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How Google’s future campus could be a game-changer for Silicon Valley

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The tech giant’s future home near a growing transit hub seeks to revitalize downtown San Jose

Google’s current campus in Mountain View. The tech giant has plans to expand into downtown San Jose and build a massive corporate village near Diridon Station.
NurPhoto via Getty Images

Few building types have become as mythologized, meaningful, and, occasionally, mocked by the general public as corporate headquarters. Whether they’re anodyne rows of identical offices, glistening corporate campuses, or high-tech hubs for startups, the most famous become not just architecture, but narratives conveying corporate values.

That’s why many were disappointed to learn Apple’s new office in Cupertino, California, has more parking space than office space: It’s a disconnect from the company’s sleek, progressive (and curated) persona.

In Silicon Valley, it’s tempting to treat these physical representations of economic might as symbols of innovation and character (does the Amazon HQ2 race, pitting cities against each other, showcase the retail giant’s cold, calculating efficiency?). These headquarters are supposed to be glimpses of the future.

This hunger for something new explains why a collection of land and former industrial lots in downtown San Jose, just 10 miles east of Apple’s glittering new campus, has attracted so much attention. Google, the new owner, has plans for something transformative.

The tech giant’s desire to continue its aggressive expansion in the area and build a new corporate village adjacent to Diridon Station, a decades-old rail station, isn’t important because of cutting-edge design: groundbreaking for the project won’t happen for years, and there are no renderings of futuristic, spaceship-like structures. Nor is it necessarily about size, though it may end up stretching over 50 acres and being twice as large as Apple’s new HQ, accommodating 15,000 to 20,000 employees.

Rather, its location is what’s important: the developing urban core of the largest city in Silicon Valley, a region stuck in a mostly suburban mindset, adjacent to what will be the confluence of seven different rail and bus lines.

Google’s plans may turn Diridon Station—an expanding transit hub with a high-speed rail stop in the works—into the Grand Central of the west. The move could catalyze an even more urbanized San Jose, and signal that density transit-oriented development is part of the Valley’s future.

In a region with seemingly exponential jumps in real estate prices—home prices rose 11 percent last year—where engineers with six-figure salaries ride company buses to suburban offices every day, Google and Diridon represent a big shift (and an accelerant for the affordability crisis).

“This is a chance to do something world-class,” says Benjamin Grant, a Bay Area urban planner and designer with SPUR, a regional civic planning nonprofit. “We need to think Hamburg, Tokyo, and Copenhagen, not Palo Alto, Mountain View, or Sunnyvale.”

People play in a fountain outside of the Fairmont Hotel August 29, 2007, in downtown San Jose, California.
Justin Sullivan/Getty Images

Silicon Valley’s backward-looking take on urbanism

San Jose Mayor Sam Liccardo sees his city in the middle of a civic effort to recast itself as one built for people, not cars. While San Jose was one of the fastest-growing cities in the U.S.—in the automobile age of the ’50s, ’60s, and ’70s—its downtown was ignored, homes and offices went to the suburbs, and it developed like a donut.

“There are too many two-story campuses surrounded by a sea of parking,” Liccardo says. “It’s environmentally unsustainable and culturally deadening.”

Most office space in San Jose and the Valley is built on the assumption that the future is car-centric, says Allison Arieff, New York Times columnist and editorial director at the nonprofit San Francisco Bay Area Planning and Urban Research Association (SPUR). Consider Google’s facility in Mountain View, a collection of disparate structures and parking lots, remnants of an old way of thinking about workplace design, for an age when everyone went out to lunch. We have increasing amounts of data about the benefits of connected workspaces, those that bring workers together, and those linked to transit and walkable communities. Why not create something better?

“The default is, ‘Where are people going to park?’” says Arieff. “If you can get past that and embrace all this information—and Google, if anything, is about information—you can bring a whole new level of vitality to a city that should have it.”

Why hasn’t a similar urbanized campus appeared in a region that constantly complains about congestion and traffic problems? Grant says it’s part of the growing pains endemic in areas trying to make a suburban-to-urban transition. Residents can be timid about going vertical. Developers have trouble getting financing for unfamiliar developments. It’s assumed commuters want more parking. And in a community like San Jose that’s housing rich and job poor, the tendency is to be less restrictive on desperately needed commercial development.

The result—spread-out housing, bland office parks, low-rise offices, and crowded roadways—isn’t just an inconvenience. It’s shaping the Valley’s competitiveness and future prospects. A recent SPUR study, Rethinking the Corporate Campus, interviewed dozens of corporate leaders in Silicon Valley and found that housing and transportation are becoming significant employment issues.

The cost of living in the Valley impacts the cost of labor, leading many firms to bring only their most premium, important workers to the Bay Area and open branch offices in other cities to handle expansion and overflow (A $150,000-a-year engineer, for example, can buy a home in Nashville, or live with five roommates in San Jose). And getting those workers in the Bay to corporate campuses in Silicon Valley often means hour-plus trips on infamous tech shuttles, ferrying younger workers from the San Francisco neighborhoods they prefer.

“Car dependency hasn’t killed the golden goose yet, but the transportation system here is not functioning,” says Grant. “We should be thinking seriously about what that means for our growth engine, if that engine is predicated on a car-oriented urban pattern. There are only so many buses you can run on a congested freeway.”

Google’s proposed downtown San Jose campus, located near the city’s airport, may eventually lead to conflicts with the FAA, if the city and company seek upzoning to build taller, more dense buildings.
SOM, Courtesy of SPUR

Diridon’s potential

Google’s potential arrival at Diridon would attempt to address both the transportation and housing issues; additional rail connections to San Francisco and the region would reduce strain on already crowded streets and freeways, while the more dense, urban village expected to spring up around the campus would bring in thousands more housing units.

No Google representative was willing to go on the record to discuss the project. While the company is expanding in the Bay Area and elsewhere, and sees potential in a transit-friendly, walkable, urban campus, it’s still early days. Some of the final plots of land need to be purchased from the city and Santa Clara county, a proposed series of community engagement and dialogue sessions wouldn’t start until next year, and completion of Diridon’s rail upgrades is still years away.

The entire project is a unique and major construction challenge. High-speed rail and Bay Area Rapid Transit (BART) connections are under development and Google would likely ask for upzoning and the ability to construct taller buildings, observers predict (a request complicated by the flight paths of planes landing at nearby Mineta San Jose International Airport, meaning the FAA needs to get involved). A new home for Google likely won’t break ground until at least 2025.

But the size and scope of the project, and the complexities of transportation planning and funding, have created a hurry-up-and-wait situation, where adjacent real estate is already exploding in value due to the Google effect, and local leaders are moving ahead despite significant challenges to threading the needle on transportation and land-use issues.

Google’s rendering for Charleston East, a planned expansion of its Mountain View campus that aims to be more integrated into the surrounding area.

Mayor Liccardo jokingly views it as a Moses-like situation; he likely won’t be in office when the station and campus open, so he can only push everyone toward the promised land. Currently, rail is the big question mark. The city and county have already put in billions to fund various rail projects—the county just voted for another $1.5 billion for BART expansion in November—and California has chipped in hundreds of millions for Caltrain electrification. But the federal funding, a not-insignificant $1.5 billion, hasn’t come yet (Liccardo says the application process begins in March), and the lengthy environmental review for rail extensions also lies ahead.

While there are real obstacles, the city, and many investors, are already focused on what could be. Nanci Klein, ‎the city’s deputy director of economic development, believes Diridon can be transformative. With the Google campus coming, San Jose can build bigger and denser, eventually taking much of the city to a comfortable four to six stories and adding additional amenities and parks for an influx of downtown residents.

“I don’t think this is so far off,” says Robert Staedler, an urban planner and principal at the local firm Silicon Valley Synergy. “People say that to take the pressure off community expectations and stop speculation. It’s a clever ruse.”

Caltrain bike car at Diridon Railway Station in San Jose, California.
Moment Editorial/Getty Images

The downsides to having Google next door

Getting tech and government, not known to work at the same speeds, to collaborate on something this complicated certainly isn’t helped by public fears of the proposed project’s real estate ripple effect.

Jeffrey Buchanan, policy director at Working Partnerships USA, works with Silicon Valley Rising, a local coalition of community and labor organizations. The group, which is pushing for Diridon to be a model of responsible community development, has held a series of town halls across the city since the campus was announced earlier this summer, and found many community groups and residents fear rising rents and displacement.

“Residents across the city are concerned that there’s already an affordability crisis, and adding 20,000 tech workers downtown is only going to make it worse,” he says. “The fear is, San Jose can expect a San Francisco-style price boom when Google moves in. For working-class people who have seen their income after rent actually decrease over time, that’s a huge deal.”

Wages for most working-class families in San Jose haven’t kept up with fast-rising real estate prices. (Sources: Bureau of Labor Statistics, May 2016 Occupational Employment and Wage Estimates; realAnswers Third Quarter, Average Rents, 2016; City of San Jose, Housing Market Update Q3 2016; US Census Bureau, American Community Survey, 2011-2015 Five Year Estimates)
Silicon Valley Rising

San Jose, like the rest of the Valley, already has an affordability crisis. The cost of the average two-bedroom apartment is more than $3,000 a month higher than the median renter household income in San Jose. And, just six months in, some of the worst fears of gentrification in downtown San Jose seem to be coming true. Land near the edges of the Google campus, in neighborhoods such as Delmas Park, are already going for double their assessed values or more.

“Even if Google never steps foot into San Jose, we need to build 25,000 housing units,” says Mayor Liccardo. “We have a housing crisis.”

Buchanan already sees a future where an increasing number of the region’s service workers have to move farther away from job centers, to areas like Hollister or Los Banos, two or more hours away from work. It’s a domino effect: gentrification, affordability issues, displacement, and then additional traffic and transportation issues.

It doesn’t help perceptions that if all the proposed land sales go through, Google will own the choicest land near the valuable transit hub and rail lines—paid for with billions in public investments over decades—and likely request upzoning that will add millions to the value of the company’s initial investment.

Many just want to make sure San Jose is both demanding and supportive, and gets public value from the vast public investment in the land.

“This is a once-in-a-century opportunity,” says Grant. “We need to make sure we get an outcome worthy of the public’s investment in this place.”

Silicon Valley Rising would like to see a scenario where Google invests in its campus, as well as affordable housing in the region. A 2014 Diridon Station Area Plan suggested a combination of impact fees, development agreements, tax-increment financing, and the development of affordable housing on public land, among other tools, as a means to achieve affordable-housing goals.

It’s great that transit-oriented developments like Diridon get cars off the road, says Buchannan, but high-tech developments like this often lead to significant displacement.

“Can Google build all the housing that’s needed?” asks Arieff. “No, but I feel they could do something. We can’t ask them to do everything, but we can ask them to help with the intractable problems of housing and congestion. Companies are starting to understand that if they don’t help with these problems, they eventually won’t be able to hire anybody to work here anymore.”

Currently, Google is in talks with the city and county to purchase 16 remaining parcels of land (much of the proposed Diridon campus was part of a failed plan to bring a baseball stadium to San Jose). The focus will be on community meetings this year, and the status of any community development agreements that may come with future zoning agreements with Google.

San Jose, Silicon Valley view from downtown to the north and San Jose International Airport at sunset.

What’s at stake

Staedler says comparing Diridon to the “Grand Central of the West,” as some boosters have, misses the point. This really should be the Google Station of the West; let tech help San Jose with what cities don’t do well, and make them a true partner in building a new 21st-century model multimodal transportation center (as plans for Toronto from Sidewalks Labs show, they’re not averse to municipal partnerships).

The uniqueness of the Diridon rail investment, and the potential size of Google’s new campus, make this entire development a game-changer for the region. It’s a chance to reshape downtown San Jose, a unique opportunity to create a different kind of public and private partnership, as long as it’s done in a way that doesn’t lead to extreme disruption and displacement. It’s an opportunity for a region known for innovation to embrace urbanism that isn’t stuck in the 20th century.

“It won’t be a gated community of a corporate campus,” says Liccardo. “It’s about transit and urban design and the space between buildings. We have to get the paseos, parks, and plazas right. That’s how the city will be judged.”