Google to Buy New York City Office Building for $2.1B

The deal for the new building on Manhattan's West Side is the most expensive sale of a single U.S. office building since the start of the pandemic-and one of the priciest in U.S. history, according to data company Real Capital Analytics. In recent weeks there is evidence that cheaper space is luring back corporate tenants, which have been shrugging off delays in returning to the office because of the Delta variant and are planning for the years ahead. In Manhattan, office asking rents are down to where they were in 2017, but August leasing activity for Midtown was more than double the previous month, according to real-estate firm Colliers. In March, private-equity firm KKR & Co. paid $1.1 billion for a San Francisco office building leased to Dropbox Inc., the most expensive office sale in the city in more than a decade. Sundar Pichai, chief executive of Google parent Alphabet Inc., said last month that the company would delay its return to the office until January. The Manhattan office purchase underscores how the company views office space as an important part of its long-term strategy. Mr. Pichai told employees that most of them would end up spending around three days a week in the office and two days working remotely, according to a May email he wrote to employees that Google published. Google has been expanding its New York offices in recent years and now employs around 12,000 people in the city-its biggest workforce outside California.