Meta is joining a push from California officials to turn underutilized real estate in Sacramento into housing and education uses as the latest move from a tech giant to invest in communities near their Silicon Valley corporate hubs.
The Facebook and Instagram parent has committed $50 million to helping transform state office buildings into a mixed-use campus and housing for the California State University Sacramento.
Gov. Gavin Newsom announced that the state was partnering with the public university and the social media giant on the project, which he described as “a major boost to Sacramento’s economic future” that would include an artificial intelligence center, a new School of Public Affairs, a performing arts venue and a boutique hotel for students, faculty and staff at the public university.
"Meta is proud to call California home and we’re excited to work with Governor Newsom and Sacramento State to drive innovation in our state capital,” said Meta Chief Executive Mark Zuckerberg in a statement. He added that providing catalyst financing for the project would “help strengthen our communities and support the next generation of leaders and innovators.”
Tech giants such as Meta, Google and Apple have pledged billions of dollars to help combat California’s housing shortage and make the cost of housing more affordable near their corporate hubs. Meta’s pledge in 2019 to spend $1 billion to help build more affordable housing in its own hometown of Menlo Park has yielded little progress since 2022, though observers have acknowledged that California’s challenging development climate has contributed to hindering progress.
Big tech’s housing pledges followed years of tech-related job growth that helped push housing costs in the Bay Area to astronomical levels.
Sacramento revitalization
California's shortage of student housing is a corollary of the state's housing crisis that's become increasingly urgent in recent years, as college students desperate for roofs over their heads have taken up residence in sedans, trailers, cheap hotels and their parents’ homes. Rents near these major campuses have surged 30% since 2018, and over 400,000 students statewide are estimated to lack stable housing each year, according to the California Student Aid Commission.
"Sac State’s downtown project will not only provide students with affordable housing options, it will put them at the center of California civic life," said Kate Rodgers of the Student Homes Coalition, a Sacramento-based group that advocates for more student housing throughout the state, in an email to CoStar News.
The new campus would involve tearing down aging concrete buildings at 800 and 801 Capitol Mall that housed the Employment Development Dept. and the State Personnel Board, respectively, as well as the EDD Solar Building at 751 N St. in a prime area in downtown Sacramento that’s just blocks from the state Capitol building and walking distance to light-rail stations.
The redevelopment effort builds on an executive order issued by Newsom back in 2019 to revitalize and repurpose excess real estate owned by the state to create more affordable housing and other community development.
Officials have been pursuing the adaptive reuse of the buildings ever since. Last year, Sacramento State started making plans for a new downtown campus that would build badly needed affordable and market-rate university housing and a “School of American Democracy” that would bring “people, energy, and opportunity back to downtown Sacramento,” said Sacramento Mayor Kevin McCarty in a statement.
Barry Broome, CEO of the Greater Sacramento Economic Council, acknowledged that Meta's $50 million contribution was a fraction of the ultimate cost of the redevelopment project — and a nominal amount for a company valued at more than $1.8 trillion — but that its foundational role in the university project would "help create relationships for young people in the AI space" as well as bolstering the university's reputation.
Previous pledges
Downtown Sacramento is the region's business and financial center and home to some of the capital’s most prestigious properties and employers.
Nearly half of the office stock is owned and occupied by state agencies, but this has not insulated the submarket from the economic headwinds that have plagued many central business districts in the wake of the COVID-19 pandemic. Leasing volume in the second half of 2025 was below 100,000 square feet per quarter. Sutter Health’s signing of a lease for 113,000 square feet on J Street in early 2025 marked one of the only new downtown leases seen last year above 20,000 square feet.
Other backers of the downtown Sac State project, such as state Sen. Angelique Ashby, said that the project was likely to “benefit not only our students but also our long-term residents, sports teams, small businesses, and our identity as a region.”
This is not the first time officials have sought to revitalize a city’s downtown core by pushing an urban downtown university campus. In 2023, then San Francisco Mayor London Breed asked the University of California to consider opening a downtown campus that she argued would breathe new life into a downtown core plagued by empty office space and declining property values.