Google Pledges $1B To Help Ease Bay Area Housing Crisis
‘As we work to build a more helpful Google, we know our responsibility to help starts at home,” Google CEO Sundar Pichai says. ‘For us, that means being a good neighbor in the place where it all began over 20 years ago: the San Francisco Bay Area.’
Google is committing $1 billion to help ease a San Francisco Bay Area housing crisis that has squeezed out low- and middle-income residents and even some of the company’s own workers.
The expansions and high wages of Mountain View, Calif.-based Google and other Silicon Valley tech giants are blamed for a shortage of housing and price spikes in California’s Bay Area, where supply has not kept pace with demand for new homes and apartments, particularly affordable housing.
Google CEO Sundar Pichai today said the company’s $1 billion will support the development of as many as 20,000 new homes in the Bay Area, where the Mountain View-based Google is one of the largest employers.
“First, over the next 10 years, we’ll repurpose at least $750 million of Google’s land, most of which is currently zoned for office or commercial space, as residential housing,” Pichai said in a blog post. “This will enable us to support the development of at least 15,000 new homes at all income levels in the Bay Area, including housing options for middle- and low-income families. We hope this plays a role in addressing the chronic shortage of affordable housing options for long-time middle- and low-income residents.”
Google will establish a $250 million investment fund to provide developer incentives to build at least another 5,000 affordable housing units. It also pledged $50 million in Google.org grants to nonprofits focused on homelessness and displacement.
“The lack of new supply, combined with the rising cost of living, has resulted in a severe shortage of affordable housing options for long-time middle- and low-income residents,” Pichai said. “As Google grows throughout the Bay Area --whether it’s in our home town of Mountain View, in San Francisco or in our future developments in San Jose and Sunnyvale -- we’ve invested in developing housing that meets the needs of these communities. But there’s more to do.”
California Gov. Gavin Newsom tweeted his approval of Google’s announcement.
“Google recognizes that it has an important role to play in addressing California’s cost crisis,” Newsom tweeted. “I hope today’s announcement inspires other companies – big and small – to make similar direct investments in housing affordability throughout our state.”
Google in the coming months will continue to work with local municipalities to support plans that allow residential developers to build quickly and economically, according to Pichai.
“Our goal is to get housing construction started immediately, and for homes to be available in the next few years,” he said. “In Mountain View, we’ve already worked with the city to change zoning in the North Bayshore area to free up land for housing, and we’re currently in productive conversations with Sunnyvale and San Jose.”
Mountain View Mayor Lisa Matichak said she was pleased to see Google take an active role in addressing regional housing challenges, given its large Mountain View and Bay Area footprint.
“Mountain View has already cleared the way for robust residential development around Google headquarters, so we’re looking forward to seeing the details and what this announcement means for our city and other cities in the Bay Area,” Matichak told CRN. “I am particularly happy to see the quick infusion of $50 million to nonprofits working on homelessness and displacement. We hope other corporate neighbors will join in addressing these challenging issues in the very near future.”
While Matt Schwartz, CEO of the California Housing Partnership, also welcomed Google’s announcement, he urged it to “provide additional details showing exactly how the $250 million in investments will be used to produce housing affordable to the area’s lowest income households, who our reports have shown are most in need of assistance.”
“As an example, Microsoft’s January announcement included $250 million to purchase Low Income Housing Tax Credits, which is exactly the kind of tool needed to produce housing affordable to the Bay Area’s lowest income households,” said Schwartz, whose nonprofit helps preserve and expand the supply of homes affordable to low-income households in California.
Redmond, Wash.-based Microsoft in January pledged $500 million to help tackle the affordable housing crisis in Washington’s Puget Sound area. And NetApp, a hybrid cloud data services and data management company based in Sunnyvale, Calif., said it was investing $10 million in building and preserving low-cost housing in the Bay Area as part of the Housing Trust Silicon Valley’s TECH Fund.
In 2018 in Seattle, where Amazon has its headquarters, the City Council there voted to rescind a corporate “head tax” that would have charged a $275-per-employee tax on Seattle companies making more than $20 million per year to fund affordable housing -- less than a month after it approved the tax. The council’s about-face was prompted by Amazon opposition and a campaign for a ballot referendum to repeal the tax.