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Why are big tech companies buying huge office properties?


The tech giants have spent billions of dollars buying real estate and office buildings despite their plans to embrace remote working.

The remote working landscape looks confusing, after Google announced yesterday that it is buying the office building it currently leases on West Side Manhattan for $ 2.1 billion. in one of the most expensive office building sales in US history.

Google is leasing the over 1 million square foot building, with a purchase option, which the company said it would exercise in the first quarter of 2022.

Google was one of the prime companies to adopt the remote work approach since the beginning of the epidemic and said in previous statements that it intends to give its employees this option in permanently.

Google’s moves come as major financial firms like JPMorgan and HSBC are abandoning or renting out their huge Manhattan buildings.

This may be one of the clearest indications that real estate remains the first investment option for anyone with additional cash reserves.

The tech giants have billions of dollars in cash reserves and a good opportunity to take advantage of the lower prices of office buildings in America.

Tech giants prefer New York to cheaper cities because of its pool of skilled workers and its appeal to many young professionals.

Tech companies ranked # 1 in leasing business in Manhattan for the second consecutive year, and Google bought a building in nearby Chelsea Market for $ 2.4 billion in 2018 and two more buildings nearby in Manhattan.

Last year, Amazon purchased the Lord & Taylor Building on Fifth Avenue, Fifth Avenue for $ 978 million

In September 2020, Facebook bought the headquarters of an unused 400,000-square-foot Washington retailer headquarters for $ 368 million.

Last April, Apple announced plans to open a new office in Raleigh, North Carolina, at a cost of more than $ 1 billion.

Its $ 1 billion home is also expected to open in Austin, in Texas, next year, in addition to its current circular headquarters in California, which is worth more than $ 4 billion.

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