Less than a month removed from the blockbuster announcement from Science Applications International Corp. that it would split into two companies, landlords, developers and brokers in Northern Virginia — where the company has a mammoth Tysons Corner campus and many satellite offices — are still sorting through what the implications might be for doing business with the contracting giant.
But with 15,000 local employees and $10.6 billion in revenue from the past fiscal year, the ramifications are likely to be major and could include sale of the company’s 23.7-acre Tysons Corner campus on the doorstep of the Greensboro Metro station along the coming Silver Line.
Executives from SAIC, ranked No. 245 on the 2012 Fortune 500, announced Aug. 30 that they planned to split the company into two units: a $4 billion-a-year business providing technical assistance, financial analysis and other services, and a $7 billion-a-year IT company.
Founded in 1969, SAIC moved from San Diego to McLean in 2009 and owns its corporate headquarters at its Tysons Corner campus on SAIC Drive. But K. Stuart Shea, chief operating officer, said that among the options the firm will consider as it splits in two over the next 15 months will be selling the main campus.
“We’ve always been in the model of monetizing our real estate holdings over the last couple of years. So as we go forward moving into two companies, we’re thinking through what do we need? Where should these two companies be headquartered?” Shea said.
SAIC, like many major Tysons landowners with holdings near the Silver Line, which is expected to start running late in 2013, has submitted an application for new development rights and could eventually build the campus to 4.9 million square feet according to Fairfax County officials. The proposal calls for three new office buildings, 1,900 new housing units, a 400-room hotel and more.
“We have talked about monetizing our McLean campus for years,” Shea added. “We have some active discussions today to look at it, but it’s something that has been well-advertised, well-discussed for a long time.”
Shea said SAIC is focused on the best way to create two competitive companies and that whether the campus is offered for sale, he could picture at least one of the companies remaining headquartered in the three office towers there. Although the services business is envisioned as more of price-focused operation that could benefit from less expensive real estate outside of Tysons, Shea said SAIC had developed a “proud and strong relationship with Virginia” and didn’t envision either of the companies relocating too far from the other.
Commercial real estate brokers in Northern Virginia said it was too early to tell what moves the company might make. SAIC maintains many offices in the area, some leased and some owned, in order to provide services closer to customers. That is unlikely to change dramatically when the companies split. SAIC already relies on Jones Lang LaSalle for management of about a quarter of its real estate.
The two companies will, however, need to sort out responsibility for existing leases and real estate assets, according to Meredith LaPier, a broker for CBRE in Tysons who specializes in managing real estate decisions for large companies. LaPier and others said it wasn’t clear yet whether SAIC would make major location changes.
“We can’t say whether their footprint is going to grow or decrease at this point,” she said. “I think it’s just really too early.”