Sidewalk Labs chief executive Dan Doctoroff announced in a blog post that the company is pulling out of Toronto, abandoning their controversial Quayside smart city project.

Doctoroff laid the decision squarely at the feet of the COVID-19 global pandemic.

“As unprecedented economic uncertainty has set in around the world and in the Toronto real estate market, it has become too difficult to make the 12-acre project financially viable without sacrificing core parts of the plan we had developed together with Waterfront Toronto to build a truly inclusive, sustainable community,” Doctoroff wrote. “And so, after a great deal of deliberation, we concluded that it no longer made sense to proceed with the Quayside project, and let Waterfront Toronto know yesterday.”

Sidewalk Labs came to Toronto in 2017, responding to a request for proposals by government agency Waterfront Toronto, looking for a project to revitalize a section of the city’s eastern lakeshore.

Sidewalk Labs is a subsidiary of Alphabet Inc, the parent company to Google. From the beginning the project was pitched as a smart city development which would use innovative approaches to rethinking the urban environment.

But Alphabet is now focused on cost-cutting, as the COVID-19 crisis has caused a collapse in advertising spending, which represents the main revenue stream for the company.

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