Artificial intelligence chip-making giant Nvidia is adding to its ambitious expansion ambitions in Silicon Valley with plans to tear down an aging warehouse next door to its massive Santa Clara headquarters and replace it with a larger, modern office building.
According to plans filed with the city, Nvidia wants to build a state-of-the-art office building totaling about 324,000 square feet at 2400 Condensa Street, an 11-acre light industrial property it owns just west of the company’s futuristic, twin-building campus at 2788 San Tomas Expressway. The development would also include a parking structure with about 3,000 spaces.
Nvidia plans to demolish the more than 50-year-old warehouse totaling around 215,000 square feet that it bought in 2007, according to records compiled by CoStar, with plans to develop the property as part of its headquarters, the bulk of which was completed back in 2017.
“To support our growth as we push the boundaries of accelerated computing, we have submitted a permit application to expand our headquarters with additional offices, lab space, and parking,” said Nvidia in a statement to CoStar News Thursday. “We hope to start work on this third phase of our longstanding development agreement with the city in the fall.”
While tech giants like Google and Meta have been slashing jobs and cutting back on office space, Nvidia is taking advantage of profits rolling in from the ongoing AI boom to expand at a breathtaking pace in recent months.
In recent months, Nvidia has been on a real estate expansion tear, paying $123 million in cash for a 10-building office and research park earlier this spring, and days later plunking down another $339 million for three office buildings it already occupied on San Tomas Expressway. With its market value swelling to $3.4 trillion thanks to the AI boom, Nvidia’s latest purchases mirror a real estate buying spree the company went on last year, when it dropped a nine-figure sum to acquire most of its Santa Clara headquarters from its soon-to-be former landlord, Preylock Holdings.
That means that Nvidia has spent about $836 million on real estate since last May.
San Francisco next?
Nvidia’s physical expansion has so far been concentrated in Silicon Valley, where the firm has been based since its inception in the early 1990s. It signed a lease late last year to take over the more than 100,000-square-foot property at 300 Holger Way in San Jose, Silicon Valley’s largest city, as it races to accommodate a surge in sales and hiring.
But on a podcast in early May, CEO Jensen Huang declared San Francisco recovered, thanks to the artificial intelligence industry, spurring speculation among real estate observers that the rapidly swelling giant might use some of its cash to stake out space in the city.
"Okay, anybody who lives in San Francisco, you'll know what I'm talking about. Just about everybody evacuated San Francisco," said Huang during the podcast. "Now it's thriving again. It's all because of AI."
Nvidia has said it plans to spend as much as $500 billion over the next four years building what it calls AI supercomputers entirely in the United States. It has commissioned more than a million square feet of manufacturing space to produce and test its products in factories operated by suppliers in Arizona and Texas.