Google has concluded its arrangement with Lendlease, the main builder of four upcoming campus locales. The organization has been auditing its land speculations. As already reported by CNBC, Google has stopped some building work and made numerous Lendlease development workers related with the activities jobless. stock
This Thursday, Google announced the termination of its contract with its development partner that was in charge of four key campus sites. Lendlease, the developer, reported that Google had decided to end the agreements for the Downtown West project in San Jose, and the Moffett Park project in Sunnyvale. The remaining two sites, Middlefield Park and North Bayshore in Mountain View, which form the San Francisco Bay Project, were also subject to the termination. Both companies had worked together for the past 4 years.
Google stated that it is considering broadening its connections and working with both developers and capital partners to ensure that the campus developments move forward efficiently, and this could include the involvement of Lendlease. Alexa Arena, a Senior Director of Development at Google, said that the company is "optimizing its real estate investments in the Bay Area".
The Alphabet-owned company had previously implemented major cost cuts in late January, resulting in the termination of 12,000 jobs. Seeing its sales growth slow down, Google have continued making smaller cuts, along with reviewing its real estate investments, and found that the conditions no longer favored the partnership.
Initially, Lendlease and Google had collaborated on a $15 billion deal for 10-15 years, while Google also promised to build up to 15,000 housing units of which at least 25% would be affordable. Unfortunately, with market conditions and the downsizing of Google, the Downtown West project that had initially promised thousands of housing units, public parks, and other benefits, is now largely a demolition zone with an unsure future.
Despite this news, San Jose Mayor Matt Mahan clarified that the development timeline of the project and Google's commitment to San Jose remains the same. He mentioned that the project's aim of building 4,000 new homes in the city's downtown will still be underway. Google has also promised a community benefit package of up to $200 million which will be activated with the development of office space.
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