Google to Buy NYC Headquarters
NEW YORK (
) -- Internet search powerhouse
(GOOG) - Get Report
looks to be bulking up its real estate portfolio as it expands its New York presence in what would be the largest single building purchase price in the U.S. in 2010.
Google is buying its New York City headquarters, the building at 111 8th Avenue, according to reports, and could pay around $1.8 billion for the property on the city's West Side.
The 18-story building comprises 2.9 million square feet and takes up an entire city block in the Chelsea neighborhood, just north of the West Village and west of Union Square.
Rumors of the sale first circulated earlier this fall. The deal is now likely to close by the end of the year,
Bloomberg
reported.
New York-based real estate research firm Real Capital Analytics told the news outlet it would be 2010's biggest single building transaction in the U.S., pointing to improved demand in the Manhattan property market.
"You can't get a stronger vote of confidence for the strength of the New York office market," Dan Fasulo, a Real Capital managing director, told
Bloomberg
. "When one of the most prestigious modern corporations makes a bet on your marketplace, it's not just a bet on your real estate, but in New York as a place to retain and attract the best talent."
Google currently rents 550,000 square feet of space on the western end the building, at 76 9th Avenue. Building co-owner
Taconic Investment Partners
said the building is the second-largest in New York City and originally served as the headquarters for the Port Authority of New York.
Real Captial said the building was valued at $1.1 billion when co-owner Jamestown, an Atlanta-based real estate investment firm, bought an interest in it in 2004.
A near-$2 billion price tag would mean each square foot of space in the building is worth around $690.
|
Nike
(NKE) - Get Report
and
WebMD
(WBMD)
also rent space in the building.
Google's headquarters are in Mountain View, Calif.
Taconic and co-owner
New York State Common Retirement Fund
have been marketing the property through investment advisor
Douglas Harmon of Eastdil
. The building is 98.7% leased and parking is available in the building, the
Post
reported earlier this year.
It would make sense for Google to buy the former transportation authority's hub because of its numerous back-up generators, electrical power capabilities and high-tech facilities, according to a report in
The New York Post
.
Other interested parties include local families, real-estate investment trusts, overseas entities from Beijing, Singapore, Chile, Argentina and Israel, as well as sovereign wealth funds from the Middle East and Asia, the
Post
report said in October.
-- Written by Miriam Marcus Reimer in New York.
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