We already knew there would be delays for Apple’s 2.8-million square foot Campus 2 following reports in November. Apple originally planned to move around 12,000 employees into the currently under construction spaceship-like campus by 2015, but in November warned completion of construction would likely be delayed until mid-2016. Today we get some more insider info on the project in a report from Bloomberg Businessweek, claiming the project is now over budget and possibly delayed even further:
In a story titled “Apple’s Campus 2 shapes up as an investor relations nightmare,” citing sources close to the project, Bloomberg claimed Apple’s grandiose plans for the building have resulted in the budget nearly doubling to $5 billion:
Apple has yet to actually break ground on the site, but Bloomberg’s sources said Apple has plans to start demolition of 26 buildings that are currently on the land. According to the report, the delays are due to extra time spent attempting to cut around $1 billion from the budget. Apple has also yet to complete deals with contractors:
One reason for the new timetable, say three people who have spoken to Apple personnel about the project, is that the company has been working with lead architect Foster + Partners to cut $1 billion from the budget before proceeding. Jobs and Apple first hired Norman Foster’s firm, renowned for the rebuilt Reichstag in Berlin and Hearst Tower in New York, in 2010. Apple has named a general contractor—a joint venture of DPR Construction, in Redwood City, Calif., and prefabrication specialists Skanska USA Building in New York—but has not finalized agreements with the scores of subcontractors needed to complete the job. Some contractors will be submitting bids by May. There’s so much dirt to be removed, excavating the site will take six months and require a continuous, 24-hour convoy of trucks, says a former Apple manager who heard a presentation from Foster’s firm.
The report also gave a behind the scenes look at how Apple will construct Campus 2:
Bloomberg noted Apple could have a hard time making deals with contractors, as it is currently “offering a cost-plus contract that pays only half the percentage of profit of some large deals.” There are many more interesting bits about Apple’s upcoming Campus 2 in Bloomberg Businessweek’s full piece.
