Search and occupy.
Google is in talks to lease a massive spread at the Starrett Lehigh building that landlord RXR Realty is freeing up just for its favorite internet search giant.
The world’s second-largest company by market cap is in talks to lease, on a short-term basis, more than 200,000 square feet formerly occupied by Tommy Hilfiger inside the leviathan building at 601 West 26th Street, several sources told The Real Deal. RXR, sources said, is looking to give Google a temporary berth while the landlord builds out Google’s office space along the Hudson River at SuperPier, which RXR co-owns with Youngwoo & Associates.
A representative for RXR declined to comment, and a spokesperson for Google could not be immediately reached.
Google signed a lease at the SuperPier in December 2015 for about 250,000 square feet. The search giant is known for rapidly outgrowing its space, and the Starrett Lehigh building offers that flexibility: the building could accommodate Google’s need for an office of up to 500,000 square feet, given the Tommy space and other space in the property that could be made available by buying out current tenants, people familiar with the negotiations said.
Scott Rechler’s RXR, which owns Starrett Lehigh with the Blackstone Group, is negotiating with Aby Rosen’s RFR Realty to take back roughly 226,000 square feet of the former Tommy Hilfiger space. Rosen took over lease payments for Hilfiger parent company PVH after it relocated to his Midtown East office building at 285 Madison Avenue.
Google had reportedly checked out space last year at Manhattan West, but sources said it got bumped by Amazon when the e-tailer signed a lease for 360,000 square feet at Brookfield Property Partners’ 5 Manhattan West.
The Silicon Valley-based tech giant was also rumored to be checking out spaces in Hudson Square, but the deal at Starrett Lehigh makes sense for several reasons. Aside from the relationship with RXR, the 2.3 million-square-foot building is a short walk from the pseudo-campus Google’s built for itself at the edge of West Chelsea and the Meatpacking District.
Google owns the former Port Authority headquarters at 111 Eighth Avenue, which it bought from Taconic Investment Partners for $1.77 billion in 2010. But while the hulking, 2.9 million-square-foot property is one of the largest buildings in the city, Google can’t buy out existing tenants fast enough to meet its needs.
The company also leases nearly 400,000 square feet across at Jamestown Properties Chelsea Market, where it’s set to muscle out other tenants in the building when their leases come due.
Google also has about 240,000 square feet at Vornado Realty Trust and the Related Companies’ 85 Tenth Avenue, which sits in between 111 Eighth and SuperPier, forming a string of offices in the neighborhood.
Hiten Samtani contributed reporting.