What is Google “Downtown West”
News publication CNBC reported that Google’s “Downtown West” will have 7.3 million square feet of office space. The 80 acre campus – which will also have 4,000 housing units, 50,000 square feet of retail and cultural space, and 15 acres of parks – is believed to have a construction cost of $19 billion.
Google won the approval to make this campus in June 2021 and reportedly offer 20,000 jobs after more than a decade of work. The construction project was supposed to break ground before the end of 2023 and the area has completed the first demolition phase, the report said.
However, the construction has been put on pause, CNBC cited people familiar with the matter as saying. The report also noted that Google hasn’t communicated any plan to restart construction to contractors.
According to The Mercury News, which is one of Silicon Valley’s main newspapers, Google did signal contractors late last year that the project could face delays and changes and that the company was reassessing its timeline. Google also removed construction updates from its website for the project.
There is an optimism that a campus will be built at some point and Google representatives have reportedly expressed a commitment to it. However, the project may not reach the scale promised in the original master plan.
Here’s what Google has to say
On Alphabet’s fourth-quarter earnings call, Ruth Porat, chief financial officer of Alphabet and its subsidiary Google, warned that other real estate charges were possible in the future.
“We’re working to ensure our real estate investments match the future needs of our hybrid workforce, our business and our communities,” CNBC cited a Google spokesperson as saying.
“While we’re assessing how to best move forward with Downtown West, we’re still committed to San Jose for the long term and believe in the importance of the development,” the spokesperson added.
In a statement to The Verge, Google spokesperson Bailey Tomson said, “As we’ve stated, we’re working to ensure our real estate investments match the future needs of our hybrid workforce, our business and our communities. While we’re assessing how to best move forward with Downtown West, we’re still committed to San José for the long term and believe in the importance of the development.”
Originally, Google said it would likely take between 10 and 30 years to build the campus. It means that the construction, which is halted, may resume post the economic conditions are better.