Apple Buys Former Chip Fab Next to Samsung in North San Jose

According to an exclusive report by Silicon Valley Business Journal, Apple has bought a former chip fabrication facility in North San Jose, paying $18.2 million for the 70,000 square foot building at 3725 North First Street. The building, which was a manufacturing facility for semiconductor company Maxim Integrated Products, is located next to Samsung Semiconductor which earlier this year opened a huge new campus at N. First St.

While it is not yet clear what Apple will use the facility for, the source notes that marketing material from the listing agent ATREG, says: “Well suited for prototype, pilot, and low-volume manufacturing, this facility is capable of producing a wide array of products at multiple technology nodes ranging from 600nm to 90nm, with the bulk of production from 350nm to 180nm”. Furthermore, the facility also offers a complete tool line consisting of 197 well-maintained front-end tools from such OEMs as AMAT, Hitachi, Novellus, LAM, TEL, KLA, and ASML.

“It’s pretty small for a fab,” said Dean Freeman, research VP at Gartner, where he leads the Internet of Things Center of Excellence. “The only thing I can think that they would be doing is potentially be saying, ‘OK, we need to do some prototyping in some way or form.’ Or they want a clean-room space to do some tweaky development. This isn’t big enough to do anything (production-wise).”

Analysts believe Apple may simply use the space for “heavy R&D” as it continues to expand into new products and markets.