When news of Alaska Airlines' planned purchased of Virgin America first broke in April, fans of the Burlingame-based airline were despondent at the likely watering down of all the amenities that made Virgin so unique — actually decent customer service, mood lighting, on-demand music and TV, and in-seat concessions ordering. However we now learn via The Registry that with Alaska considering keeping the brands distinct for some time, the real changes won't come up in the sky but rather much closer to home. Specifically, not only will 225 Virgin employees based in Burlingame be laid off, but it is likely that the company will not renew the lease on its 85,000-square-foot headquarters.
That means a huge swath of commercial real estate just south of San Francisco could hit the market after the lease expires next year.
No official decision regarding the five-story building has been announced, and Virgin America spokeswoman Christie O’Toole suggests that the company is not going to completely ghost on the Bay Area. “While we’re still working to identify exactly what our specific real estate needs are beyond (the takeover closing as expected in the fourth quarter), there’s no question we will continue to have a corporate presence in the Bay Area,” she explained in a statement picked up by The Registry.
Although Alaska has yet to finish the acquisition of Virgin — it still awaits approval from the Department of Justice — the Business Times reports that JetBlue is already working to poach Virgin business customers. "JetBlue has a pile of cash and it's going to be a problem," Steve Danishek, president of a Seattle-based business travel agency, told the Times. "JetBlue has a better business class so they [Alaska] have to be ready."
Danishek envisions matching mileage offers and other deals to try to pull away customers who may worry that their status may be lost of diluted in the merger. No similar offer, it appears, is forthcoming for the 225 Virgin America employees who The Seattle Times warns should expect layoffs to start this month.