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Thursday, Jun 8, 2023

THQ Likely to Exit 100,000-Square-Foot Offices

The liquidation of video game maker THQ Inc. will likely put onto the market a 100,000-square-foot building in Agoura Hills that had been the company’s headquarters for seven years. THQ, once one of the top U.S. video game publishers, filed for voluntary Chapter 11 bankruptcy protection in December. Most of its assets were auctioned off for $72 million on Jan. 22. For now, a few THQ staff members remain at the 29903 Agoura Road offices as the company completes the sale of many game titles and development studios. The company has been leasing a 103,394-square-foot building owned by Realty Bancorp Equities, a Woodland Hills developer and manager of office, retail and industrial properties in Los Angeles County and the Inland Empire. Attempts to reach Norman Kravetz, principal owner and managing member of Realty Bancorp, were not successful. In a Jan. 23 memo to THQ employees, former Chief Executive Brian Farrell and former President Jason Rubin said there were sufficient resources to pay for employees remaining at the corporate headquarters. The memo did not state how long those workers would remain employed. “We are requesting the ability to offer certain severance pay to minimize disruption for employees of non-included entities as they determine the next steps in their careers,” Farrell and Rubin said in their memo. The day before, THQ auctioned off three game studios; its top-selling game titles, including “Saints Row” and “Homefront”; and games that had been in development, including the anticipated “South Park: The Stick of Truth.” Buyers included U.S. and European video game companies. Assets not included in the auction were the THQ publishing business and Vigil Games, an Austin, Texas-based studio behind the “Darksiders” and “Darksiders II” games released by THQ. Those assets could be acquired by other buyers. THQ’s steep fall from strong competitor to video game giants Activision Blizzard Inc. of Santa Monica and Electronic Arts Inc. of Redwood City to bankruptcy was a combination of changes in the industry and poor decisions on the part of THQ management, according to industry analysts. “They were trying to reimagine themselves as a hardcore gaming company, but they could not string enough games together to make a profit,” said Michael Pachter, who follows the video game industry for Wedbush Securities, a Los Angeles financial services firm. The downfall accelerated following a poor 2011 holiday sales season for its uDraw tablet and software for the Xbox 360 and PlayStation 3 consoles, Pachter said. Within months, THQ cut staff, exited the licensed children’s console game business and risked delisting on the Nasdaq exchange. In June, the company reverse split its stock to get the share price up, a tactic that worked only in the short term. In a five-year period, THQ went from having $400 million in cash to piling up more than $100 million in debt.

Mark Madler
Mark Madler
Mark R. Madler covers aviation & aerospace, manufacturing, technology, automotive & transportation, media & entertainment and the Antelope Valley. He joined the company in February 2006. Madler previously worked as a reporter for the Burbank Leader. Before that, he was a reporter for the City News Bureau of Chicago and several daily newspapers in the suburban Chicago area. He has a bachelor’s of science degree in journalism from the University of Illinois, Urbana-Champaign.

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