NEWARK — DayStar Technologies Inc. , a solar energy company, has agreed to open a big manufacturing operation in the East Bay, an indication that the area could evolve into a fertile breeding ground for new energy firms.

The decision by DayStar also signals that the Newark-Fremont-Union City-Hayward area is becoming an attractive site for companies that want to escape increasingly costly buildings and land in Santa Clara and San Mateo counties.

In recent months, high-tech, life sciences and medical devices companies preceded the DayStar deal with deals to transplant or expand their operations.

DayStar agreed to rent 157,000 square feet in Pacific Research Center, a business park in Newark. The deal was arranged through commercial realty brokers from Staubach Co., GVA Kidder Matthews and Cushman & Wakefield. DayStar also has an option to expand by another 161,000 square feet in the building it will occupy.

Up to 150 employees are expected to work at the manufacturing complex when it opens. The precise timing for DayStar to open its new factory was not immediately known.

"The solar energy market has been growing at 40 percent a year," Stephan DeLuca, president and chief executive of DayStar, said in an interview with this newspaper. "It is continuing to grow very quickly."

The market is so strong, DeLuca said, that the primary limitations for the market right now are linked to supply and not demand.

"We are

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hoping to fill part of that demand," DeLuca said.

DayStar began its operations as a public company in 2003 in the Gold Country city of Grass Valley. In 2004, the company moved its headquarters and other facilities to New York state. But in 2007, DayStar moved its head offices and primary operations to Santa Clara.

It's possible the company could operate more than a manufacturing complex in Newark. DeLuca was asked if the headquarters might move to the East Bay as well.

"We have not made that final decision at this point," DeLuca said. "We have the capability at the project to expand." DayStar has about 80 workers at present. Its online site listed openings for another 15 workers.

"The Newark facility fit DayStar particularly well in that it allowed DayStar to keep its R&D close to the engineering talent and intellectual property," brokers with the Staubach Co. said in an e-mailed response to a question about the deal.

The complex also provides DayStar with "an advanced manufacturing facility in a project with great presence," the Staubach firm stated. DayStar's photovoltaic equipment evolved from thin films that are used to make semiconductors and can covert sunlight directly to electricity.

Besides DayStar, other big deals have landed at Pacific Research Center, a former campus for Sun Microsystems that has been resurrected by developer BioMed Realty Trust Inc.:

  • Risk Management Solutions disclosed in January it had agreed to rent 102,000 square feet in the same project. That nearly doubled the space the company had at a nearby site in Newark.

  • Revance Therapeutics Inc. in April decided to lease 90,000 square feet in the center. Revance is moving its operations from Mountain View.

    "We're being successful in attracting companies from the Peninsula and Silicon Valley," said Gregg Domanico, a broker with GVA Kidder Matthews.

    The DayStar, Revance and Risk Management deals mean that BioMed Realty has been able to find tenants for about one-third of the million square feet it expects to develop at Pacific Research Center, Domanico said.

    Other cities and projects also have found success in attracting high-tech and life sciences companies to this southwest sector of the East Bay.

    Ultra Clean Holdings inc. is moving about 325 workers, along with its headquarters, from Menlo Park to Hayward. NovaRay is moving from Palo Alto to Newark, adding 70 workers to the city. In 2007, Rackable Systems Inc. moved from Milpitas to Fremont.

    DayStar believes the Newark complex will enable it to recruit and retain employees with a broad array of talents.

    "We wanted to put our first factory in California so we could get it running as quickly as possible," DeLuca said. "We have our development engineers in Silicon Valley and we wanted the first factory to be close to them."

    George Avalos covers jobs, economic development, commercial real estate, finance and oil companies. Reach him at 925-977-8477 or gavalos@bayareanewsgroup.com