Google halts construction on 80-acre San Jose campus with no plans to restart in ‘near future’

Google is halting construction on its planned 80-acre campus in San Jose with no plans to restart it in the “near future”[ads1]; as it embarks on a series of layoffs and cost-cutting.

Dubbed Downtown West, the Google Village would have included shops, restaurants, a hotel and cultural and entertainment hubs, as well as potentially serving as the campus for 25,000 Google employees.

The company axed its campus development team — which it said would have a $19 billion financial impact — earlier this year in a series of downsizing moves as the economy worsens for big tech.

Rising interest rates and fears that the country is on the brink of recession have forced the cuts.

The plan was to break ground on the site before the end of 2023, but that was put on hold after concerns about delays at the start of the year, with no plans to start again.

San Jose Councilman Omar Torres, who represents the area, was concerned about the rumors.

“We all knew originally that it was going to be a long-term plan,” Torres said in February. “But yes, it’s definitely a concern that a lot of the money comes when the cranes are in the air.”

CNBC reports that sources are “optimistic” that the campus will eventually be built, it may have to be scaled back.

The LendLease project’s lead developer made 67 layoffs in February, including community engagement managers.

In a statement, a spokesperson for LendLease said it remains “committed to creating thriving mixed-use communities in the Bay Area, including the Google development,” and that it still has a “significant team to help deliver these communities .”

In March, Google pulled campus construction updates from its website.

Two months earlier, the company announced that 12,000 jobs, representing about 6 percent of its workforce, were being cut to deal with slowing sales growth after record headcount growth.

Google’s chief financial officer, Ruth Porat, wrote a rare company-wide email explaining how the tech giant is introducing measures to cut employee services in an effort to cut costs.

The company’s goal for 2023 is to ‘deliver lasting savings through improved speed and efficiency.’

Porat detailed how Google is cutting back on everything from training hours for its employees to basic office supplies from staplers and tape, while reducing the frequency of laptop replacements for its workers.

Google submitted its first application to the San Jose Planning Department on October 10, 2019.

“We embrace this vision not because it’s Google’s, but because it embraces the aspirations for a vibrant, dynamic downtown that our community has long held, as generations of San Joseans have sought to create a regional destination that reflects our authentic, diverse character,” San Jose Mayor Sam Liccardo said back in 2021, according to the Mercury News.

“Especially amid all the challenges of this pandemic, I am grateful for the continued collaboration between Google and city employees to enable our community to benefit from thousands of jobs, affordable apartments, vibrant shops and restaurants, public squares and park spaces .”

“We’re excited about this next step in our project, which incorporates feedback from thousands of people over the past two years and provides a new opportunity for community input,” Alexa Arena, Google’s director of development for San Jose, added at the time the plan was unveiled to almost two years ago.

The Downtown West area of ​​San Jose was set to cover 80 acres, 55 of which are developable. Of this, 30 acres were to be used for housing and public spaces.

As part of the plan, Google agreed to work with the city to ensure that 25 percent – ​​4,000 – of the homes in the Diridon Station area will be affordable.

“We continue to hear that housing and preserving affordability is a priority for San Jose, and our proposal offers more affordable housing, job pathways and community spaces for San Joseans,” Arena said.

The development was also asked to blend into the surrounding neighborhoods rather than function as a stand-alone technology campus.

“Downtown West is designed to be a true part of the city, the opposite of a traditional corporate campus,” said Laura Crescimano, founder of SITELAB urban studio, the project’s lead urban designer.

“The draft design standards and guidelines published today set the road map for a resilient and connected downtown in the west.”

And historic buildings and natural features in the area were also required to be incorporated into the plan.

“Our team worked with Google to draw on the uniqueness of the site to propose a place where urban life and nature can coexist,” Crescimano said.

“We have brought together new and historic buildings, opportunities for art and culture, playful spaces and moments of respite along the river.”

According to the draft environmental impact plan submitted in 2021, the project would not provide any net addition of greenhouse gases.

The company said the new buildings it is developing will be nearly 100 percent electric and 65 percent of trips will involve mass transit, cycling and walking.

The plan included the option for Downtown West to generate 7.8 megawatts of solar power on site, in addition to having its own local microgrid.

Google’s plan has been welcomed by city officials who say the “city-within-a-city” will benefit residents immensely.

“This is the next level of development for San Jose,” Scott Knies, executive director of the San Jose Downtown Association, said in early 2021.

“You have the housing, the affordable housing, and certainly the offices are there. But you also have the extraordinary combination of open spaces and cultural uses that make it truly unique.

“This is like a city within a city,” Knies added. “Downtown West will not be a forest of tall buildings. That’s bloody impressive.’

“At a time when so much of our world is on pause due to COVID, it’s encouraging to know that San Jose’s most significant long-term urban development project is on track and reaching an important milestone” with the filings, Assistant City Manager Kim Walesh said.

The project was not without its critics, however, as some locals fear it will displace working-class families and communities of color amid the pandemic.

“The pandemic has made the biggest community concerns surrounding this project — preventing displacement, adding affordable housing and securing quality jobs for working families and communities of color — even more critical,” said Maria Noel Fernandez, campaign director of Silicon Valley Rising, which is fighting the plan.