A Billion-Dollar Company Left California for Arizona and It’s Not the First
KB Home, one of the largest homebuilders in the United States and a Fortune 1000 company, announced on April 8, 2026, that it will move its corporate headquarters from Los Angeles to Tempe, Arizona, beginning in spring 2027. The company employs more than 2,100 people and carries a market capitalization of approximately $4 billion. In its official announcement, CEO Robert McGibney cited a more business-friendly operating environment in Arizona and said the move would lower the company’s cost structure over time. It is the latest in a growing list of major corporations that have exited California in recent years.
The Company Has Deep California Roots
KB Home was founded in Detroit in 1957 and has been headquartered in Los Angeles for decades, operating out of its Westwood offices. The move to Tempe’s Hayden Ferry Lakeside campus is actually a return to familiar ground: the company maintained a presence in the Phoenix area as far back as the early 1960s. Despite the headquarters relocation, KB Home will maintain six operating divisions across California and currently has more than 100 active communities statewide, spanning San Diego, Riverside, the Bay Area, and the Sacramento region. The corporate office is moving. The business footprint is staying.
California Operations Are Actually Expanding
One detail that complicates the straightforward departure narrative is that KB Home has been actively growing in California even as it prepares to move its headquarters. According to company spokesperson Craig LeMessurier, KB Home opened seven new communities in California in the six months leading up to the announcement and plans to open six more by the end of 2026. Recent openings include Veranda in Fremont, Point Martin in Daly City, and Platinum View in San Jose. Upcoming communities include Meadowbrook in Campbell, Promenade in San Jose, and Sorrell at Watson Ranch in American Canyon. This is a cost decision, not an exit from California housing.
The Numbers Show Where KB Home’s Business Already Is
The headquarters move reflects a shift in where KB Home actually builds homes, not just where it wants to cut costs. According to analysis by ResiClub, in 2012, KB Home built nearly four times as many homes in Los Angeles County as it did in Arizona’s Maricopa County. Today that ratio has flipped dramatically, with annual home closings in Maricopa County now nearly eight times higher than in Los Angeles County. The corporate move to the Phoenix metro area is, in that context, less of a departure and more of an alignment between where leadership sits and where the company’s growth is actually happening.
The Reason Given: Cost, Efficiency, and Business Environment
KB Home’s stated rationale centers on three factors: lower operating costs, a more business-friendly environment, and bringing executive leadership closer to its most active markets. Arizona offers significantly lower commercial real estate costs, a less burdensome regulatory structure, and proximity to the booming Southwest and Texas housing markets where KB Home operates across 49 markets nationally. Several of the company’s top executives were already working out of its Phoenix regional office before the announcement, making the headquarters transition a formalization of an arrangement already partially in place.
KB Home Is Joining a Long and Growing List
According to data compiled by Buildremote, 196 companies relocated their headquarters out of California between 2020 and the end of 2025. Texas was the top destination, drawing 54 percent of those moves, while companies spread across 30 different states overall. The departures include some of the most prominent names in American business: Tesla relocated to Austin in 2021, Oracle moved first to Texas and then to Nashville, Chevron announced a move to Houston in 2024, Charles Schwab left San Francisco for Texas in 2019, and Realtor.com relocated to Austin in 2025. John Paul Mitchell Systems and In-N-Out Burger also announced departures from California in 2025.
It Is Not Just Companies Leaving
The corporate exodus is happening alongside a parallel departure of residents. Nearly 700,000 people left California between 2022 and 2023, with affordability consistently cited as the primary driver. Los Angeles County alone saw tens of thousands of residents depart during that period. The combination of high housing costs, elevated state income taxes, and an overall cost of living that outpaces wages in many sectors has created conditions where both individuals and businesses are making the same calculation: the benefits of staying in California no longer outweigh the costs for their specific situation. KB Home operates at the intersection of both dynamics.
What This Means for California Workers
For KB Home’s California-based corporate employees, the headquarters relocation raises questions the company has not fully addressed publicly. A phased relocation of corporate staff to the new Tempe facility is expected throughout the first half of 2027. Not every employee will make that move. Some portion of the Westwood corporate workforce will likely not transition with the company, and what transition support or severance those employees receive has not been publicly disclosed. KB Home’s six California operating divisions will continue employing workers in construction, sales, and field management. The direct impact is concentrated at the headquarters level.
California Has Not Reversed the Conditions Driving the Trend
California’s overall economy remains the largest of any U.S. state, and supporters point to that scale as evidence the business environment remains viable. Critics counter that the scale of departures reflects a slow erosion that is difficult to fully reverse once it accelerates. A 2025 report by the Public Policy Institute of California found that 3 percent of all businesses relocated out of the state that year. That may sound modest, but the departures are disproportionately concentrated among larger corporations, which carry more economic weight in terms of jobs, tax revenue, and the anchor effect they have on surrounding businesses and vendors.
The Headquarters Is Moving. The Bigger Question Is What Follows.
KB Home’s relocation to Tempe in spring 2027 will not immediately change where its homes get built or who buys them. California will still have more than 100 active KB Home communities when the corporate offices are in Arizona. What the move represents is a decision by a company with nearly 70 years of history in the state that the administrative overhead of staying in California no longer justifies itself. That calculation, made by 196 companies over five years, is a data point California cannot dismiss with scale arguments alone. Whether the state addresses the conditions driving those decisions remains the more consequential and unresolved question behind this particular announcement.