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Google signs $146 million lease for new NASA campus

The deal, which was negotiated over the last year, builds on an agreement the search giant signed with NASA in September 2005 to collaborate on space and technology research.

NASA and Google said Wednesday that the search giant will build a new high-tech campus at the space agency's Ames Research Center in Mountain View, Calif.

As part of the 40-year agreement, Google will lease 42.2 acres of open field at NASA Ames close to its own headquarters in Mountain View for as much as $146 million over the life of the deal. By the end of 2013, Google said it will start construction on 1.2 million square feet of offices for research and development, in an effort to accommodate its growing staff of about 20,000. NASA Ames will oversee construction.

"This long-term lease agreement is a key component of Google's strategy for continued growth in Silicon Valley," David Radcliffe, Google's vice president of real estate and workplace services, said in a statement.

The agreement, which was negotiated over the last year, builds on other real estate dealings between NASA and Google. Google founders Larry Page and Sergey Brin pay NASA about $1.3 million annually to house and land four jets, including a Boeing 747, at Moffett Field, where they will build a new campus.

The lease also extends an agreement that Google signed with NASA in September 2005 to collaborate on space and technology research. Although NASA Ames hosts 55 other private companies with offices on its research campus, Google's lease will be the first to involve newly built facilities.

When finished, the campus will comprise about 2 percent of NASA Ames' 1,800 acres.

NASA Ames director Pete Worden said in a recent interview that Google's lease for the airplanes and related public-private partnerships are a win-win for NASA. The space agency, for example, has had use of the Google airplanes for research, he said. "We're defraying government costs. And it's not really a sweetheart deal. The use of the facility is pretty expensive," Worden said.

As part of the deal, Google will pay NASA an initial base rent of $3.66 million per year, based on appraisals of the fair market value of the land. That rent has room for adjustments over the life of the 40-year lease, and Google has rights to renew its lease for up to another 50 years.

Google plans to begin the first phase of its construction by the end of September 2013. (It's still in the process of working up designs, according to a Google representative.) It will start the second phase by 2018 and the third by 2022. The company did not specify the parameters of construction during each phase, but it said that the lion's share of space will be devoted to office space and research and development labs. The company also plans to build some company housing, along with facilities for dining, sports, fitness, childcare, and conferences.

NASA will use the proceeds from the deal to improve its own property at Ames, according to the space agency.

Worden also recently said that NASA is in discussions with a consortium of universities to build a campus at Ames. He said the group includes the University of California, Santa Clara University, Foothill College, and Carnegie Mellon University.

"The idea is to have a campus devoted to some of the specific expertise that's needed to power Silicon Valley. And this is an ideal location for it," Worden said.

CNET's Daniel Terdiman contributed to this report.

Updated at 12:10 p.m. PDT to include more detail and quotes.

A NASA representative said that the Google campus will be located on 4.2 acres on the northwestern side of Ames' 1,800-acre lot. Google Earth