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Summary:

The building will be green and energy efficient, but, Businessweek reports, it’s the “fit and finish” — the extra visual and structural flair — that Steve Jobs’ design calls for that are ballooning the price.

New Apple campus

Apple’s enormous, modern multibillion dollar new headquarters is running behind schedule and way over budget. Bloomberg Businessweek has the details in a story published Thursday about why the Steve Jobs’ dream campus may turn out to be the most expensive — and fussiest — office building in the world.

From gigantic pieces of curved glass produced in Europe and flown to Cupertino, to prefabbed supply closets and bathrooms trucked in, as well as 15 acres of trees to be planted and underground roads, the building looks to reflect Apple’s famous attention to detail. But what was supposed to cost $3 billion is now reportedly approaching $5 billion.

The building will be green and energy efficient, but, Businessweek reports, it’s the “fit and finish” — the extra visual and structural flair — that Jobs’ design calls for that are ballooning the price. Some of the budget-busting stuff stems from typical Jobsian perfectionism: one anecdote involves the decision to bypass the standard (but imperfect) construction method used for concrete ceilings; instead Apple will cast ceiling molds that will be lifted into place, “a far more expensive approach that left one person involved in the project speechless.”

The opening of the building has been delayed two years until 2016 because the company is said to be working to shave a billion off of the budget. But some investors still aren’t pleased; particularly with the idea of Apple spending on a new building when they could be funneling the money (where else?!) back to shareholders. Says one Apple stock owner quoted in the piece:

“It would take some convincing for me to understand why $5 billion is the right number for a project like this,” said Keith Goddard, the chief executive of Tulsa-based Capital Advisors, which owns 30,537 shares of Apple. “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.”

  1. Wow!!! This company has become a huge ship with no rudder heading straight for the iceberg! History will point to this moment in time when Apple finally lost it’s mojo for good! When the rest of the world is struggling to survive in a lack luster economy, Apple spends money like it’s going out of style and on itself no less!!! Time to sell my remaining shares of my Apple stock. Thank god I sold the majority of my shares around $700!!

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    1. melania harrod Thursday, April 4, 2013

      Cant wait to see this

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      1. Greg Robertson Thursday, April 4, 2013

        Must visit this place when it’s completed. Reminds me of the kind of attention to detail of days long past that have left the sorts of buildings that one is happy are still around – that communities are proud of for generations and settle around. It also sounds like the exact opposite of the majority of building projects today which are devoid of character, craftsmanship or vision. Would the Chrysler building be cheap to build? A Cathedral? This sounds like a structure which will leave the surrounding area with a real landmark and added personality. It will be a monument to a great American company and it’s visionary founder and from a time when it was on top of the world. I’m a shareholder and I stand firmly in the school of thought that this is good business and not a waste. Extravagance isn’t bad business and in particular with this brand that has produced so much profit that it sits in reserve. The bean counters at countless companies have ruined everything from products to job quality through cut backs, budget trimming and a too common failure to strive for something great as opposed to something cost effective.

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        1. tremendous comment!

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  2. As a shareholder, I’m thrilled that Apple will be creating a building of unparalleled vision and quality. It is this kind of vision and attention to detail that makes Apple products what they are. Apple is one of the few companies on the planet that could actually do this.

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  3. xavier Itzmann Thursday, April 4, 2013

    As investor, I have no quarrel with the cast ceiling molds.

    I think it is an utter waste of my money to make the building “green”.

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  4. In any other case I’d agree with “investor mentality” here, but not in this case. If this company can charge double premiums for its products’ good design, it should spend a fraction of these profits on something that will support its reputation of a premium company to work for and with for years to come. Plus, it will support the idea that Jobs’ legacy still lives on and support the company.

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