Alphabet Inc. (Google) is preparing to reduce more office space, this time in Washington, D.C., as the company continues redirecting investment toward artificial intelligence and data center infrastructure, according to CoStar.Â
The tech giant is expected to leave its roughly 100,000-square-foot office at 25 Massachusetts Avenue NW later this year. The space has housed legal, government affairs, and engineering teams for more than a decade.
Although the lease reportedly runs through 2030, the building’s ownership group has already begun marketing the upper floors for new tenants.
Google has not confirmed a final decision on the office, stating only that it continues evaluating its footprint across the region.
AI Spending Continues Climbing
The possible move comes during another major growth period for Alphabet’s AI business.
The company recently reported first-quarter revenue of roughly $110 billion, up 22% year over year, while net income climbed 81% to $62.6 billion.
At the same time, Alphabet plans to dramatically increase capital spending tied to AI systems, cloud infrastructure, and data center expansion. Company executives previously told analysts they expect capital expenditures to reach as much as $185 billion this year, nearly double 2025 levels.
Like Microsoft Corporation, Amazon.com, Inc., Meta Platforms, Inc., and OpenAI, Alphabet is investing heavily in the infrastructure needed to train and operate large AI systems.
Office Space Is No Longer Expanding At The Same Pace
While AI-related investment rises, large tech office footprints continue moving in the opposite direction.
Alphabet has spent years reducing parts of its office portfolio, including exits, consolidations, and subleasing efforts across major markets. Those moves have reportedly resulted in more than $1 billion in lease termination costs over time.
The company exited a roughly 300,000-square-foot waterfront office in San Francisco last year as part of its ongoing reductions.
At the same time, Google still maintains several large office locations across the Washington, D.C. region, including offices in nearby Reston.
What It Means For The Future Of Work
The latest consolidation highlights a growing divide inside corporate real estate strategy.
Many large employers still want physical offices, particularly for collaboration and high-value teams, but office growth is no longer matching the pace of investment flowing into AI systems and digital infrastructure.
For tech companies especially, data centers are increasingly becoming as strategically important as headquarters once were.
