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Google’s construction site on future San Jose megacampus sits idle as company halts development amid cost-cutting.

Jennifer Elias

In June 2021, Google won approval to build an 80-acre campus, spanning 7.3 million square feet of office space, in San Jose, California, the third-largest city in the country’s most populous state. The estimated economic impact: $19 billion.

The timing couldn’t have been worse.

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A decade-long bull market in technology had just about run its course, and the following year would mark the worst for tech stocks since the 2008 financial crisis. Rising interest rates and recessionary concerns led advertisers to reel in spending, shrinking Google’s growth and, for the first time in the company’s history, forcing management to implement dramatic cost cuts.

The city of San Jose may now be paying the price. What was poised to be a mega-campus called “Downtown West,” with thousands of new housing units and 15 acres of public parks, is largely a demolition zone at risk of becoming a long-term eyesore and economic zero. CNBC has learned that, as part of Google’s downsizing that went into effect early this year, the company has gutted its development team for the San Jose campus.

The construction project, which was supposed to break ground before the end of 2023, has been put on pause, and no plan to restart construction has been communicated to contractors, according to people familiar with the matter who asked not to be named due to non-disclosure agreements. While sources are optimistic that a campus will be built at some point and said Google representatives have expressed a commitment to it, they’re concerned the project may not reach the scale promised in the original master plan.

The Mercury News, one of Silicon Valley’s main newspapers, previously reported that Google was reassessing its timeline. Sources told CNBC that the company started signaling to contractors late last year that the project could face delays and changes.

In February, LendLease, the lead developer for the project, laid off 67 employees, including several community engagement managers, according to filings viewed by CNBC. Senior development managers, a head of business operations and other executives were among those let go.

Last month, Google also removed construction updates from its website for the project, according to internal correspondence viewed by CNBC.

LendLease didn’t immediately respond to a request for comment.

Alphabet-owned Google is embarking on its most severe cost cuts in its almost two decades on the public market. The company said in January that it was eliminating 12,000 jobs, representing about 6% of its workforce, to reckon with slowing sales growth after headcount swelled before and during the Covid pandemic.

About a year ago, Google announced that it would invest nearly $10 billion in at least 20 key real estate projects in 2022. By then, the company had already completed much of its multi-year land grab of downtown San Jose for the future campus.

Money coming ‘when the cranes are in the air’

Things changed in a hurry. On Alphabet’s fourth-quarter earnings call in February, finance chief Ruth Porat said the company expected to incur costs of about $500 million in the first quarter to reduce global office space, and she warned that other real estate charges were possible in the future.

While the tech industry broadly is struggling to adapt to a post-Covid world that appears to be more hybrid in nature and less centered around large campuses, Google is in a particularly precarious spot because of its massive commitment, financial and otherwise, to altering the landscape of a major urban area.

“We’re working to ensure our real estate investments match the future needs of our hybrid workforce, our business and our communities,” a Google spokesperson said in an emailed statement. “While we’re assessing how to best move forward with Downtown West, we’re still committed to San Jose for the long term and believe in the importance of the development.”

Google spent several years planning for the San Jose complex and invested significant resources in winning over the local community. Opposition in some corners was so fierce that, in 2019, activists chained themselves to chairs inside San Jose’s City Hall over the decision to sell public land to Google. A multi-year effort to address community concerns ended with support from some of the project’s stiffest early opponents.

To win over the locals, Google designated more than half its campus to public use and offered up a $200 million community benefits package that included displacement funds, job placement training, and power for community leaders to influence how that money would be spent.

While some community benefits have already been delivered, the bulk is to be dispersed upon the office space development. Google also promised to build 15,000 residential units in Silicon Valley, with 25% of them considered “affordable,” a critical issue in an area with one of the highest homeless populations in the country, according to government statistics. Some 4,000 of those housing units were set to be built at Downtown West.

“We all originally knew that it’s going to be a long-term plan,” San Jose councilmember Omar Torres, who represents the downtown area, told San Jose Spotlight in February. “But yes, it’s definitely concerning that a lot of the money is coming when the cranes are in the air.”

Google’s construction site sits idle on a Tuesday afternoon.

Jennifer Elias

The demolition phase of the project took out a number of historic San Jose landmarks and forced the relocation of others. A 74-year-old dancing pig sign for Stephen’s Meat Products had to be moved, and only a small part of an old bakery building remains.

Patty’s Inn, an 88-year-old beloved pub, didn’t survive the teardown.

“This is a dive bar, but I never thought of it as a dive bar. It was just Patty’s Inn,” Jim Nielsen, an executive at RBC Wealth Management and longtime patron of the bar, told the Mercury News at the time. “It’s tough to see these places go away because they can’t be replaced.”

The new campus was expected to bring some 20,000 jobs to the city.

Empty swaths of land

CNBC visited the site a couple times in April during the normal workday, to see swaths of land where old buildings have been replaced by cranes, tractors and other construction equipment in a fenced-off area. Nobody was working on site.

Construction projects of this scale take a long time. Google had originally said it would likely need between 10 and 30 years to build out the campus, so it still has a significant cushion to resume development.

LendLease said in 2019 that it struck a $15 billion deal with Google to spend the next 10 to 15 years redeveloping the company’s landholdings in San Jose as well as nearby Sunnyvale and Mountain View, where Google is headquartered.

“LendLease will play a key role in helping deliver at least 15,000 new homes on our land,” David Radcliffe, Google’s real estate lead at the time, said in a press release.

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Microsoft engineer resigns over cloud business from Israeli military

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Microsoft engineer resigns over cloud business from Israeli military

Demonstrators hold a banner reading “Liberated Zone” during a protest at the Microsoft campus in Redmond, Washington, on Aug. 19, 2025. Microsoft Corp. employees rallied at the company’s Redmond, Washington, headquarters in an effort to ratchet up pressure on the software maker to stop doing business with Israel over its war in Gaza.

David Ryder | Bloomberg | Getty Images

A Microsoft engineer is resigning after 13 years at the software giant, claiming the company continues to sell cloud services to the Israeli military and that executives won’t discuss the war in Gaza.

Scott Sutfin-Glowski, a principal software engineer, informed colleagues at Microsoft on Thursday that this will be his last week at the company.

“I can no longer accept enabling what may be the worst atrocities of our time,” he wrote.

In the letter, he referred to a February Associated Press article that said the Israeli military had at least 635 Microsoft subscriptions, and he claimed the vast majority of them remain active.

Microsoft declined to comment.

Sutfin-Glowski’s announced departure comes a day after President Donald Trump said Israel and Hamas committed to the first phase of a peace plan two years into the latest conflict. The AP reported on Thursday, citing government officials, that the U.S. is sending roughly 200 troops to Israel to help support the ceasefire deal.

The conflict has been a matter of ongoing tension at Microsoft.

For months, employees have protested the company’s cloud business from the Israeli military. Five employees were fired.

In September, Microsoft said it had stopped providing certain services to a division of the Israeli Ministry of Defense, though it didn’t provide specifics. That decision came after Microsoft investigated an August report from The Guardian saying the Israeli Defense Forces’ Unit 8200 had built a system for tracking Palestinians’ phone calls.

Sutfin-Glowski said the company cut off communication systems that allowed employees to bring up their concerns regarding the Israeli military’s use of Microsoft products.

Outside a building at Microsoft headquarters in Redmond, Washington, on Thursday, employees and community members opened up banners calling on the company to drop ties with Israel, according to a statement from No Azure for Apartheid. The group has been asking Microsoft to listen to the more than 1,500 employees who petitioned the company to endorse a ceasefire.

“Today, the ceasefire in Gaza finally takes effect after two years of genocide, but the atrocities, human rights abuses, war crimes, apartheid, and occupation continue,” Sutfin-Glowski wrote.

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Tesla faces U.S. auto safety probe after reports FSD ran red lights, caused collisions

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Tesla faces U.S. auto safety probe after reports FSD ran red lights, caused collisions

The tablet of the new Tesla Model 3.

Matteo Della Torre | Nurphoto | Getty Images

Tesla is facing a federal investigation into possible safety defects with FSD, its partially automated driving system that is also known as Full Self-Driving (Supervised).

Media, vehicle owner and other incident reports to the National Highway Traffic Safety Administration showed that in 44 separate incidents, Tesla drivers using FSD said the system caused them to run a red light, steer into oncoming traffic or commit other traffic safety violations leading to collisions, including some that injured people.

In a notice posted to the agency’s website on Thursday, NHTSA said the investigation concerns “all Tesla vehicles that have been equipped with FSD (Supervised) or FSD (Beta),” which is an estimated 2,882,566 of the company’s electric cars.

Tesla cars, even with FSD engaged, require a human driver ready to brake or steer at any time.

The NHTSA Office of Defects Investigation opened a Preliminary Evaluation to “assess whether there was prior warning or adequate time for the driver to respond to the unexpected behavior” by Tesla’s FSD, or “to safely supervise the automated driving task,” among other things.

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The ODI’s review will also assess “warnings to the driver about the system’s impending behavior; the time given to drivers to respond; the capability of FSD to detect, display to the driver, and respond appropriately to traffic signals; and the capability of FSD to detect and respond to lane markings and wrong-way signage.”

Tesla did not respond to a request for comment on the new federal probe. The company released an updated version of FSD this week, version 14.1, to customers.

For years, Tesla CEO Elon Musk has promised investors that Tesla would someday be able to turn their existing electric vehicles into robotaxis, capable of generating income for owners while they sleep or go on vacation, with a simple software update.

That hasn’t happened yet, and Tesla has since informed owners that future upgrades will require new hardware as well as software releases.

Tesla is testing a Robotaxi-brand ride-hailing service in Texas and elsewhere, but it includes human safety drivers or valets on board who either conduct the drives or manually intervene as needed.

In February this year, Musk and President Donald Trump slashed NHTSA staff as part of a broader effort to reduce the federal workforce, impacting the agency’s ability to investigate vehicle safety and regulate autonomous vehicles, The Washington Post first reported.

Read NHTSA’s Tesla FSD traffic safety violations investigation filings here.

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Trump meets with Jared Isaacman about top NASA job after pulling nomination

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Trump meets with Jared Isaacman about top NASA job after pulling nomination

Commander Jared Isaacman of Polaris Dawn, a private human spaceflight mission, speaks at a press conference at the Kennedy Space Center in Cape Canaveral, Florida, U.S. August 19, 2024. 

Joe Skipper | Reuters

President Donald Trump has met with Jared Isaacman to discuss another nomination to lead NASA, a source familiar with the talks confirmed to CNBC’s Morgan Brennan.

Isaacman, who has close ties with SpaceX CEO Elon Musk, was at the White House in September for Trump’s dinner for tech power players. Musk did not attend.

Trump and Isaacman have had multiple in-person meetings in recent weeks to talk about the Shift4 founder’s vision for the space program, according to Bloomberg, citing a person familiar with the meetings.

After a fiery back-and-forth between Musk and Trump over government spending, the president pulled Isaacman’s nomination for the post, saying he was a “blue blooded Democrat, who had never contributed to a Republican before.”

“I also thought it inappropriate that a very close friend of Elon, who was in the Space Business, run NASA, when NASA is such a big part of Elon’s corporate life,” Trump wrote in a Truth Social post on June 6.

Trump named Transportation Secretary Sean Duffy interim head of NASA in July.

Isaacman, who declined to comment, was initially nominated in December to lead the space agency.

Isaacman is a seasoned space traveller, having led two private spaceflights with SpaceX in 2021 and 2024. Shift4 has invested $27.5 million in SpaceX, according to a 2021 filing.

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Isaacman stepped down as CEO from Shift4, the payments company he founded in 1999 at the age of 16, after his nomination was pulled, and now serves as executive chairman.

“Even knowing the outcome, I would do it all over again,” Isaacman wrote about the NASA nomination process in a letter to investors announcing the Shift4 change.

Now, it looks like he gets to do it all over again.

Tensions between Musk and Trump have cooled in the months since, but big challenges face the U.S. space program..

Trump has proposed cutting more than $6 billion from NASA’s budget.

As a result of Trump’s Department of Government Efficiency initiative, which Musk led in the first half of 2025, around 4,000 NASA employees took deferred resignation program offers, cutting the space agency’s staff of 18,000 by about one-fifth.

During the October government shutdown, NASA has made exceptions that allow employees to keep working on missions involving Musk’s SpaceX and Jeff Bezos’ Blue Origin.

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