The San Jose Mercury News is reporting that Apple has made a 98-acre land purchase in Cupertino to double the capacity of its original campus. The new location is the historic Hewlett-Packard campus, the same where Steve Wozniak was working when he and Steve Jobs were working on the first Apple computer in the 70s.

HP is in the middle of an operation to consolidate its headquarters in Palo Alto, and Apple apparently secured the old HP campus in an effort to expand Cupertino’s Infinite Loop. Put simply, Apple needs more room.

Cupertino officials, who had been disappointed by HP’s departure, said they were thrilled that Apple will now be the city’s biggest landowner.

“We’re very proud to have Apple’s headquarters in our city. It’s not just a company. It’s the company,” said Mayor Kris Wang, one of several officials who said they believe an expanded Apple operation could more than make up for the $1 million or so in annual tax revenue Cupertino now gets from HP and its employees.

HP denied to give details on the deal, but an Apple spokesperson confirmed the company bought the campus. It is believed the deal might have been closed at around $300 million, and maybe even less.

Whether the new location will house offices, labs or server rooms it’s unknown yet. I guess we’ll hear back during 2011.