Epic Games buys North Carolina mall for a million-square-foot headquarters

• Epic Games has just purchased a failed mall outside Raleigh, North Carolina, for $ 95 million.
• The gaming giant plans to erect a million-square-meter headquarters that could be about 18 times the size of its current base outside Raleigh. The site can accommodate up to 4.5 million square feet of new space.
• Epic is at an impasse with Apple and Google over the installation of an in-game payment system in its highly successful game “Fortnite”, which allows users to circumvent fees charged by tech giants.
• The deal demonstrates not only Epic’s relentless ambitions following the process, but also how developers are creatively and profitably reusing mall properties that have collapsed due to a change of years in consumer buying habits and, in the last year, the pandemic.
• Visit the Business Insider home page for more stories.

Epic Games, a video game giant, bought an old mall outside Raleigh, North Carolina, for nearly $ 100 million, with plans to raise a million-square-foot headquarters there.

The company closed the package on December 31, according to a person with direct knowledge of the transaction. Epic announced the deal publicly on Sunday night after an investigation by Business Insider.

The purchase highlights the company’s ambitious growth plans, despite a major break with Silicon Valley. Over the summer, both Apple and Google removed Epic’s hit title “Fortnite” from their digital stores when Epic unveiled an in-game payment system that would allow customers to make purchases directly from Epic and avoid the fees normally charged by technology companies.

Immediately after, Epic filed a lawsuit against the two tech giants, challenging the expulsion of the game from its stores. The case is ongoing and has important implications for Epic’s business, as it could cut Epic’s standout game from billions of devices worldwide.

In announcing the project for the new headquarters, Epic seems adamant about the stalemate, with the company imagining dramatic growth for its operations.

Read More: The billionaire behind ‘Fortnite’ has repeatedly compared his company’s battle with Apple to the fight for civil rights, and said the fight is ‘an act of civil disobedience’.

The company purchased the 87-acre Cary Towne Center, a nearly 1 million square foot bankrupt mall that was acquired two years ago by developers Turnbridge Equities and Denali Properties of CBL Properties, a publicly owned mall owner who filed for bankruptcy in November. .

Jason Davis, Turnbridge’s managing director, said the company and Denali conducted the property through a month-long local rezoning process to allow up to 4.5 million square feet of mixed-use development on site.

Elka Looks, a spokeswoman for Epic, said the company had not yet drawn up detailed plans for the project. She declined to reveal whether she had hired an architect, how big the development would be or whether Epic would try to complete the project in phases to allow the company to grow in the additional space over time. The project has the potential to be much larger than Epic’s current headquarters, which is within walking distance in Cary, North Carolina, and totals about 250,000 square feet.

“We are still at the beginning of development and we have no plans to share yet,” said Looks by email. “The facilities will include office buildings and recreational spaces. We are committed to working with the city of Cary to explore ways in which some of these properties can be used by the community.”

Read More: ‘Fortnite’ maker Epic Games just set an antitrust trap for Apple, and Tim Cook got to the point.

Cary Mayor Harold Weinbrecht said in a statement that he was “extremely proud that Epic chose to call Cary home for its new global headquarters”.

“We look forward to continuing to work closely and in collaboration with the Epic team as they conceptualize their new campus,” said Weinbrecht.

Looks said Epic would start the project this year and anticipated relocating employees to the site in 2024.

The deal is an example of how struggling shopping mall properties that were affected by the pandemic and a shift in consumer spending for e-commerce for years are being profitably reinvented by developers. Davis said that just before Turnbridge and Denali bought the Cary Towne Center, one of their anchor tenants, JCPenney, closed their location on the property. Within months of buying the property, two more anchor tenants, Sears and Macy’s, gave up, Davis said. Turnbridge and Denali subsequently emptied much of the property’s remaining stores and would begin demolishing it next month, with plans to build a mix of offices, homes, shops and hotels in the vast site, Davis said.

Instead, Epic preemptively approached the group to buy the site for $ 95 million, Davis said, a considerable premium on the roughly $ 40 million that developers paid to buy the property and prepare it for development.

“I think Epic liked this site for the same reasons that we thought it was the perfect property to develop,” said Davis. “It is just minutes from downtown Raleigh, close to the airport and is one of the only critical land masses ready to be built in one of the fastest growing markets in the country.”