While Oakland-based Pandora Media's shares nose-dived Thursday, the Internet radio company likely will be a long-term boon for the city despite near-term struggles for its stock.

One of the biggest proponents of Oakland is Pandora's chief executive officer, Joseph Kennedy. City officials say he frequently promotes the city as a destination for hip tech and social media companies.

"Joe Kennedy always says that Oakland is the only place his company could be because of its cultural vibe," Mayor Jean Quan said. "This is the place where he can find the kind of talent he needs to make his business possible.

"We are proud that Pandora grew up here."

Pandora suffered a 23 percent decline in its stock price Thursday, falling $4.07 to finish at $13.35. The setback shoved its shares below the initial public offering price of $16 and erased about $640 million in the company's market value in one day.

Pandora has attracted skeptics on the heels of its initial public offering. Some analysts question how quickly the company -- which has lost money since it was founded in 2000 -- can become profitable.

Still, the high-profile nature of Pandora, an online music company that seeks to revolutionize radio, is being touted as a company that also can help to transform downtown Oakland.

Pandora occupies about 32,000 square at 2101 Webster St., near 22nd Street, in Oakland's trendy Uptown district of restaurants, shops, nightclubs and homes.


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"They can absolutely transform downtown Oakland," said Walter Cohen, director of the city's Community and Economic Development Agency.

Much of that is driven by the kinds of employees that Pandora and other digital technology companies tend to hire.

"The young people they are bringing in, the highly technical people they have will bring about that transformation," Cohen said. "The notion that we are building a population base downtown makes us attractive to other technology companies."

Executives with Pandora say they are enthusiastic about being in the East Bay city, which is the third-largest in the Bay Area behind San Jose and San Francisco.

"The majority of our employees are in Oakland," said Deborah Roth, a vice president with Pandora. "We love Oakland."

The company also is in a hiring mode, Roth said. At the end of April, Pandora had 359 employees, according to a regulatory filing. This week, the company listed on its website openings to hire 45 employees, including 34 in Oakland.

"People look at Oakland as being a collection of nonprofits, lawyers and government agencies," said Edward Del Beccaro, a managing director with Grubb & Ellis, a commercial realty firm.

That image could morph into something much more cutting edge if Pandora manages to prosper.

"This is an entrepreneurial firm, a social media company, and that helps the downtown," Del Beccaro said. "With the new apartments and condos being built in the area, you can put the creative types in jobs in Oakland."

Other cutting-edge companies such as solar firms BrightSource Energy, Sungevity and SolarFirst have headquarters in Oakland. Tech firms such as iParadigms, Lucid Design Group, LiveScribe, Xantrion and Skytide also are based there.

City officials hope those ranks will swell steadily. And it may happen because Pandora is attempting to be an Oakland ambassador.

"Pandora has been active in trying to convince software and social media companies to move from San Francisco to Oakland," Quan said.

Contact George Avalos at 925-977-8477. Follow him at Twitter.com/george_avalos.