Google Purchases 111 Eighth Avenue, NYC

http://googleblog.blogspot.com/2010/12/investing-in-new-york.html

by jamesjyu • 16 years ago

69 40 16 years ago

googleblog.blogspot.com

rickmode• 16 years ago

What ever happened to the idea that a company should avoid purchasing and managing real estate and instead focus on its core competency?

phlux• 16 years ago

>"As part of the deal, we’ve retained Taconic Management Company to continue the leasing oversight services and management of the building on our behalf"

The building cost ~1.9 BILLION -- may be one of the most expensive real-estate deals yet.

kqr24• 16 years ago

Google is estimated to have about $33 billion in cash (maybe $31 billion now).

Google manages its money like a private hedge fund. Considering currency fluctuations, real estate is often considered a good hedge against inflation so it may seem like a smart move in the future.

http://www.silobreaker.com/google-net-cash-reserves-up-70-pc...

http://www.fool.com/investing/general/2010/06/07/google-the-...

jonprins• 16 years ago

Not really.

Tishman Speyer Properties and Black Rock Realty jointly bought Stuyvesent Town and Peter Cooper Village (two very large, sprawling apartment complexes in Manhattan) for over $5bn, back in '06. Of course, they had to give it up in January because things didn't work out quite like they expected (rent controlled apartments don't give up the ghost easily; they'd wanted to turn them into high-class ibanker condos).

Source: http://www.theatlanticwire.com/opinions/view/opinion/America...

joezydeco• 16 years ago

The building is a massive colocation site the size of a city block. It seems right up Google's alley.

brown9-2• 16 years ago

It's more than that, it's also a giant office building.

Here is the previous (large) HN discussion on this topic, there is nothing new in the blog post linked to here: http://news.ycombinator.com/item?id=1965686

uxp• 16 years ago

I know of a large holding company of luxury jewelry goods that has space in the building. For them, its not just cubicles. It would be a very poor publicity stunt to kick everyone out of the building in order to install racks and servers in every room.

Other companies have enough leverage in non-internet related fields to cause a big shitstorm if it was to happen. If this is a long term approach I could see them not renew or assign new leases when current tenants vacate, but you will not see press releases. I also have no association with this story, so I can only speculate as well.

oiuytriuytr2• 16 years ago

Just think of it as a really big rack enclosure

jkent• 16 years ago

I would think that Google probably don't need or want to colo in Manhattan. Jersey is only milliseconds away.

That being said, a growing NY engineering staff probably don't want to be in Garden City.

mikeryan• 16 years ago

Google is flush with cash, the real estate market is soft and it beats renting. Honestly I think more tech companies should look to own their real estate. Its a solid asset in the balance sheet. Most companies already have an in house facilities team who's job it is to maintain their property and you can always hire a property management firm to handle the rest.

My step dad owns a few faucet stores, granted totally different field, in the Bay Area, he owns the buildings of all his stores and the value of his real estate holdings are the equivalent of the value of his business.

kqr24• 16 years ago

The counterargument is that real estate is potentially an opportunity cost. Instead of purchasing real estate, that money could be used to grow your "core competency", e.g. opening more stores, expanding into other cities, etc.

kvs• 16 years ago

They can always sell it when the price is higher and lease it back.

patrickgzill• 16 years ago

It is a massive datacenter in addition to having office space. Plus, so many VOIP and Web companies are already there, it is a perfect place for Google to interconnect fee-free (or nearly so) with them.

samratjp• 16 years ago

Or buy them - it's chunk change anyways :-)

dspeyer2• 16 years ago

Google isn't managing it. The existing management company is keeping the job. Google is just owning it.

philiphodgen• 16 years ago

Does this real estate acquisition mark the beginning of Google's decline, per the late C. Northcote Parkinson's laws?

http://www.02articles.com/read/parkinsons-law-chapter-6

ams61102• 16 years ago

111 Eighth Avenue (also known as 76 Ninth Avenue)

Come again???

Even if the building has faces on both 8th and 9th ave, 111 and 76 would be on two different blocks no?

dhyasama• 16 years ago

The building is a full block, between west 15th and 16th, with entrances on 8th and 9th.

waterlesscloud• 16 years ago

111 8th Ave. http://maps.google.com/maps?f=q&source=s_q&hl=en&...

76 9th Ave. http://maps.google.com/maps?f=q&source=s_q&hl=en&...

Oddly, yes, the same building. Huge building.

aneesh• 16 years ago

Nope, odd numbers on one street will mean even numbers on the other.

  Odd numbers
  ---------------------------
  9th ave
  ---------------------------
  Even numbers


  **Google Building**


  Odd numbers
  ---------------------------
  8th ave
  ---------------------------
  Even numbers

riffic• 16 years ago

nyc has a non-standard block numbering scheme.

joshu• 16 years ago

Neat building. It used to be used as an "inland dock" - It has elevators that can hold an entire 18-wheeler, which can be unloaded inside the building.

Google Purchases 111 Eighth Avenue, NYC

Related Stories