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,” Dan Doctoroff, the chief

executive of the corporate sibling, Sidewalk Labs, wrote in a blog post.

Sidewalk, and Mr. Doctoroff in particular, had vigorously pushed back against opposition to the plan since it was first unveiled nearly three years ago. But the struggle became a public-relations debacle for Alphabet Inc., the technology conglomerate that is the parent company of Sidewalk and Google.

What Sidewalk had presented as a community of unsurpassed environmental standards and a new approach to urban design was swiftly characterized as a dystopian surveillance city by many people in the technology world.