San Francisco Mayor Willie Brown is expected to announce today
that Sega of America will move its 350-person corporate headquarters
from Redwood City to the city next year.
The troubled U.S. division of the Japanese video gamemaker is
expected to occupy around 160,000 square feet at the San Francisco
Fashion Center at 650 Townsend St. This is the latest step in the
transformation of the old South of Market retail warehouse into a
Mayor Brown and the San Francisco Partnership -- a nonprofit that
promotes business in the city -- also have lured Ziff-
Davis' high-tech TV division into the building, along with a number
of smaller high-tech tenants.
``Sega wanted to be in Multimedia Gulch to be part of the
innovation happening there and to be able to draw on the talent,''
said a source close to Sega.
Sega of America President Bernard Stolar lives in San Francisco.
The move comes after cost-cutting measures at Sega of America that
included laying off 30 percent of its workforce in January. Sega's
woes stem from its Saturn video-game machine lagging behind rivals
Nintendo 64 and Sony PlayStation.
However, the company plans to release a new machine next year that
it hopes will leapfrog the competition. For that reason, sources
said, the company is leasing extra space so that it has room to grow.
The San Francisco office will house the company's corporate
headquarters and sister firms SegaSoft Networks and Sega
Entertainment. It is slated to open in January 1999.