Koll to Close California Headquarters

Koll Development Co. said Friday that it would close two of its California offices, including its longtime headquarters in Newport Beach, as part of a reorganization that began last year after the departure of company founder Don Koll.

The shake-up comes as Koll and other real estate firms cut staffs and costs to deal with a prolonged slump in real estate leasing and development activity in California and the nation.

Koll has cut its staff by about 40% since last year as the company shifts from risky, speculative development to focus on more conservative projects built and paid for by specific clients.

“Even though the pipeline of prospects and deals is relatively strong ... everybody is delaying new capital expenditures on new facilities,” said Koll Development President and Chief Executive Steven Van Amburgh, who took control of the company after Koll stepped down last year. Koll, who founded the company about 40 years ago, owns a small stake in Koll Development but is no longer involved in its management, Van Amburgh said.

The overhaul of the company’s California operation includes the closure of the company’s San Diego office by year-end and the eventual transfer of the remaining corporate staff in Newport Beach to Dallas, where Van Amburgh and other top officers are based. The Southern California operations will be consolidated in a newly constructed Koll office building in Irvine. The firm also will continue to operate a Northern California office in Danville.

Van Amburgh said the changes would result in layoffs that would reduce the number of California employees to 15 from 25.

Mike Parker, 38, a partner in the firm’s Northern California office, has been promoted to head the company’s Western division.

Although Koll has long been associated with commercial development in Orange County and California, about half of its development activity is outside the state.

The company’s smaller California operation now will be organized to help clients based in the state build or expand facilities wherever they are needed, Parker said. The company has not completely ruled out speculative development--which involves constructing buildings before they are leased--in California and elsewhere. But for now there is little demand for additional office or industrial space in most cities, he said.

“It will be a while before you will see us build an eight-story office building on spec,” Parker said.