Nvidia drops $374M to become its own landlord in Santa Clara | Hacker News Reader

Nvidia drops $374M to become its own landlord in Santa Clara

sfstandard.com

18 pointsanigbrowl11 comments

$374m purchase cost / $2.3t market cap to own your property rounds pretty close to zero.

> Earlier this year, Preylock had quietly auctioned the properties for sale after receiving an unsolicited bid from a foreign buyer.

Really want to know who that bidder was. Was this just a market opportunity, a chance to charge a company hella money, or were there some sovereign interests in trying to take over the land? We won't know even if we do hear the would-be buyers, but espionage or manipulation seems hard to discard out of hand.

Last, a little editorializing: I struggle to imagine the cohones required to name my landlording company Preylock. Truth is stranger than fiction, part 2.3 trillion.

In terms of value investing and long-term outlook, NVIDIA is severely over-valued from temporary market demand driven mostly by just Microsoft and Meta dropping tens of billions over a few years. They will either build their own AI/GPU chips and/or realize they don't need as much computational power per year every year for any specific, monetizable apps. Either way, NVIDIA will quickly become irrelevant in the FAANG space and its stock price will crater.

I really want to make a social media site where if you post stuff like this you have to also post proof that you have taken a financial position aligned with it.

I worked at Meta and saw the CapEx outlays, and I own META stock. They're buying and building shit without having a specific product that will use it. It's "build it and they will come" "logic" rather than starting by building something people love and need and are willing to pay for or can make money from indirectly.

I had a co-worker who told me something similar with regards to Nvidia circa 2008, thankfully I didn’t listen to him ;)

Purchasing property generally marks the beginning of the end for a tech company.

Real estate is a lousy investment relative to anything tech.

That was $374M that Nvidia couldn't figure out how to put to use generating more revenue.

A lot of luxury brands bought out property of their flagship stores in 5th Avenue.

https://www.wsj.com/real-estate/commercial/luxury-retailers-...

They were getting tired of constant rent increases and figured it would also deny access to prime property from any emerging competitors in future. The ultimate goal of any business is survival and not pure profits.

They are a hardware company, but this isn’t their fab right? But does it have a lot of build out of labs, etc that would be hard to impossible to move with disruption?

They have a huge target on their back from competitors; imagine if a coerced party bought the land and then evicted them?

Eh I think that is more when companies start building grand palatial headquarters as a monument to the greatness of their vision. This doesn't seem like that.

The land in question is the location of NVIDIA's grand new palatial headquarters. I was surprised that they didn't own the land already.

> Between 2018 and 2022, Nvidia built and opened two nearby office buildings, totaling over 1.2 million square feet. Those buildings, named Voyager and Endeavor (the former a reference to Star Trek and the latter a NASA space shuttle), were developed and owned by Nvidia and were not part of this recent sale

Seems like it’s not the palatial HQ, but something else.

Reply on news.ycombinator.com