Tesla Uses California Cash to Take over Solyndra Building

Following Tesla Motors, Inc.’s (TSLA-NASDAQ) big award of California tax credits for promising to add 4500 jobs, the all-electric automaker just signed a lease to occupy the cavernous 500,000 square feet Solyndra plant at 901 Page Ave. in Fremont, California.

The building has been vacant for almost four years since the infamous company filed for bankruptcy after losing $849 million of taxpayer cash.

The move follows a day after reports that Governor Jerry Brown’s administration had awarded 30% of all the latest $50 million in “California Competes” tax credits to Tesla. The incentives are awarded to businesses that come or stay and grow in California, according to Governor Brown’s GO-Biz website.

Deputy Director Brook Taylor of the Governor’s Office of Business and Economic Development had told the Sanramento $15 million state tax credit would be in return for Tesla creating about 4,500 California jobs across its facilities in Fremont, Hawthorne, Lathrop and Newark.

The cavernous Solyndra building–which the commercial brokerage firm JLL marketed under the banner “Think Big” –is where Solyndra solar tubes once rolled off final assembly lines. But it’s been embarrassingly empty ever since the corrupt startup spectacularly imploded.

Christina Briggs, economic development manager for the city of Fremont told the Silicon Valley Business Journal: “The absorption of 901 Page would not only mean normalization of the city’s vacancy rates, but also reaffirms Fremont’s strength in the region for advanced manufacturing with all the former Solyndra facilities now transitioned to other Silicon Valley advanced industry heavyweights.”

The expansion represents Tesla’s largest commitment to Silicon Valley since buying the 380-acre former NUMMI site, which contains approximately 5.4 million square feet of industrial space, from bankrupt General Motors in 2010. Tesla also leased a 431,000-square-foot former Chrysler assembly plant in Lathrop last year, where it is doing computer-assisted machining. In May, Tesla added another 271,075-square-foot industrial building just behind that plant at 401-501 Nestle Way and snapped-up a 300,000-square-foot building under construction at 47400 Kato Road in Fremont, according to the Business Journal.

The former Solyndra plant is expected to allow Tesla to relocate some of the company’s engineering lab space now housed at the Palo Alto facility. Tesla could also shift its Service Center, which usually has about 30 vehicles in-house, from its factory.

The move will also free up space for the all-electric automaker to begin producing its Model S, the Model X, and its first mass-market vehicle, the Model 3. CEO Elon Musk announced at Tuesday’s annual shareholder meeting, held at the Computer History Museum in Mountain View, that Tesla will start deliveries of its Model X crossover by October. The company hopes to achieve substantial volumes with the $35,000 Model 3, which is targeted to begin deliveries in 2017.