After they had announced that they would delay their reopening due to the updated CDC guidelines, a person wearing a mask walks past the New York Google Offices. This was in response to the outbreak of coronavirus disease (COVID-19), in Manhattan, New York City, U.S.A, July 29, 2021.
Google announced Tuesday that it plans to purchase a New York City office block for $2.1 billion. This is despite the fact that most of its employees remain remote.
According to The Wall Street Journal and Real Capital Analytics, this purchase is the most expensive ever for an office building in the United States. The Journal reported the news first.
Google has already leased the building, and stated that it will exercise its option to buy the St. John's Terminal building located in Manhattan's Hudson Square neighborhood. Ruth Porat, the CFO, stated that the building would be "the anchor" for its new campus.
This deal is good news for New York, as it emerges from the pandemic. However, major employers like Google have delayed their return-to office dates. Google told employees that they won't have to return to work until January. The CEO of Google previously stated that he expected 20% of employees will continue to telecommute after the reopening.
Google, along with other tech companies, has prospered during the pandemic. It brought in significant revenue that can be used to invest in real property and other initiatives. During shutdowns, internet services were more important to consumers, for education, work, and entertainment.
These plans will increase Google's already large footprint in Manhattan. Google previously stated that it would invest $250m in New York City in this year's capital and increase its workforce in the area from 12,000 people to 14,000 in the coming years.
Google intends to open the St. John's Terminal site located at 550 Washington Street in mid-2023. According to Ruth Porat, Google's CFO, the site will be the largest office outside California. The campus will be about 1.7-million-square-feet and house Google's sales and partnerships teams.
Google anticipates that the deal will close in the first quarter 2022.
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