Google, SyWest can’t agree on Gateway site

Facing a dilemma, the Mountain View City Council found it impossible to choose between two competing visions for developing North Bayshore’s large gateway property. Rather than take a side, council members decided they may need to dictate their own development plans for the area.

At its Tuesday, Feb. 26, meeting, the City Council was asked to pick between two starkly different master plans submitted by Google and SyWest. The two companies each own roughly half of the 30-acre swath of land known as the Gateway site, located just north of Highway 101 and west of Shoreline Boulevard at the entrance to the North Bayshore tech corridor.

The backstory is complicated. In 2015, SyWest was originally planning to partner with LinkedIn to construct a 10-building campus that would mix corporate offices with entertainment such as restaurants and a movie theater. Impressed at the time, the City Council granted the partnership about two-thirds of the bonus development rights being allotted for North Bayshore.

It was a huge win for SyWest and LinkedIn, especially since they won the lion’s share of office development rights that Google was seeking. But Google managed to turn the situation to its advantage. In a 2016 land swap, Google traded several fully built offices on Mountain View’s east side in exchange for all of LinkedIn’s land holdings in North Bayshore.

Effectively, that trade eliminated LinkedIn and made Google the new partner of SyWest in developing the 30-acre Gateway property. Suffice it to say, it doesn’t appear to have worked out. Over the course of two years, the two companies failed to reach an agreement to work together. Late last year, both parties submitted their own conflicting development master plans for the area.

“Fundamentally, we’re just taking two different approaches,” said Bill Vierra, SyWest president. “We need 880,000 square feet of office space, and Google doesn’t want any offices on the site.”

The SyWest proposal calls for developing only its own 16-acre property, which is currently occupied by the Century Cinema theaters and its sprawling parking lot. That would be replaced with about 740 residential units as well as a hotel, shops and a new theater. The project would also create about 880,000 square feet of offices, leaving a smaller portion of office development rights for Google to use on its own development. But the plan left various details vague, such as how it would manage the immense traffic burden, and didn’t specify what community benefits it would offer.

In contrast, Google included the Gateway site as one cog in the wheel of its broader plans to create three new neighborhoods in North Bayshore, a “master framework” plan that the company has heavily promoted. In total, the company plans to build up to 7,000 housing units, as well as 1.18 million square feet of new offices — including 1,200 homes and 275,000 square feet of office space specifically for the Gateway site. City officials noted that Google was being presumptuous by planning to use SyWest’s land without any consent from the company.

Google real estate director Michael Tymoff said that his company was trying its best to comply with the city’s ambitious precise plan, including its hefty requirements for affordable housing and funding. He noted that the city’s demands for open space, retail and an elementary school made it so that his company could no longer aim for the 6,600 units the company originally envisioned. Now Google is looking to build somewhere in the area of 5,700 units, and any other units will need to be built by other developers, he said.

“Any further delay would make these issues that we’re trying to solve together much more acute and difficult to solve in a comprehensive way,” Tymoff said. “The last thing we’d want to do is reopen the precise plan and CEQA to delay this further.”

The two proposals spurred an ambivalent reaction from city staff, who noted that both fell short of the various requirements of the North Bayshore Precise Plan. Both parties were essentially feuding over who would get more development rights for office space, staff noted. As the issue came before the City Council, everyone lamented that the two companies couldn’t work out something on their own.

“What’s frustrating for me is there’s a clear win-win here: Google needs the office space, and there’s an ability for office here,” said Councilman Chris Clark. “Everyone could work together to marry all the elements, and I wish we could get to that point.”

To prod that process along, Councilwoman Margaret Abe-Koga suggested the city should step in and spell out how to develop the Gateway site. Basically, the city would draft its own master plan, similar to those submitted by SyWest and Google. Abe-Koga said she favored SyWest’s proposal, and she made a motion to use it as a starting point in any future master plan.

“I’d like to move forward in some way with SyWest’s concepts. The elements in their plan is close to what we envisioned,” she said. “I think we could be quite successful in this.”

Abe-Koga’s motion generated some pushback from city staff. City Manager Dan Rich pointed out that using SyWest’s proposal as the basis of a new overarching neighborhood plan would be essentially the same as approving its project. Plus, he noted that the city already had specific development goals in its own precise plan, which took nearly five years of work.

Upon hearing some concerns from other council members, Abe-Koga agreed not to specify any office allocation for SyWest. She also included a stipulation to urge SyWest and Google to enter mediation in a last-ditch effort to get them to settle their dispute on their own.

As the council meeting neared a vote, it became clear that a new Gateway master plan could be a complicated effort that may involve revisiting the larger precise plan. Abe-Koga suggested the city’s total allocation of office development might be infeasible. Mayor Lisa Matichak also recommended the city could consider shifting the building density specified in the precise plan.

Councilman Lucas Ramirez expressed doubt that the city would achieve better results by trying to force a compromise between Google and SyWest. He favored Google’s plan because it provided the most community benefits.

“Splitting the baby might not lead to the best outcome for anybody,” he said. “I’m not seeing an outcome where we can get the level of community benefit that Google is currently offering.”

The council voted to pursue a new master plan for the Gateway site 6-1, with Ramirez opposed.