Dive Brief:
- Google’s investments in San Jose, California, property has spurred a development boom that has seen plans for housing, retail and office projects explode, according to The Mercury News.
- In 2016, for instance, no new office developments were proposed for downtown San Jose, but 2017 saw 1 million square feet of planned office projects and 2018 saw another 4.3 million square feet that sought city planning approval. From September 2017 through September 2018, tech companies and investors, driven by rising property values and federal tax cuts, spent $1.4 billion on downtown real estate versus just $484 million from the prior year. Also in the works are retail and housing projects, which are being built in response to tech workers’ desire to live in an urban environment.
- Some observers credit Google’s plans for a “transit village,” which would help to support as many as 20,000 Google employees working in or near downtown within the next decade or so, for making property in the area so desirable. That project would include residential, retail, office space and open space, all accessible to the public. However, San Jose Mayor Sam Liccardo told The Mercury News that “decades of policies designed to build more transit, develop more high-density residential, more office buildings, more restaurants, and more amenities in downtown San Jose,” also helped lay the groundwork for the current boom.
Dive Insight:
San Jose is not the only place where Google is spurring additional construction. In December, the company unveiled its plans for a mixed-use “Complete Neighborhood” on property it owns in Mountain View, California, home to its existing headquarters. The company is asking the city to transfer its approval for 1.1 million square feet of office space on another parcel to that one. The end result would see the transformation of extraneous office space into as many as 6,600 new homes, 20% of which would be affordable for low-, moderate- and middle-income individuals and families. The company would also carve out more than 35 acres of accessible public space and build out space for retail, small business, community services and a new elementary school.
Also in December, Google announced a $1 billion investment into Google Hudson Square, its planned Manhattan campus, that will increase its New York City portfolio by 1.7 million square feet. The company will make improvements to three leased properties near the Hudson River. Two buildings will be ready for occupancy in 2020 and the other will be in 2022.
That announcement came on the heels of Google’s $2.4 billion purchase of Chelsea Market, a destination food and shopping venue that also has offices and a television production facility on the property.
