Quoted: on the rising cost of Apple’s new headquarters

“It would take some convincing for me to understand why $5 billion is the right number for a project like this. This is rubbing salt in the wound, to spend at a level that most anyone would say is extravagant, at a time when they’re being so stingy on dividends.”

Keith Goddard, CEO of Capital Advisors (which owns about 30,000 Apple shares), to Bloomberg Businessweek, which reports that the cost of Apple’s planned new headquarters in Cupertino has soared from less than $3 billion to nearly $5 billion. The company supposedly is trying to find $1 billion in savings, which could explain why CEO Tim Cook has said the move-in date will be delayed to 2016. The campus, a brainchild of the late Steve Jobs, is to be shaped like a spaceship, with “unprecedented 40-foot, floor-to-ceiling panes of concave glass from Germany,” among other stylish but expensive features. The grand plans were unveiled in June 2011 during a time of rapid growth for Apple, when it seemingly could do no wrong — and has, of course, inspired awe among Apple enthusiasts. But a lot has happened since Jobs brought the HQ plans before the Cupertino City Council just months before his death. The company’s shares were at around $332 in June 2011 and would go on to reach a record closing high of $700.10 in September 2012. But they have fallen back to Earth recently — they’re down about 38 percent from that record high — prompting grumbling (and legal action) from shareholders.

 

Image courtesy of the City of Cupertino

 

Tags: , , ,

 

Share this Post



 
 
 
  • sd

    Because I’m *sure* that the offices at Capital Advisors consist of a couple of kitchen chairs, some folding tables from the Goodwill, and a beat-up microwave with a dial in the break room.

    Here’s an idea, Mr. Goddard: if you don’t like the way a company spends money, DON’T BUY ITS STOCK. Trust me, if enough people don’t think Apple’s employees are worth a landmark office building, Apple will get the message soon enough. On the other hand, being Apple, they might just proceed anyway.

 
 
css.php