FanDuel spends $71M on Beverly Hills office
FanDuel, the largest online sports betting operator in the United States, recently opened a new $71 million office in Beverly Hills, California.
Still, online betting and sports betting are not allowed in the state, and it may take some time for that to change. FanDuel purchased a 50,200-square-foot, three-story building at 9000 Wilshire Blvd., paying $1,410 per square foot. By one estimate, that's more than four times the going price of commercial real estate in Southern California. That's likely a high price during a downturn in the region's office real estate market.
The Los Angeles office market is expected to remain soft due to a continued lack of leasing activity and rising vacancy rates. There are still some encouraging signs, including L.A. government agencies leasing large office space,” according to a study by Kidder Matthews.
It's unclear how many employees FanDuel will employ at the Beverly Hills facility.
Office bets don’t have to be foreplay
While hopes are high that California will eventually allow online sports betting, it could take several years, and online casinos may not launch there due to tribal control of the state's casino gambling industry.
That said, FanDuel's new location in Beverly Hills may not be a precursor to the operator betting on the state in the near future. In some cases, gambling companies have corporate offices in states where they do not book bets. DraftKings, for example, opened a new office in Las Vegas last year, although it does not offer daily fantasy sports (DFS) or sports betting in Nevada.
In the case of FanDuel, it makes sense for the new location to be in Beverly Hills, since the TVG cable channel is headquartered in Los Angeles.
According to its website, the gaming company currently has 15 open positions in Los Angeles, several of which are TVG-related, but none directly related to gaming.
FanDuel Sales a Success
The latest data from NAI Capital shows that office sales in Los Angeles County fell 42% in 2023, while the average price per square foot fell 41% to $295, indicating that FanDuel is indeed seeing high prices for Beverly Hills properties.
The deal could represent a huge payday for Swedish developer Skanska, which acquired the property in 2019 for $18.2 million. Skanska replaced two buildings there but will likely still be able to turn a healthy profit since FanDuel paid $71 million for the property.
FanDuel expects to become profitable in 2023, becoming the first U.S. sportsbook to achieve this feat. Parent company Flutter Entertainment (OTC: PDYPY ) is expected to list on the New York Stock Exchange (NYSE) later this month.
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Source: www.casino.org
