Although real estate probably isn’t the first thing that comes to mind when you think of Google, there’s no question that it is, in fact, a real estate company. Alphabet (GOOG: NASDAQ), Google’s parent company, invested $13 billion in real estate across the country in 2019 and is reportedly the third-largest landowner in the Bay Area.
Google, the real estate company
Google even owns Chelsea Market in New York, which it purchased for $2.4 billion in 2018.
According to its most recent 10K, Google has nearly $40 billion in land and buildings on its balance sheet, along with over $21 billion of construction in progress. In fact, Google made the two largest real estate deals in the U.S. in 2018. That’s a real estate company for you, folks!
Google has over 120,000 employees, with the office space to show for it. The company’s 2 million-square-foot headquarters is in Mountain View, California, and is actually called “Googleplex.”
That isn’t even Google’s largest campus. The company's 111 Eighth Avenue building in Manhattan, which was purchased in 2010, is 2.9 million square feet.
Google has other offices throughout the country and world as well, including northern Virginia, Texas, and Massachusetts, to name a few.
Data centers provide a secure and reliable environment to house servers and other computing equipment. In many ways, these data centers are the heartbeat of Google’s high-margin technology businesses, such as search, Gmail, and YouTube.
Google owns data centers all around the world:
- 13 in the U.S.
- 1 in South America
- 5 in Europe
- 2 in Asia
In fact, data centers in general have their own real estate investment trusts (REITs).
Housing for employees
Google has thousands of employees, many of whom work in offices (during non-COVID times) that are in pricey neighborhoods. In an effort to help employees manage this, Google has tried to provide housing.
For example, in 2017, Google spent $30 million on housing for 300 of its Silicon Valley employees. Google owns the housing, which it then rents to employees. And in 2019, Google announced that it was pledging to invest $1 billion toward housing in its backyard over the next 10 years.
Google has also demonstrated a commitment to invest in renewable energy infrastructure projects. In 2019, Google announced its plan to invest $2 billion in wind and solar infrastructure projects all across the world.
Sidewalk Labs is Google’s incubator for testing out emerging technologies that can shape the future of cities in a more sustainable and accessible way. In 2017, Google announced the first project test site, a 12-acre facility in Toronto. Sidewalk Labs also makes direct investments in start-ups working on shaping the future of real estate.
The Millionacres bottom line
Although Google may not scream "real estate," investments in the real estate sector have been a core part of the company’s strategy. From data centers that house its servers to renewable infrastructure projects to help power those servers in a cheap, sustainable way to housing for its employees, Google certainly recognizes the importance of incorporating real estate into its operations.