SAN JOSE — Google will make an advanced community benefits payment to San Jose in the wake of a stalled development timeframe for the search giant’s mixed-use downtown neighborhood.
The tech titan has agreed to provide a $5 million advanced payment to the city for community benefits tied to Google’s proposed transit village near the Diridon train station in downtown San Jose, according to documents prepared for this week’s City Council meeting.
“Google remains dedicated to Silicon Valley,” San Jose Mayor Matt Mahan said. “You can see that commitment in their continued investment in our communities.”
The tech titan agreed to pay community benefits tied to San Jose’s approval of Google’s mixed-use neighborhood, Downtown West. The overall community benefits package totals $200 million.
In 2022, the search giant provided an advanced payment of $7.5 million in community benefits.
At the time the project was approved, city officials had anticipated Google would continue making payments as the office portions of the project were built in phases.
In 2023, however, Google revealed it had begun to “reassess” the timeline for Downtown West, a transit-oriented neighborhood near Diridon Station and SAP Center that would consist of office buildings, homes, shops and restaurants and could employ up to 25,000 people.
Mountain View-based Google’s decision to cut jobs and curb its appetite for office space also jolted the company’s plans for the downtown San Jose transit village.
“Most companies are now reevaluating their need for office space and restructuring office holdings or delaying development projects,” a city staff memo prepared for the council meeting states. “These same challenges have delayed the Downtown West project.”
Downtown West remains in a preliminary stage at present, the memo states.
The preliminary activity is slated to occur primarily at sites where Google’s development partner Jamestown plans to activate existing buildings with the Downtown West footprint. A precise timeframe for the launch of the interim activities wasn’t immediately available.
Also uncertain is when Google might launch the first homes, offices, or other buildings in the Downtown West transit village.
“No new construction has begun,” the city staff memo states. “At this time, there is no estimated timeline as to when the project may restart major development activities.”
In particular, the lack of office development directly impacts the anticipated pace of ongoing community benefits payments. The city established a fund commission to decide how to deploy the Google payments into the community.
“Without the development of office space, there is no identified way for the planned community benefits to be generated and allocated to the Fund Commission,” the staff memo stated.
Google worked with the fund commission and city staffers to provide an advance payment of $5 million. The city plans to deploy $200,000 during the current fiscal year which ends in June 2025. The fund commission will determine the pace to deploy the remaining $4.8 million.
” All funds will be expended by June 30, 2030,” the city staff report stated.