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Google eyes affordable homes project to launch downtown San Jose village

Housing development could mark start of Downtown West

Gathering areas in Downtown West, a mixed-use neighborhood of office buildings, homes, shops, restaurants and entertainment hubs near the Diridon train station in downtown San Jose, concept. 
(Google LLC)
(Google LLC)
Gathering areas in Downtown West, a mixed-use neighborhood of office buildings, homes, shops, restaurants and entertainment hubs near the Diridon train station in downtown San Jose, concept. (Google LLC)
George Avalos, business reporter, San Jose Mercury News, for his Wordpress profile. (Michael Malone/Bay Area News Group)

In a significant development that could help launch Google’s marquee project in West San Jose, the tech titan is eyeing an affordable-housing site — potentially laying the groundwork for a mixed-use community that would dramatically reshape a huge swath of downtown.

The highly anticipated project — known as Downtown West — would add office buildings, housing, shops, restaurants, parks, open spaces, entertainment hubs, cultural loops and hotel rooms to a mile-long area near the Diridon train station and SAP Center.

The affordable housing could sprout on a portion of the old Orchard Supply Hardware store. One of the buildings in that long-shuttered retail center was recently demolished.

Following this year’s demolition of the building at 720 West San Carlos Street, Google is evaluating its affordable housing development options at the site, according to Ryan Lamont, a Google spokesperson.

If a development proposal proceeds at the location, that would mark Google’s first distinct project in the Downtown West neighborhood on the western edges of downtown San Jose.

It’s a hopeful sign that Google is taking action on its development,” said Leah Toeniskoetter, president and chief executive officer of the San Jose Chamber of Commerce. “This is very positive.”

The precise timeline for the new neighborhood turned murky in February 2023 when Google disclosed that it was “reassessing” how best to move ahead with Downtown West, including the village’s launch date.

“Any development that puts residents and potential consumers in downtown San Jose is always welcome,” said Nick Goddard, a senior vice president with Colliers, a commercial real estate firm. “It would be nice to see this get going,” he added, referring to the Downtown West neighborhood.

Google is also evaluating any considerations related to the development agreement that it concluded with the city of San Jose, according to Lamont.

In 2021, the San Jose City Council approved a development agreement with Google that sketched out the general concepts for the new neighborhood, along with associated community developments.

No precise proposals for a specific site or sites within the Downtown West footprint have emerged.

The prospect that an affordable housing development might rise atop part of the old Orchard Supply site emerged after Jamestown LLC, Google’s development partner for Downtown West, requested meetings with four top San Jose city officials, all members of the city staff and not the mayor or City Council members.

Jamestown LLC requested meetings with San Jose’s planning director, economic development director, housing director and deputy city manager, according to information posted on a San Jose city site that details potential meetings that lobbyists have with key city officials, including politicians.

“Advancement of affordable site, potential development agreement amendment” was listed as the topic of the meeting.

If Google decides to proceed with — and gains approval for — an affordable housing development at the West San Carlos Street location, it would assuage some of the doubts about the future of the project that arose in the wake of the search giant’s decision to reevaluate the timeline for Downtown West.

Mountain View-based Google has revealed plans to eliminate about 2,500 jobs in the Bay Area as part of the tech company’s wide-ranging cost-cutting. This regional staffing reduction is part of Google layoffs worldwide.

Google is hardly the only tech company that has conducted layoffs in the Bay Area and nationwide. About 200 different tech companies have revealed plans to cut jobs in the Bay Area alone.

Tech titans such as Facebook app owner Meta Platforms, Tesla, Cisco Systems, Broadcom, Salesforce, Intel, Twitter, PayPal, LinkedIn, Amazon, Apple, Lyft, eBay and Lam Research also have filed WARN notices detailing Bay Area job cuts.

Even in the face of Google’s own layoffs, the search giant’s ongoing interest in downtown San Jose is in concert with the company’s stated strategy to cut jobs in some segments even as it seeks to ramp up hiring in promising arenas such as artificial intelligence.

While it’s unclear what kind of corporate footprint Google envisions over the next year or two, what is clear is that Google’s Downtown West neighborhood is poised to be a game-changer for San Jose.

“The area around Diridon Station and SAP Center has so much potential,” Toeniskoetter said.

The search giant expects to employ as many as 20,000 tech workers within the transit village’s footprint, once the office buildings are complete, a process that will likely occur in phases.

“Google has always said it would be a 10-year project,” Goddard said. “Google is publicly committed to this development, and their actions tend to confirm that.”