From left: Lendlease CEO Steve McCann and Google CEO Sundar Pichai
UPDATED, July 17, 6:36 p.m. Eastern: Google has already found a partner for its most ambitious real estate project yet.
On Wednesday, Google announced that it has tapped Australia-based construction giant Lendlease to co-develop $15 billion worth of master-planned communities in Silicon Valley.
Under the terms of the agreement, Google and Lendlease will redevelop the tech company’s properties in Mountain View, Sunnyvale and San Jose, California, over the next 10 to 15 years. The firms will jointly undertake the master planning and development, which would see mixed-use communities replace office space and empty land. Lendlease is aiming to start work in 2021.
It’s part of a larger housing plan Google announced last month as an answer to the housing crisis it and other tech firms have created in Silicon Valley.
In an interview following the announcement, Lendlease’s CEO Americas Denis Hickey estimated the project will include 15,000 units of condominiums and rentals. The entire development work will see a total of 15 million square feet, not including office space.
Hickey said the Google-Lendlease team has already begun working with local governments on rezoning and master planning. The process, he said, is “well underway.” Lendlease said it was the largest deal in its 61-year history.
The search giant and the contractor are intimately familiar with one another —Lendlease in 2017 was selected to build Google’s $435 million London headquarters, which was designed by Bjarke Ingels and Heatherwick Studios and is expected to be completed in 2021. Lendlease also worked with Google on a discontinued headquarters in Sydney.
A few months ago, the tech giant poached Lendlease’s top real estate executive in San Francisco, Alexa Arena.
Lendlease is the go-to general contractor for luxury high-rise condo towers in New York City, having built Harry Macklowe and CIM Group’s 432 Park Avenue, World Wide Group and Rose Associates’ 252 East 57th Street, Vornado Realty Trust’s 220 Central Park South and Hines’ 53 West 53rd Street.
Back in 2015, the firm launched a development arm, its first New York project being 277 Fifth Avenue as part of a joint venture with the Victor Group.
The Sydney Morning Herald reported that the latest Google deal will increase Lendlease’s global development pipeline to about $70 billion.
Kathryn Brenzel contributed to this report.
Editor’s note: This version includes comments from Lendlease’s Denis Hickey.
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