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SCOTTS VALLEY, CA-Fowler Property Acquisitions LLC has tied up the world headquarters of Aviza Technology Inc., a 43-acre site here known to the US Environmental Protection Agency as the “Watkins-Johnson Superfund Site.” Located 20 miles south of the Silicon Valley, which is where Aviza is planning to relocate, the Scotts Valley site holds 213,000 sf of built space in nine low-rise buildings that house the company’s headquarters, sales, customer service, operations, manufacturing, R&D and engineering units.

The would-be purchase price is $13 million. The agreement includes conditions for a 90-day due diligence period, during which time Fowler Property Acquisitions may evaluate the property for continued commercial use and, if it wants, back out of the deal. Aviza’s VP of IT and corporate services Dale Spencer tells GlobeSt.com that the agreement includes an option for Aviza to lease back the property for up to two years while it identifies its new headquarters. Yan Khamish of Fowler Property Acquisitions tells GlobeSt.com that he is in the early stages of its discovery process.

Known as FPA, Fowler Property Acquisitions is a privately capitalized real estate investment firm with dual headquarters in San Francisco and Newport Beach. Led by Gregory Fowler, FPA currently owns 130 properties in the Western US, including one property in Scotts Valley, a commercial property where the Santa Cruz Sentinel newspaper is located. The site previously was part of Borland Software Corp.’s facility in Scotts Valley.

Aviza is a public company that designs, manufactures, sells and supports systems used in segments of the semiconductor market, such as advanced silicon for memory devices, advanced 3-D packaging and power integrated circuits for communications. As of the start of 2008, affiliates of VantagePoint Venture Partners and Caisse de dépôt et placement du Québec owned a combined 50.1% of the company’s outstanding common stock.

The Aviza facility is located at 440 Kings Village Rd., which lies about one mile northwest of the Mt. Hermon Road exit from Highway 17. According to SEC filings, Aviza has a loan secured by the property, the maximum borrowings under which are limited to $13 million or 70% of the appraised value of the property, whichever is lower. Outstanding borrowings under the four-year commercial real estate term loan totaled $11.7 million at Dec. 28.

The property is currently subject to a Consent Order, dated as of July 16, 1991 entered into by Watkins-Johnson Co. (now WJ Communications Inc.), a prior owner of the Scotts Valley Site, and the EPA. The property is listed on the National Priorities List as the “Watkins-Johnson Superfund Site.” The contamination includes chlorinated solvents in soil and groundwater. The site is being remediated under the terms of an agreement under which an environmental consultant, Arcadis Geraghty & Miller International, has agreed to complete the work, and an insurance policy is in place to cover certain remediation costs.

Spencer says Aviza’s eventual relocation to Santa Clara County from Santa Cruz County is in response to the fact that most of its customers, suppliers, and existing and potential employees are really located in Santa Clara County. The company will need “quite a bit less” space than currently exists at its Scotts valley headquarters in part because the Scotts Valley facility is comprised of “a lot of older buildings not configured to what we need,” which he says is a combination of lab and office space as well as some manufacturing space.

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