SkyWater Technology Foundry inked a memorandum of understanding with Osceola County, Florida to take over a local manufacturing facility. The chipmaker wants to turn the 109,000 square foot complex, called the Center for Neovation, into an advanced packaging and technology center.
The electronic components company has 60 days to negotiate terms of a 20-year lease with Osceola officials.
Why Osceola County Wants SkyWater as a Tenant
For Osceola County, landing SkyWater as a new tenant would be a major step toward its long-term redevelopment plans.
In 2014, the University of Central Florida teamed with the Osceola city of Kissimmee to launch the sprawling complex. The two parties hoped to use the research facility as the anchor for a technology-focused district called NeoCity. Unfortunately, the University pulled out of the project in August citing financial concerns.
Accordingly, Osceola County has sought to find a new partner to occupy the site. Local officials believe a thriving NeoCity will bring over 100,000 new jobs and a slew of tech firms to the area. But at present, the site is only home to two tenants.
Getting SkyWater to open a new facility in the space could potentially get the project back on track.
Bringing the Bloomfield, Indiana company to the region would provide short-term benefits to the area even if a NeoCity revival does not occur. Osceola County leaders expect SkyWater to create 220 well-paying jobs to staff its packaging center.
Why SkyWater Has Interest in the Center for Neovation
SkyWater likely wants to manage the Center for Neovation because it would help the firm bolster its operations.
In 2017, the chipmaker spun off from Cypress Semiconductor intending to establish itself in the aerospace, automotive, industrial, medical, and consumer electronics industries. While it possesses a wealth of semiconductor manufacturing experience, it lacks a significant factory footprint. By leasing the Center of Neovation, the company would gain 60,000 square feet of cleanroom and manufacturing space.
SkyWater would need to spend an estimated $60 million to renovate the complex. It would also be required to operate the facility within the first five years of its rental agreement. That said, the site was made to host semiconductor manufacturing activities. For that reason, it would be much cheaper for the chipmaker to modernize the building rather than construct a new facility.
Once the renovation is complete, SkyWater could utilize its new lab and factory to expand its business.
For example, the firm received “Trust Foundry” certification from the U.S. government, which allows it to bid on lucrative U.S. Department of Defense chip contracts. With a larger production line, the company could accommodate larger public sector semiconductor projects.
Hopefully, Osceola County and SkyWater will be able to make a deal. From the outside looking in, the transaction looks like it would be a win-win for both parties.