Zynga: From owner to renter

Nothing seems to be working out for Zynga. The mobile gaming company with one-time hits as Farmville and Words with Friends to its credit is today worth less than the office building in which it resides.

Shortly after it first went public, Zynga hit a market cap of $9 billion. But since then, it has been a road downhill for the company, with its public stock now valued at roughly $2 billion. With reserves of approximately $1.5 billion of cash on hand, analysts estimate that Zynga is actually worth around $500 million. In other words, Zynga’s headquarters is now significantly more valuable than Zynga the company.

The blog Halting Problem cited multiple sources saying that the building, which Zynga bought in 2012 for $228 million, is now worth around $540 million.

According to SFGate, "Zynga now faces the same kind of problem that many SF homeowners face: its house is worth more than the company." Perhaps that is why the company announced in February that it was putting its 668,000-square-foot, seven-story headquarters on 8th and Townsend for sale as it dealt with declining market share and layoffs.

Zynga rose to prominence with Facebook-linked games like Farmville and Words With Friends, but has struggled to replicate the successes of its earlier products. At the time of its 2011 IPO, Zynga’s shares were valued at $10 and the company boasted a workforce of 3,000 people. Now, their stock trades at $2 and rounds of layoffs have downsized their team to nearly 1,700 employees.