Nintendo starts work on new development expansion building

Nintendo has announced that plans to expand its game development capability are underway, part of which will include building a new office on the site of its old headquarters.

Nikkei reports that the company will be embarking on two major office expansions in an attempt to create more games in-house, rather than outsourcing some development.

In the first of these, Nintendo will be renting the 6th and 7th floors the Kyoto City Waterworks Bureau’s new government building from May 2022.

The new building is located right next to Nintendo’s current headquarters, and Nintendo will be using its rented space to house more development resources.

As part of Kyoto City’s Corporate Location Promotion System, Nintendo will be given up to 160 million yen ($1.4 million) every year for three years to cover some of its operation costs, depending on how many new employees it hires.

Perhaps more importantly, Nintendo will then be constructing an entirely new building on the site of its former headquarters.

The site is currently home to the Nintendo Kyoto Research Center and its Mario Club QA team, but contains a large area of empty land, where it’s assumed the new office will be built.

Nintendo said in a management briefing last month that the Switch’s unexpected level of success has enabled the company to invest in new business opportunities, including an $880m expansion of its game development capability.

During the briefing, Nintendo president Shuntaro Furukawa said it will spend up to ¥100 billion yen ($880 million) expanding its internal game development capability and up to ¥50 billion yen ($440 million) growing its non-game entertainment software assets such as movies.

“As a company that brings smiles through entertainment, Nintendo’s goal has always been to create original entertainment,” Furukawa said.

“In a business with extreme fluctuations like the entertainment business, the basic policy of our financial activities has been to secure cash and other liquid assets so we can continually offer products and services that constantly deliver new surprises.

“While this basic policy will not change, the Nintendo Switch business has exceeded our expectations, putting us in a strong cash position in these last few years and presenting a good opportunity to reconsider how to most effectively utilize our cash in a variety of strategic and meaningful ways.”