Former Hynix complex in west Eugene to be offered at auction
Closed since 2008, the idle 1.2 million-square-foot Hynix semiconductor plant in west Eugene is up for auction again. (Chris Pietsch/The Register-Guard, 2008)
By Sherri Buri McDonald
The Register-Guard
11:34 a.m., Aug. 24, 2017
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The huge former Hynix computer-chip complex in west Eugene is up for auction — again.
The 1.2-million-square-foot complex is set to be sold to the highest bidder in an online auction, Sept. 25 to Sept. 27.
The auction will be held by Ten-X Commercial, an online commercial real estate marketplace.
The minimum bid is $10 million, with a deposit of $50,000 to participate, according to the auction listing.
The deposit applies to the purchase price for the winning bidder, and is refunded to losing bidders, the company said.
Ten-X also said it will charge a fee of 5 percent of the winning bid amount, which the buyer pays on top of the bid price.
Tech firm Broadcom Ltd. bought the former Hynix plant in 2015 with plans to convert it to make silicon chips for cell phones, but it abruptly changed direction and has listed the property for sale for about 10 months.
The auction may be an attempt to publicize the property and generate a sense of urgency among potential buyers.
The planned auction is stirring up old hopes in the community that the largest manufacturing campus in Lane County could be useful again — producing something, employing people and generating more property taxes.
“The hope is that a company rather than a broker will buy it,” said Ward Wimbish, director of Greater Eugene Inc., a nonprofit agency working to attract jobs-producing businesses to the area and help existing companies expand.
“It’s a very impressive piece of property,” Wimbish said. “The owners have done a great job in keeping all the permits current. They’ve maintained it. They have another 120 acres associated with it. There are a lot of positives. A company could come in and literally turn on the light switch and start work.”
Tech company Broadcom bought the shuttered plant in 2015.
Broadcom executives said the company would spend $400 million to retool the plant, hire about 230 people, with average annual pay and benefits of about $59,000, and start production in September 2019.
Amid debt and other market and financial pressures, Broadcom abruptly abandoned those plans in late 2016 and listed the property for sale.
Broadcom spokeswoman JP Clark said Thursday the company had no comment.
The property being auctioned off includes an 852,371-square-foot plant at 1830 Willow Creek Circle, with three floors above ground and two floors below ground, an adjacent 220,602-square-foot utility building and a 118,320-square foot, six-story office building at 4950 Pitchford Ave. The buildings are on 201 acres. The property includes a site ready for construction of a building with a 300,000-square-foot footprint, plus 120 acres for further expansion, the listing said.
An auction is a way for Broadcom to test the market and see if anyone is willing to pay for the plant and its surrounding property, said John Brown, a commercial real estate broker in Eugene.
The $10 million minimum bid allows Broadcom to put a “floor” on what it would be willing to accept, he said.
The company will have the right to accept or reject any bids, Brown said.
It’s no surprise that the property is difficult to sell, he said. The building is huge and would be expensive to divide for different uses, Brown said.
In comparison, Eugene developer Steve Lee was able to buy the former Monaco recreational vehicle manufacturing plant in Coburg and sell off parts of it to different industrial and office users, Brown said.
Even shuttered and empty, the former Hynix plant and its surrounding property have high carrying costs, including property taxes, stormwater charges, and the expense of maintaining a wetland, Brown said.
“It will be interesting to see how the market responds to the auction,” he said. “I hope somebody buys it and uses it to put people to work. It’s an incredible asset. It has not reached the end of its physical economic life.”
Avago Technologies, a Singapore-based semiconductor manufacturer, bought the former Hynix complex for $21 million in an auction in November 2015. Avago in February 2016 then bought rival semiconductor manufacturer Broadcom Corp. which is based in California. Avago then assumed Broadcom’s name.
South Korea-based conglomerate Hyundai built the massive plant and opened it in 1998. The company, which became Hynix, operated the facility for 10 years, before closing it in 2008 amid a glutted chip market and slowing world economy. The shutdown threw more than 1,000 people out of work.
The Hynix property sits in the West Eugene enterprise zone, which could make the buyer eligible for property tax waivers on upgrades it made.
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