Google announced Tuesday it was expanding its office inventory in the city with the purchase of 550 Washington Street for $2.1 billion.
The tech giant already leased space at the property, called St. John’s Terminal, from Oxford Properties, the Wall Street Journal reported, and will be exercising an option to buy the building, which the company said it expects to do in the first quarter of 2022.
The report noted the purchase marks the biggest sale of an office building since the pandemic, not only in New York City, but in the entire United States.
Oxford Properties is listed as a seller on the deal, as well as pension fund manager CPP Investments. The waterfront property, a former freight terminal, spans 1.3 million square feet.
In 2018, plans were announced to invest $1 billion into a Hudson Square campus, which included space at Jack Resnick and Sons’ 315 Hudson Street and Trinity Real Estate’s 345 Hudson Street.
Alphabet, the parent company of Google, owns $55.9 billion of real estate as of the end of the second quarter, including a collection of buildings clustered in downtown Manhattan. Google owns 111 Eighth Avenue and 450 West 15th Street. Back in 2018, the company purchased the Chelsea Market building for $2.4 billion.
The purchase of St. John’s Terminal is a big bet on the future of office work for the company, which employs approximately 12,000 employees in New York City. The building is currently under construction and isn’t set to open before mid-2023 at the earliest.
The deal comes months after Alphabet announced in May that about 20 percent of employees nationwide will work from home permanently, 20 percent will work out of offices at a new location and 60 percent will work from their current locations.
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[WSJ] — Holden Walter-Warner