America’s finance capital is getting colonised by Silicon Valley. Google’s planned US$1-billion expansion in New York will solidify its dominance as the city’s top big-tech office tenant — but only until Amazon.com arrives.
Google now ranks 12th by leased office space in Manhattan, with 167 225sq m, including two agreements announced on Monday, according to Cushman & Wakefield. The company, a division of Alphabet, also signed a letter of intent to occupy about 121 000sq m of space at 550 Washington Street, which would move it to sixth on the list, with 288 000sq m, according to Bloomberg calculations.
“When the Googles of the world and the Amazons of the world announce decisions like that, other tech companies don’t necessarily pile on, but they notice that, oh, this is a place to be,” said Peter Muoio, chief economist at Ten-X Research, a unit of real estate firm Ten-X Commercial. “This really cements that it’s not really just a secondary kind of market, that it’s really becoming a tech capital.”
Leading the list is co-working company WeWork and finance industry stalwarts including JPMorgan Chase & Co, Citigroup and Morgan Stanley, according to Cushman & Wakefield. Google’s latest investment helps cement its position as Manhattan’s largest big-tech office occupier.
Google said Monday that it reached lease agreements at 315 and 345 Hudson Street that would add about 37 000sq m. That, along with Washington Street, will create a campus called Google Hudson Square, the company said.
Even with the expansion, the total is still well behind Amazon, which plans to add as much as 743 000sq m of commercial space across the river in the Long Island City neighbourhood of Queens over 15 years. Apple also recently outlined its intention to grow in the Big Apple.
In addition to its leased space, Google also owns real estate and has made purchases that rank among the largest ever in Manhattan. In 2010, it bought 111 Eighth Avenue, its New York headquarters, for $1.8-billion. Earlier this year, it paid $2.4-billion for the nearby Chelsea Market. — Reported by Prashant Gopal, Lily Katz and Justina Vasquez, with assistance from Gerrit De Vynck and Christopher Cannon, (c) 2018 Bloomberg LP
