When Microsoft makes a move, there are usually several factors at play, and yesterday's filing of a campus expansion plan with the city of Redmond was no exception. In the first disclosure...
When Microsoft makes a move, there are usually several factors at play, and yesterday’s filing of a campus expansion plan with the city of Redmond was no exception.
In the first disclosure of its kind since Microsoft moved to Redmond in 1986, the company gave the city a long-term growth plan that makes it easier to expand in Redmond, reassures local workers anxious about the company’s overseas expansion and gives a boost to the region’s business psyche.
The plan, submitted yesterday, projects 10,000 to 12,000 new jobs over the next 10 to 20 years. To accommodate the growth, Microsoft plans to build 2.8 million square feet of offices, plus parking garages and neighborhood road improvements.
Technically, it is asking for a development agreement, a sort of contract that would pre-approve much of the growth and commit Microsoft to infrastructure improvements. It’s expected to go before the Redmond City Council and a public hearing next month.
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“We wanted to show that we were doing our part to be good partners with both the city of Redmond and the local community,” Chris Owens, campus development manager, said Friday. “Completing a long-term master plan affords both Microsoft and the city of Redmond a blueprint for future growth.”
Microsoft officials also say the plan reaffirms the company’s long-term commitment to the region. City officials say there are numerous other advantages to the company’s approach.
One was the certainty Microsoft will receive about its ability to expand. If the City Council approves the agreement, the city’s red tape is transformed into a red carpet. Microsoft can also better estimate the costs of its growth.
“If it was my company, the one thing I want is certainty so I can plan on this and this and this,” said Councilman Richard Cole, a Boeing accountant. “I can’t determine the timing, but I can determine what it’s going to cost me.”
Microsoft may also glide past a big hurdle for commercial development in the Overlake area: a growth plan that limits how many offices can be built before road projects are completed.
By laying down its cards early, Microsoft is assured its campus growth won’t be blocked by the Overlake plan’s growth limits. The plan permits 15.4 million square feet more of commercial space in the city through 2012, said Rob Odle, Redmond comprehensive-planning manager.
“What it does is secure their ability to build within that ceiling,” Odle said.
Redmond is also particularly stringent about requiring traffic improvements to offset the effects of new construction. With the broad campus plan, Microsoft is negotiating all of the large improvements at once, instead of building by building.
It has suggested it give $30 million to infrastructure projects and pledged to support Redmond’s lobbying for more transit service and Highway 520 improvements, including a wider floating bridge over Lake Washington and more lanes between Microsoft and Union Hill Road in Redmond.
The most obvious project would be an overpass over Highway 520 at Northeast 36th Street. It would not include freeway ramps but would add another connection for the east and west areas of the campus. Microsoft pledged 70 percent of the cost, up to $15.2 million, provided the city finances the rest.
Other road projects that would be funded with the $30 million include an extension of 150th Avenue Northeast and a connection from Microsoft’s main campus to Bel-Red Road near Northeast 30th Street.
The company also proposed new turn lanes, signals or a combination of both at six intersections in the area.
Additionally, it’s asking the city to vacate any public streets within its campus if needed for its redevelopment.
It said it would build at least 8,450 new parking stalls.
Microsoft told city officials the plan is intended to reassure employees about the company’s commitment to the region, especially given anxiety about its increasing use of software-development talent in India.
This month, the company is opening the first building on a new campus in Hyderabad, India, that may eventually house 3,200 employees.
It’s also launching a new research lab in Bangalore, India, tomorrow.
The intended reassurance may be a relief to the many Microsoft employees waiting for their own offices.
A solo office is one of the company’s perks, but employees may still find themselves doubled up because hiring outpaces office construction.
The job growth outlined in the development agreement is roughly what economists were predicting, but the affirmation is welcome news as the state begins to emerge from the downturn, said Dick Conway, a Seattle economist who has done work for Microsoft.
“I think what’s happening at Microsoft is just one of a number of things that at least cause me to be optimistic about the future,” he said.
“We haven’t had a lot to hoot about recently; we’ve had a very severe recession, one of the worst in the nation.”
Brier Dudley: 206-515-5687 or email@example.com