is slated to break ground this Fall. Several additional retail buildings are expected to be constructed on Town Center Drive by the end of the decade, and several hundred apartments are projected to rise at the western end of the street.
“The six-story Princess Cruises Building is one of the most important components of Town Center Drive, because it puts a weekday population on the street,” Backer continues. “Princess Cruises will have a fully staffed operation with 600 employees, who will be customers for local shops and restaurants. That’s just what we needed to make Town Center Drive into a lively pedestrian environment and a genuine community hub for Valencia and the entire Santa Clarita Valley all day long, all year long.”
Once the building is completed, Princess Cruises will relocate the Century City employees in its customer service, accounting, air services, computer services, reservations, sales, and personnel departments, among others, to Valencia. The company will provide relocation assistance to its employees. “We want everyone who works with us to continue to work with us,” says Peter Ratcliffe.
Princess Cruises is the single largest new employer to relocate to the City of Santa Clarita since its incorporation nearly 10 years ago. The 600 jobsbrings an additional $2.7 million to the city’s economy annually. Of particular interest to the City of Santa Clarita, Princess Cruises plans to expand its staff by 40 percent by the end of the decade. “This is very important to our economic base,” says City Manager George Caravalho. “Having a large employer like Princess Cruises inside the City means potential new jobs for citizens here.”
Charles Lockwood is a Los Angeles-based writer who specializes in business topics.
