New Digs: Microsoft Plans Multibillion-Dollar Headquarters Renovation
Urban campuses in the heart of bustling cities may be all the rage for tech companies these days, but Microsoft thinks it can create some of that modern city vibe without leaving its forested suburban campus.
The software giant is reiterating its commitment to its sprawling Redmond home with a massive multibillion-dollar campus renovation and expansion. The multiyear project is Microsoft's largest redevelopment to date, it said.
Over the next five to seven years, the company will construct 18 new buildings on the campus, which currently has 80. It will renovate several other buildings to give them a modern, open feel similar to the workplaces at Amazon, Google and other big tech companies.
Microsoft will replace 12 of its oldest one-office-per-person buildings and give a significant part of the campus a contemporary feel, allowing the company to expand the collaborative environment that it has been cultivating. Ten of the structures being replaced are the original X-shaped buildings that marked the early days of Microsoft in Redmond.
Microsoft will add about 2.5 million square feet in new construction and will renovate another 6.7 million square feet, primarily in the section of campus east of Highway 520, where many of the original buildings built in the mid-80s still stand.
The expansion will add about 1.3 million square feet to the 10 million-square-foot campus, after the 12 older buildings are torn down. When it's done, Microsoft will have room for 8,000 more employees to add to its 47,000-person head count in the Puget Sound region -- the vast majority of which work in Redmond.
"For us, it's not just about the ability to grow, but about the ability to take our campus into the future," Microsoft President Brad Smith said.
The company has already been renovating some buildings on campus to add open work spaces, gathering places and small conference rooms -- a feel that fits with the trend sweeping the tech industry. The days of an individual office for every employee seem to be ending as people gravitate toward communal spaces with high ceilings and colorful furniture.
Several of the new buildings will be four stories tall and centered on a new 2-acre plaza where events can be held -- giving the campus a bit of an urban vibe, Smith said. New sports fields and recreation trails will dot the area.
"With 500 acres, we can construct a somewhat more urban feel to parts of our campus, while still taking advantage of the nature," he said. That coexistence is underscored by the three new treehouses on Microsoft's campus -- actual wooden huts set high among the trees that the company uses for natural, but unheated, conference rooms.
Microsoft declined to put a price tag on its expansion and renovation plan, saying only that it would be a multibillion-dollar project.
The work will be done about the same time that the Redmond light-rail station opens, scheduled for 2023. Smith said that will give employees and new recruits the option of driving, taking the company's own Connector shuttle or zipping over the lake on the train, making it easier for those who want to live in Seattle and commute to Redmond.
Microsoft faces steep competition to recruit and keep employees as other tech giants continue to grow in the region and new, hip startups pop up every day. Salaries for software engineers are lucrative at pretty much every company, so businesses have turned to other perks to differentiate themselves.
Big Tech companies are one-upping each other on the most generous parental- leave policies, the best projects to run -- and the best locations and spaces to work.
Many companies are choosing urban sites largely because young employees often want to live in city centers where restaurants and public transportation are accessible.
Amazon is expanding in downtown Seattle, while also seeking a second North American location to build an equally huge HQ2. Expedia, long based in Bellevue, is planning a move to Seattle's waterfront in part because the online travel company believes it will help with recruiting.
But Microsoft isn't giving in to the urban push. It can create a city vibe, coupled with nature on its own campus, it says.
"(We have the) opportunity to really create a working environment that matches our new culture," Smith said.
That new culture, which emphasizes collaboration among teams, has been a rallying cry for the company since CEO Satya Nadella took over the reins in February 2014.
When Microsoft settled in to its headquarters in Redmond in 1986, its early buildings were built to emphasize personal working space and lots of windows. Pretty much every employee got their own office, a perk that helped Microsoft attract talent. But that setup also meant a lot of low ceilings and a lack of community spaces.
Microsoft started renovating office spaces nearly a decade ago and has already modernized several buildings in the open-format style.
The company embarked on its last major campus expansion in 2006, shortly after it signed a 20-year development agreement with the city of Redmond that allowed it to add an additional 2.2 million square feet of space. The coming expansion will just about tap out that extra room.
In return for its growing presence in the city, Microsoft committed in 2005 to give $150 million to the city of Redmond and Sound Transit for infrastructure improvements. Notably, that includes the construction of a pedestrian bridge over 520 that will allow employees to easily get from one side of campus to the other, and allow transit riders to cross from the light-rail station to the other side of the highway.
The company also secured a zoning change last year that allows it to construct some buildings on the east side of its campus up to 10 stories tall, but it said it has no plans for that height currently.
It's unclear if Microsoft will actually add 8,000 new employees to its Redmond campus or use the expansion, in part, to consolidate some of its Puget Sound area employees in about 45 other buildings.
Microsoft has leases on office space in Bellevue and Issaquah. It doesn't plan to make changes to those current agreements, Smith said, but when the leases end in seven years, "we'll see where we are."
Whether it keeps the leased space or consolidates, Microsoft plans to stay on the Eastside for a long time, a fact the city is grateful for.
"Microsoft has always been a great partner, and the city is excited that they will continue to call Redmond home," Mayor John Marchione said in a statement.
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