Seagate mulls selling Longmont plant, then leasing it back

LONGMONT — Data-storage manufacturer Seagate Technology Holdings (Nasdaq: STX) is exploring the idea of putting its 528,000-square-foot building in Longmont up for sale and then leasing it back from the buyer, according to a company statement.

“As part of our ongoing efforts to optimize our capital assets and opportunities for reinvestment, Seagate is exploring selling the Longmont site with a long-term lease back,” wrote Seagate spokesman Gregory Belloni in a prepared statement. “The site will continue to be a center of excellence for R&D, innovation and multiple business functions.”

Seagate is pursuing a similar lease-back strategy in the East Bay community of Fremont, California, where it has just listed its 575,000-square-foot product-development campus on 31 acres for sale for $300 million.

Built in 2010, the Fremont facility originally was a factory where Solyndra built solar arrays. Seagate bought it for $90.3 million in 2013, two years after Solyndra declared bankruptcy amid Great Recession pressures and a series of government investigations.

Commercial real-estate firm Cushman and Wakefield is handling the sale and lease-back transaction in Fremont. Calls to its Fort Collins and Denver offices to ascertain whether the company also would be handling the Longmont transaction were not returned before BizWest’s afternoon deadline.

The possible sale and lease-back plan comes in the wake of Seagate’s October announcement that it would cut 8% of its 40,000-person global workforce by early next year. It listed more than 1,500 people working in its Longmont facility as of 2016, but Belloni, during a Friday morning telephone call, would not reveal how many work there now, and a Longmont Area Chamber of Commerce estimate put the latest figure at “over 1,000.”

The company would not say whether or how the impending job cuts would impact the Longmont facility, but the statement hinted that Seagate wasn’t planning to leave Longmont.

“Seagate is highly committed to our employees, suppliers, and customers in the Front Range and across our global footprint,” it said.

Seagate, which was founded in Cupertino, California, as Shugart Technology, now is headquartered in Dublin, Ireland. The company developed the first 5.25-inch hard disk drive. Its major acquisitions include Control Data Corp.’s Imprimis division in 1989 and Connor Peripherals in 1996.

Seagate’s history also includes the acquisition of two companies with presences in Longmont.

In 2005, it purchased Milpitas, California-based Maxtor Corp., a rival disk-drive manufacturer that employed 870 people at a 475,000-square-foot building on a 25-acre site at 2452 Clover Basin Drive. That merger cost the jobs of 650 of those Maxtor employees. The building, which had been built in 1989, was closed in 2006 after the two companies consolidated operations, and sat vacant until last month, when the facility attracted Boise, Idaho-based Micron Technologies Inc. (Nasdaq: MU), which planned to fill 207,000 square feet of it. Denver-based Broe Real Estate Group, which bought the campus in 2018 for $8.6 million, planned to spend $100 million to renovate and update it.

In 2015, a month after Seagate laid off 70 workers in Longmont, about 5% of its local workforce at the time, it paid $696 million to buy storage technology company Dot Hill Systems Corp., which had been headquartered at 1351 S. Sunset St.

Source: BizWest

Related Articles