Google has been devouring Silicon Valley since we first reported on it, but now the company may be backing off from its largest development — following razing parts of San Jose.
Reports that after the first demolition phase Google has stopped construction on its “Downtown West” campus. The project was to transform 80 acres in downtown San Jose, California, into 7.3 millions square feet offices, 4,000 residential units, 50,000 sq ft of retail and culture space, and fifteen acres of parks. After more than a decade, the city thought that this project would be worth $19 billion. It was also expected to create 20,000 jobs.
Google hasn’t denied the report. A spokesperson, Bailey Tomson, provided this statement to The Verge:
Tomson pointed out that this San Jose Mercury News article suggests that Google may be changing its timeline. Quoted business leaders and developers seem to hope that it is just a pause. A 2020 image of Google’s proposed plan, showing its size.
It seems less optimistic, noting that Google has been trying to reduce office space, rather than increase it. This will cost the company half a billion in costs this quarter. In January, the company reduced 12,000 positions. Google’s main contractor is also out of work indefinitely: the company has laid off more than 60 employees. Sources told The Verge that they were not informed when construction would resume.
While sources are optimistic about a campus being built and say that Google representatives have committed to it, there’s concern the project might not reach the size promised in the initial master plan.
According to a video provided by his office, TheVerge, San Jose Mayor Matt Mahan played down the CNBC report to local journalists today. He said he had just finished a phone call with Google, to confirm that nothing had changed, other than reassessing construction timelines. He did not say how long it might take for the reassessment or when Google would resume.
As far as we can tell, their commitment is still the same.
Mahan said that Google is committed to San Jose for the long-term, while San Jose remains committed to Google. Google has a 30 year development agreement for its 80 acres surrounding Diridon Station. They have a lot of flexible built into this plan.
He said that as long as Google is growing and hiring again as well as the economy grows, they will move Downtown West forward. This, as far we know, is their commitment.
Nanci Kline, San Jose’s director of economic development, confirmed that construction had been halted to Silicon Valley Business Journal. She also said that only one Google Downtown West employee was laid off from Lendlease contractor.
Google’s San Jose campus has been controversial since its inception and has even sparked protests. Google spent four long years convincing the city by making concessions, and pitching it as a brand new neighborhood before and the project were approved in 2021.