VMware Beats Out Google For Prized Silicon Valley Office Space


Virtualization kingpin VMware scored a behind-the-scenes win this week with the inking of a $225 million lease that will add one million square feet of building space to its Palo Alto, Calif.-based headquarters.

The building space, situated in Stanford Research Park, was also coveted by Google and other unnamed suitors, and has been vacant since pharmaceutical company Roche left more than a year ago, the San Jose Mercury News reported Wednesday. VMware's lease runs through 2045, and its signing is expected to fuel an expansion that could see the virtualization vendor add up to 2,500 jobs, according to the report.

Stanford Research Park is home to a number of tech companies both young and old, including Facebook, Skype, HP and SAP, among others. VMware's lease will enable the company to expand its campus from 30 to 100 acres and five to 27 buildings, the San Jose Mercury News reported.

With a market capitalization of $41.2 billion, the future is looking bright for VMware. In the company's Q1 earnings last month, VMware's profit jumped 60 percent and revenue grew 33 percent.

But while these gains are largely tied to VMware's virtualization business, the company sees even greater opportunities in the cloud, and it's in the process of urging partners to follow its lead.

vSphere is still the dominant product, but VMware is taking steps to boost the profile of vShield, vCloud Director and vCenter Operations, both internally and externally. It's positioning the four products as a solution for any path companies might want to take to the cloud, and it's also providing incentives to salespeople to sell them as a cohesive group.

VMware is rallying developers with Cloud Foundry, a cloud platform-as-a-service that works with a variety of development frameworks and languages, application services and cloud deployment environments.

Cloud Foundry includes the Spring Framework, an enterprise Java programming model that VMware picked up in its August 2009 acquisition of SpringSource.