Bungie Shrinks Footprint: Massive Studio Space Up for Sublease After Layoffs

Remember when Bungie was on a seemingly unstoppable trajectory, fueled by the success of Destiny 2? Well, things haven’t exactly gone according to plan. The PlayStation-owned studio, known for its sprawling headquarters in Bellevue, Washington, is now exploring subleasing significant portions of that very expensive real estate. This move comes after multiple rounds of layoffs impacting over 600 employees in just three years.

From Expansion to Contraction

Bungie doubled its office space back in 2021, a move that now seems less like strategic growth and more like a sign of overreach. The studio’s spokesperson told The Game Post that they are “exploring options to sublease” the campus. While Bungie maintains a physical presence in Bellevue, this shift reflects the team’s evolving workplace needs and the rise of remote collaboration.

The original expansion plans were ambitious, promising state-of-the-art facilities to support employee growth and development. The brochure advertising the sublease highlights impressive amenities, including a dedicated workout space, climbing wall, playtest areas, a motion capture studio, streaming studios, audio and Foley rooms, capture facilities, and editing suites.

At the time, Bungie’s press release said at the time that the new facility would support multiple project teams, including those beyond the Destiny universe. This expansion was intended to fuel both the continued success of Destiny 2 and the development of entirely new IPs.

The Sony Acquisition and Its Fallout

the following winter Sony acquired Bungie for a staggering $3.6 billion. However, that bet hasn’t exactly paid off. The ambitious plans to transform Destiny into a transmedia juggernaut never materialized. Many of the non-Destiny projects incubated at Bungie were canceled, with only one project (Gummy Bears, a “frog-like action” game) remaining within PlayStation.

The studio’s workforce has been significantly reduced. Bungie once employed over 1,500 people. Successive layoffs in 2023, 2024, and 2026 slashed that number by at least 600. It now appears Bungie is operating with a team closer to 500 employees.

While the “digital-first” approach allows for remote work and attracts talent, it also raises questions about the necessity of such a massive physical headquarters in the first place. It seems Bungie learned the hard way that even the most successful studios need to adapt to changing market conditions and evolving business models.