In 2002, we wrote about how unused office space was draining the bottom lines of tech companies in the region.
The companies either had secured extra space to accommodate their growth, which never came, or laid off employees, creating a glut.
In that story, we reported that Onvia, an online government-contracting service, lost $5.2 million at its two Seattle buildings (about 100,000 square feet).
Today, the company seems to have finally rid itself of its excess space.
Onvia said it plans to move its headquarters to downtown Seattle in January 2008 from its office near South Lake Union. Simultaneously, Onvia also agreed with its landlord and a third party to terminate Onvia's obligations under its current office lease at no additional cost.
What's more, as a result of these transactions, Onvia's cash flow will improve by about $2.4 million and its operating expenses will decrease by about $700,000 over a 28 month period starting January 2008.
In July, Onvia provided a $538,000 security deposit on the new lease, and upon termination of its existing lease, Onvia's $3.5 million security deposit on its current space will be returned.
Executives are feeling good about the move.
"The net result of the two transactions will be to increase our future cash balance, cash flow and earnings," said Mike Pickett, Onvia's chairman and chief executive. "In addition, the new lease will provide Onvia with additional space to handle our future growth needs."