Google’s gigantic San Jose campus is suspended

Google has gobbled up bigger and bigger swaths of Silicon Valley since we reported on the company, but it may be pulling out of its biggest development yet – After razing small parts of San Jose to the ground.

CNBC reports that after the first phase of demolition, Google halted construction on its “Downtown West” campus, which was to turn 80 acres of downtown San Jose, California into 7.3 million square feet of office space, 4,000 homes, 50,000 square feet of retail and cultural space, and 15 acres of parkland. The city believed the project could be worth $19 billion and provide 20,000 jobs after more than a decade of construction.

Google does not deny the report, with spokesperson Bailey Tomson providing this statement to The edge:

As noted, we strive to ensure that our real estate investments align with the future needs of our hybrid workforce, our business and our communities. As we assess how best to move forward with Downtown West, we remain committed to San Jose for the long term and believe in the importance of development.

While that statement could mean anything from “we’ve had a little break” to “we’re not interested in doing this anymore,” Tomson also told us this San Jose Mercury News story that suggests Google is just changing the timeline, and where the quoted CEOs and development directors seem to hope it’s just a break.

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CNBC seems a little less optimistic, pointing out that Google is currently trying to reduce its office space rather than expand it, to the point that it will incur costs of half a billion dollars this quarter. The company cut 12,000 jobs in January. Google’s main contractor also appears to be out of work indefinitely: it has laid off more than 60 employees, with sources telling the publication they have not been told when construction may continue.

“Although sources are optimistic that a campus will be built at some point and that Google representatives are committed to it, they are concerned that the project will not reach the scale promised in the master plan of origin”, CNBC writing.

San Jose Mayor Matt Mahan downplayed the CNBC story to local reporters today, saying he had just received a call with Google to confirm that nothing had changed beyond the reassessment of the construction schedule, according to a video recording provided by his office to The edge. He didn’t say anything about how long the reassessment would last or when Google might resume, however.

“That, as far as we understand, is still their commitment”

“Google remains fully committed to San Jose for the long term, and San Jose is fully committed to Google,” Mahan said. “Google has a 30-year development agreement on its 80 acres around Diridon station, and they have a lot of flexibility built into that plan.” Later in the briefing, he added that the project was always designed to go faster or slower depending on Google’s hiring needs, and that the city of San Jose cannot dictate when a landlord builds new office space. .

“Over time, as the economy grows and Google grows again and they hire again, you’re going to see them move up to Downtown West I think, and like that, as far as we understand , is always their commitment”, he said.

San Jose Economic Development Director Nanci Kline confirmed the halt to construction for The Silicon Valley Business Journalbut said that among the layoffs at Google contractor Lendlease, only one person was cut from the Google Downtown West team.

The San Jose campus was controversial from the start and even sparked protests: Google spent four years convincing the city, making numerous concessions and presenting the entire campus as a new neighborhood, before the project be approved in 2021.

Update, 10:44 p.m. ET: Added comments from San Jose Mayor Matt Mahan and San Jose Business Development Manager Nanci Kline.

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