Google parent company Alphabet has paused plans to expand its office campus near Seattle, the latest sign of retrenchment for the technology industry as some of the world's biggest companies cut real estate as part of cost-saving measures.

Alphabet, based in Mountain View, California, delayed plans to develop a fourth building at its Kirkland Urban campus in Washington, and has left another 400,000 square feet of office space unfinished at two other buildings at the campus located east of Seattle, according to a report by commercial real estate brokerage Broderick Group.

The move comes as Google laid off thousands of employees, shed more than 2 million square feet of offices near its Silicon Valley headquarters and pulled back on expansion projects across the country as it redirects capital to high-priority initiatives such as artificial intelligence.

The pause adds to the pain in a commercial real estate market already suffering from decreased office demand linked to the remote-work boom. Other big companies such as Amazon, Microsoft and Facebook parent company Meta have cut costs by pulling back on property projects and offloading office space.

Google had planned four buildings at Kirkland Urban totaling 760,000 square feet of space, with the final building set to be completed in 2025.

The company debuted its first two buildings at an event that included Washington Gov. Jay Inslee and other elected leaders in April 2022, the same month that the company announced on its blog that it planned to invest another $9.5 billion to further stretch its vast commercial real estate footprint.

The company completed the south building last year but has now opted not to build out the space and paused plans for the fourth building, according to the Broderick Group report.

In an email to CoStar News, Google spokesperson Ryan Lamont said the company "remains committed to our long term presence in Kirkland.”

"As we've said before, we're working to ensure our real estate investments meet the current and future needs of our hybrid workforce,” Lamont said. "Our campuses are at the heart of our Google community."

Alphabet has opted not to finish the build out of about 400,000 square feet across the Kirkland Urban north and south building, according to the report.

Kirkland Urban North was built before Google acquired the site in 2019 and is leased by Salesforce-owned Tableau.

Salesforce announced last year that it planned to sublease the unfinished 120,000-square-foot Tableau space at Kirkland Urban North, but Google terminated the lease and has opted not to build out the space, according to the report. The company has also opted not to build out the interior space at the recently completed Kirkland Urban South building.

Google also pulled out of a deal in January 2023 to buy the Lee Johnson Chevrolet site in Kirkland, where it had planned more than 1 million square feet of office space as part of a massive mixed-use redevelopment project, according to a Kirkland city statement.

The search engine giant is by far Kirkland's largest office tenant, occupying more than a fifth of the relatively small submarket's 5.6 million square feet stock of office space, according to CoStar analytics.

Meanwhile, Google laid off hundreds of employees across multiple divisions in January as the company looks to curb expenses and shift its investment priorities with a focus on artificial intelligence.

The company — one of the largest office occupants in the San Francisco Bay Area — has put millions of square feet up for sublease over the past couple of years, walking back numerous real estate investments. The company was once considering more than $15 billion of real estate projects across the Bay Area, but those plans are in flux after it cut ties with its development partner Lendlease.

Other corporate tech heavyweights such as Amazon, Meta, Microsoft and Yahoo have also reduced their real estate footprints and laid off thousand of employees. Amazon told employees in January that it cut “several hundred” jobs across its streaming and theatrical film operations and has opted not to renew leases at several buildings near its Seattle headquarters.

Reductions in occupied space by large tech companies has contributed to major weakness in the country's office market, where total leasing volume by all office tenants is still down by about 15% compared to levels reported in 2019and the deals that are being signed are roughly 20% smaller, according to CoStar analysis.

That has helped drive the national vacancy rate to a record high of nearly 14%, a figure unlikely to drop anytime soon as tenants continue to offload more space than they're willing to take on.