Viking Still at Sea as Far as New Lease Goes
By ANDREW SIMONS
Viking Components Inc. has widened its search for a new home to Foothill Ranch and Rancho Santa Margarita, even as it still weighs details for a facility in Aliso Viejo, a company spokesman said.
“We’re looking at several different areas,” said Michael Nubel, Viking’s vice president of sales and marketing.
In November, Viking put its trendy Rancho Santa Margarita headquarters on the market and was closing in on a lease for a smaller facility in Aliso Viejo. The company’s current lease is up in March. Viking officials had been trying to rework terms for their current 150,000-square-foot facility, which includes test and assembly operations.
A maker of computer memory products, Viking isn’t using the top floor of its facility after laying off workers last year. Company officials have sought to cut a deal for less space and money at the Avenida de las Banderas site.
Viking originally moved from Aliso Viejo to Rancho Santa Margarita in 1997 to be close to nice neighborhoods, good schools and freeways, according to company officials. Many of Viking’s employees live in or near the area.
Nubel wouldn’t comment on specific building sizes Viking is considering in Foothill Ranch or Rancho Santa Margarita. The Aliso Viejo facility the company is considering is about 80,000 square feet,half the size of Viking’s current digs. Real estate brokerage CB Richard Ellis Services Inc. has an “available” sign outside Viking’s headquarters.
Viking’s story is the same as other memory companies. The company has grappled with slimming profits and a large inventory of memory boards, thanks to the downturn in the computers and networking gear.
Viking has tried to offset lower sales by cutting expenses. Company officials have said for several months they hope to pay less for their current real estate or find cheaper space elsewhere.
Viking’s fortunes could change soon. Prices for low-end dynamic random access memory modules have more than tripled to $3.47 a unit since the lows of mid-November.
Still, memory makers aren’t ready to declare a comeback. While memory prices are up, they’re nothing like what they were a year ago when a 128 megabyte chip went for $7.
The memory business follows a cycle marked by long periods of growth broken by contraction. Memory industry insiders hadn’t expected that business would return to a growth phase until summer. That could mean memory prices,while temporarily stable,still could go down again.
