October 30, 2010

Google Bidding Around $2B For Infested NYC Office Building

Now we know how Google feels about rent versus buy!

Google Among Bidders for $2 Billion Building

By ANTON TROIANOVSKI

Google Inc. is a front runner to buy the massive building it occupies as its New York City headquarters in a deal that could be worth nearly $2 billion, according to a person familiar with the matter.

Other buyers from around the world are also chasing the block-long, 2.9-million-square-foot building in Manhattan’s Chelsea neighborhood, the person said. If the deal is done near $2 billion, the building’s sale would make it one of the largest acquisitions of a single property in New York.

Google, if it completes the deal, would be jumping into a real-estate market in which sales of well-located office buildings occupied by financially strong tenants—like Google—have been sparking bidding wars. Most recently, Boston’s tallest skyscraper, the John Hancock Tower, drew a flood of bids and a $930 million sale price.

image The building, known as both 111 Eighth Avenue and 76 Ninth Avenue, was a Port Authority of NY and NJ property, and is filled with backup generators, huge electrical power capacity, fiber optic cabling, and internet-ready offices.  Google is leasing half a million square feet of office space, including inside the building they hope to purchase.

At a $2 billion selling price, the deal works out to $690 a square foot for the 2.9 million sf, 18-story building in the fashionable Chelsea district.  The market for New York City office space has been selling for $400-500/sf, but $1500/sf was not uncommon during the bubble in 2007.

I hope Google is really determined to stay there, because, like several Manhattan office buildings, bedbugs have been discovered at Google-NYC.

“Like several other businesses in New York City, we’ve discovered bedbugs in a small area of our office,” the spokeswoman said. “We have notified employees and are taking steps to treat the affected area.”

I think they should get a vermin discount.  What do you think is fair?

No matter what anyone says about buying in the Real Bay Area, at least Mountain View office buildings are bedbug-free.  Are you listening, Google?

Comments (3) -- Posted by: madhaus @ 5:09 am

3 Responses to “Google Bidding Around $2B For Infested NYC Office Building”

  1. nomadic Says:

    Maybe GOOG can figure out how to make the bedbugs pay rent.

  2. Tuno Says:

    do they appear on Sheet View?

  3. The Next Bubble: Right In Your Neighborhood [Burbed.com] Says:

    [...] For example, Google tried to buy Groupon for six billion dollars.  Six.  Billion.  Dollars.  For a company that throws up virtual coupons on the Internet.  A company based in Chicago.  And Groupon said NO.  I guess they think they’re worth more than… Six.  Billion.  Dollars.  For a little reality check, the biggest acquisition Google ever had was paying $3 billion for DoubleClick, in 2007.  Good thing they didn’t do anything foolish back then like buy an office building in Manhattan. [...]


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