Microsoft Stays Home, Plans Remodel to Urbanize Headquarters Campus

The Seattle area’s twin technology behemoths—Microsoft and Amazon—have pursued markedly different real estate strategies over the years, driven in part by the changing character of the region as they’ve grown.

That divergence was underscored Tuesday by Microsoft’s announcement of a major redevelopment and expansion of its headquarters campus in Redmond, about 16 miles east of Seattle. In contrast, Amazon said in September it was looking across North America for another city to host a second headquarters that would be a full equal to what it has built in the heart of Seattle.

Microsoft (NASDAQ: MSFT), in the mold of other corporate giants of its generation, has, over three decades, spread its headquarters across 500 hundred forested acres in the Seattle suburb of Redmond. Throughout its growth, the company has been committed to the region where its founders were born and bred.

Microsoft headquarters was from its early days, and well into the 21st century, a campus for software engineers driving their roadsters to parking lots surrounding buildings full of individual offices. A redesign and expansion a decade ago began to change that, with an emphasis on open floor plans and flexible, collaborative spaces, but the car was still king—as evidenced by a 5,000-spot underground parking garage that underpinned the company’s last big expansion, begun a decade ago.

Amazon (NASDAQ: AMZN), meanwhile, has built over the last decade a dense, a high-rise urban campus that has completely transformed Seattle’s South Lake Union neighborhood, and more recently, the northern edge of downtown. But as its ongoing search for a second headquarters highlights in no uncertain terms, the space-constrained Puget Sound region has few large undeveloped areas appropriate for an expansion that would accommodate up to 50,000 workers—the number Amazon said it may someday employ at its HQ2.

Microsoft’s local commitment, however, remains. The redevelopment and expansion announced Tuesday will add 2.2 million square feet and make room for up to 8,000 new employees when it is complete six to eight years from now. (Construction is expected to begin next fall.) Microsoft has some 47,000 employees in the region now.

“At a time when space is at a premium and many companies are looking for room to grow, we recognize that our 500-acre campus in Redmond, Washington, is a unique asset,” writes Brad Smith, Microsoft president and chief legal officer, in a blog post. “Neighboring a vibrant urban core, suburban towns, lakes, mountains, and miles of forest, it’s one of Microsoft’s crown jewels. And as we continue to grow and look to create the best workplace in the tech sector, Microsoft will invest right here in Redmond, our home for more than 30 years.”

The growth plan marks a continued shift away from the car-dependent campus of the last 30 years, made possible by the 2023 arrival of a light rail line that will make travelling to and from the campus without a car easier than ever. Already, 42 percent of Microsoft’s employees get to work by means other than a single-occupant vehicle—but that means something like 27,300 employees are gripping the wheel in the region’s worsening traffic each day.

“The campus will be built for pedestrians and bikes with all cars moved to an underground parking facility,” Smith notes.

Microsoft will tear down 12 existing buildings, including the iconic but outdated X-shaped low-rises that were the company’s original Redmond home. They were designed both to maximize the number of individual closed-door offices with windows—giving engineers of the day privacy and quiet in which to crunch code—and to be easily subdivided and leased to other tenants if the speculative software venture of the mid-1980s didn’t pan out. (Several of them surround a small pond dubbed “Lake Bill” in honor of co-founder Bill Gates. Video renderings of the campus renovation show the pond in the finished design.)

In their place, and in the acres around them, 18 new buildings will rise, with flexible floor plans meant to foster collaboration, inspiration, and accessibility. They will surround expanses of soccer and cricket fields, running trails, and a central plaza capable of hosting farmers’ markets, music performances, and up to 12,000 people for corporate events.

Tech companies, in an unending contest to attract the most talented employees they can, have long sought to out-do each other with perks, many of which center on workspaces that incorporate amenities for life and play.

Microsoft’s redeveloped central campus will be a car-free zone. A new pedestrian bridge will cross the highway that separates the east and west sides of Microsoft’s campus. It will all connect seamlessly with the Redmond Technology Transit Station, which will ferry passengers by light rail to downtown Bellevue and Seattle. Microsoft has agreed to provide $33.3 million in funding to Sound Transit for the station and pedestrian bridge.

That transportation emphasis is perhaps the biggest difference from the expansion plan a decade ago. At that time, Microsoft noted that the underground parking garage at the center of its West Campus would be among the largest in the country, with capacity for 5,000 cars.

While the redevelopment announced Tuesday will also feature underground parking and vehicle infrastructure, it will be built “with the automated vehicles of the near-future in mind,” according to another Microsoft blog post on the project. Elsewhere underground, the heat thrown off by cloud computing servers could be repurposed for food-growing programs.

“This is going to be an extremely intelligent campus, not because of devices but because of infrastructure,” says Bill Lee, Microsoft’s director of real estate, planning, and development, in the company’s post. “To have a campus that reflects innovation, we prioritize that urban environment. Walkability, nature, amenities—these all fold in to create community.”

Microsoft’s campus revamp is not the only effort to create an urban feel in the Seattle suburbs along the route of the new light rail line.

Three stops away, the Spring District is already taking shape, modeled on dense city neighborhoods such as South Lake Union and Portland, OR’s Pearl District. The anchor tenant of the Spring District, perhaps not coincidentally, is the Global Innovation Exchange, the Microsoft-backed graduate education program run by University of Washington and China’s Tsinghua University.

The developer of the Spring District, by the way, is Wright Runstad, which back in 1986 built the first six X-shaped buildings that will be replaced as part of this latest renovation.

Benjamin Romano is editor of Xconomy Seattle. Email him at bromano [at] xconomy.com. Follow @bromano

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