Nintendo to Redmond: Whoa on that expansion

Nintendo of America was so fired up about Redmond last year that it planned to expand its office space by about 550,000 square feet.

But now, the company might be scaling back those plans in favor of moving employees to other cities. Nintendo intends to relocate about 80 people in its sales, marketing and advertising teams to New York City or San Francisco, according to Jim Roberts, deputy planning director for the city of Redmond. Roberts said that Nintendo executive Bruce Meyer called him with the news.

Nintendo of America is the U.S. arm of the Japanese gaming giant, and had about 1,000 employees late last year.

Nintendo declined to comment on the transfers Tuesday.

The moves come as Nintendo is seeing unprecedented success this year with soaring sales of two gaming systems — the handheld DS player and the Wii console. Demand is so high for the systems that the company can't supply stores fast enough.

With the company fast-tracked for more growth, one question is clear: Is Nintendo getting too big for Redmond?

The company and city planners had been crafting a 10-year development agreement that addressed traffic impacts and environmental concerns. The expansion plans were ready to go before the Redmond City Council, said Roberts. Nintendo executives said they needed to get final approval from the company's headquarters in Japan, Roberts said, but then talks came to a halt.

"For one reason or another, it's been well over a year that we've been waiting for them to proceed," he said.

Now, real-estate brokers on the Eastside say Nintendo is rumored to be selling the very property it was eyeing for the expansion. Brokers said the property, at Northeast 51st Street and 148th Avenue Northeast, was up for sale as recently as several months ago, but they were unsure of its current status. Thomas Bohman, a broker with Cushman & Wakefield in Bellevue, said he recalls seeing a flier listing the land for sale late last year.

"They had a variety of different buyers looking at it," Bohman said. "I think they determined they didn't need the site and they had held it forever."

The property is adjacent to some Microsoft buildings, and one broker suggested that Microsoft was a possible buyer. Microsoft said Tuesday it would not comment on the matter.

Nintendo's real-estate agent, Al Hodge of the Broderick Group, said he would not comment, either.

Nintendo is "doing a bunch of stuff" right now, he said.

The company would not comment Tuesday on its Redmond plans, but Redmond Mayor Rosemarie Ives said that Nintendo assured her it would replace the lost positions here, but it was unclear what departments the new hires would fall under.

Ives said she wasn't worried about losing the company's corporate presence.

"We're just so proud to have Nintendo in Redmond," she said.

The Game Informer Online Web site said last week that Nintendo employees were told on May 3 about the relocation, and were given until June 1 to decide whether to move or accept a severance package. The new offices could be open as early as this fall, the site said.

Moving a sales or marketing group to New York might make sense, given the history of Nintendo of America President Reggie Fils-Aime. He spent years there as a marketing executive, most recently at the VH1 cable channel. Fils-Aime remained bicoastal after accepting a job with Nintendo, traveling to New York often.

There is no talk of Nintendo relocating Fils-Aime or some of its other Redmond-based teams, which include writers, translators, game testers, customer service and administration. Nintendo also has a production facility in North Bend.

Nintendo of America moved to Redmond in 1982, and has maintained a strong presence in the region. The company is the majority owner of the Seattle Mariners.

Seattle Times business reporter Amy Martinez contributed to this report.

Kim Peterson: 206-464-2360 or kpeterson@seattletimes.com