Google Pays $1.9 Billion for 111 Eighth Ave.
What would you do with $1.9 Billion in cash? Turns out Google has not yet decided.
Despite what initial press releases reported, the internet search company is choosing to finance the enormous and coveted 111 Eighth Avenue. The $500 million loan from Bank of America will allow Google to keep the existing mortgage, saving more than $14 million in transfer taxes.
Billed by management company Taconic Investment Partners as a “Class A Office Building where Chelsea meets the Meatpacking District,” this 18 story, 2.9 million square foot behemoth was remodeled in the 90s and wired to the hilt to accommodate operations for data center and telecom companies. Occupants include Digital Realty Trust, Equinix, Telx and, of course, Google. The building takes up the entire city block between 15th & 16th Streets and 8th & 9th Avenues.
While perhaps not entirely altruistic, Google may be doing New York City landlords a great service. The rumor that they intend to take over the building (which they currently occupy just over a fifth of) as leases expire could help drive down the citywide vacancy rate that has been stubbornly hovering around 11%.
The building is said to be a barometer for New York real estate, and Google beat out a number of global investors who were interested in the property. We’re anxious to see where they turn their sights next.
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