Google to Buy St. John’s Terminal in NYC for $2.1 Billion
(Bloomberg) -- Google is cementing its status in New York City, and a commitment to in-person work, with plans to purchase a Manhattan office building for $2.1 billion.
The company, whose parent is Alphabet Inc., has already been leasing St. John’s Terminal on the far west side, and the decision to exercise an option to buy the site builds on plans to invest more than $250 million this year in its New York real estate, Chief Financial Officer Ruth Porat said in a blog post Tuesday.
Since it first set up shop in New York more than 20 years ago, Google now counts 12,000 employees in the city, its largest office presence outside California. The company aims to increase its New York-based workforce to more than 14,000 in the coming years, she said. Buying St. John’s Terminal, at 550 Washington St. in the Hudson Square neighborhood, also fits in with Google’s commitment to racial equity, which includes expanding in diverse communities, Porat added.
Google, along with other major U.S. technology companies including Facebook Inc., has been growing in New York for years. The search-engine giant owns several buildings in the Chelsea neighborhood, and its 1.7 million-square-foot Hudson Square campus serves as its New York headquarters for global business, which includes sales and partnership teams.
The purchase is the biggest single-building transaction since the beginning of the pandemic, New York Mayor Bill de Blasio said at a press briefing Tuesday.
“Google is leading the way in our economic comeback,” he said. The mayor added that the company is attracted to New York because of its “extraordinary talent pool” and “the most diverse population” in the nation.
“It sends a message to the larger tech community,” de Blasio said. “This is the place to be.”
Google’s commitment to office space in New York, even as the city struggles to recover from the pandemic, suggests the company expects some form of in-person work to be vital to its future. Google has said it will ask employees to work in a “hybrid” model, with about 60% going back to the same offices as before the pandemic. Last month, it pushed back its return-to-office plans until January 2022.
“Coming together in person to collaborate and build community will remain an important part of our future,” Porat said in the blog post. “It is why we continue investing in our offices around the world.”
St. John’s Terminal, developed by Oxford Properties Group, is a former freight facility that Google is transforming with sustainable design and outdoor spaces, connecting the Hudson Square neighborhood to the waterfront. The property will offset 100% of its carbon in support of Google’s climate goals, the company said.
Oxford acquired the site in 2017. Along with its recent sale of One Memorial Drive near Boston, the firm said it has executed the two largest single office asset deals announced this year.
The St. John’s Terminal transaction will close in the first quarter of 2022, Google said.
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