Google and other major tech firms have long been formidable commercial real estate players. After all, they own and build major office campus and lease millions of square feet of space around the country.
But it looks like Google parent company Alphabet is getting more directly involved in real estate development. A division of Alphabet, called Sidewalk Labs, is reportedly aiming to get into the “city building” business, according to The Wall Street Journal.
What Sidewalk eventually wants to do is develop new office, residential and retail space arenas within existing cities. These would apparently be technological hubs that would have features such as self-driving cars, and Sidewalk would target the blighted areas parts of major cities.
Sidewalk has just made big recent news with the announcement it is partnering with the U.S. Department of Transportation to streamline the country’s infrastructure. The idea is to use technology to fight traffic bottlenecks and delays in public transportation. More vague, but also interesting, is its idea of “connected cities,” which would have a stronger Internet infrastructure and give city planners better information on how to better build for the needs of their citizens.
One commentator points out that Google’s smart cities are far from altruistic for society. More affordable housing could mean lower wages for tech workers, and deals with cities to build such developments, would likely mean even more exposure and use of Google products.
Meanwhile, a lot is gearing up on the autonomous-car front. Google is reportedly searching for 400,000 square feet of space in order to have a production facility. Not to be outdone, Apple is looking for 800,000 square feet for a similar type of venture. The word is still out on self-driving vehicles, but who is going to bet against two of the largest companies in the world? Meanwhile, BMW, Ford, Mercedes and Toyota, are also reportedly looking for land in the Silicon Valley, on of the most expensive places to purchase lots in the country, so these tech companies are rubbing off on the traditional automobile industry, giving some proof that their aspirations might not be that far flung.
Of course, all of these developments are way in the future from becoming an everyday reality in our lives, but if they do come to fruition, they would have a major impact on commercial real estate.