Seagate Shrinks Footprint at Fremont Campus it Sold, Leased Back

An Irish tech firm that sold its Silicon Valley research and development campus last year and leased it back for ten years is aiming to reduce its footprint at the 575K SF complex.

Dublin-based data storage company Seagate Technologies is offering for sublease 103K SF of the campus, located at 47488 Kato Road in Fremont. The sublease is being marketed by Cushman & Wakefield and Cresa, according to a report in the San Francisco Business Times.

Madison Capital and partner Sixth Street acquired the 30-acre campus for $260M in a deal that closed last May. The deal included an 11-acre parcel of undeveloped land behind the R&D building.

According to the report, Madison Capitol applied in September to the city of Fremont to subdivide the property. Earlier this month, Madison began offering the 11-acre parcel for lease, in a listing being marketed by JLL, for use as an industrial outdoor storage facility.

Seagate put the Fremont campus up for sale at the end of 2022, shortly after the company, which produces hard drives, announced plans to trim its global workforce by 8%. In an SEC filing in 2022, the company said the layoffs were driven by slowing demand for hard drives.

At the time, Seagate said the sale of the site would be paired with a long-term leaseback, adding “the site will continue to be a center for excellence for R&D, innovation and multiple business functions.” Seagate’s lease on the campus expires in May of 2033.

The Fremont campus, in proximity to Interstate 880, was built in 2010 for $300M as a Solyndra solar panel plant that received high-profile funding from the federal government as part of its recovery stimulus after the GFC.

A large part of government stimulus funding was aimed at renewable energy projects like Solyndra, but U.S. efforts to jump start domestic production of photovoltaic solar arrays were undercut by a flood of lower-cost solar panels that were manufactured in China, where they were subsidized.

After Solyndra filed for bankruptcy in 2011, Mitt Romney held a press conference at the plant site during his 2012 presidential campaign, citing it as an example of wasteful government spending.

Seagate acquired the Fremont campus in 2013 for $90.3M and invested $200M to renovate the property. The renovation, completed in 2016, included a combination of clean rooms, labs, office space and MEP infrastructure.

Seagate, which made the Fremont campus its operations headquarters, in 2019 sold a 140K SF office building it owned in Cupertino.