Alphabet Inc.’s (GOOGL - Free Report) division Google has been gobbling up properties and rapidly expanding its footprint in the United States.
Reportedly, the tech behemoth will invest more than $1 billion to expand its presence in New York. The new leased campus at Hudson Square in NY will likely span 1.7 million square feet and be the primary location for Google’s global business organization.
The most recent deal will make Google the second major technology company to expand in New York and create thousands of jobs. This deal is expected to double Google’s employee strength in New York, which currently stands at 7,000 people.
Property Buying Spree Continues
The company has spent billions in property acquisitions over the past few years.
Google recently agreed to pay $110 million to buy more than 10 acres from the city of San Jose, as part of its expansion plans. The company also bought the Chesapeake Commons office park in Sunnyvale earlier this year.
Google has not kept its eyes only on Silicon Valley. In fact, it has been making purchases outside of Silicon Valley as well. Earlier this year, the company spent $2.4 billion to buy New York City's Chelsea Market.
Google is likely to have a competitive edge over other tech bigwigs such as Amazon and Apple, with its office expansion in New York.
Just last month, Amazon selected Long Island City, NY and Arlington, VA for building its new headquarters. Also, Apple said that it would invest $1 billion to expand its operations in Austin by constructing a new employee campus in the area.
New York, often considered the hub of talent, reportedly reached 128,600 of tech employment last year. Consequently, further expansion in the city is likely to be a major positive for the search giant.
The most recent purchase is in line with the company’s strategy of actively snapping up properties and continuing expansion in New York. Such prime asset buyouts should definitely enhance overall asset quality and help it carry on with its new growth initiatives.
In addition, we believe that job creation will add efficiency to its production and operations by bringing more talent and expertise to the company.
The chief financial officer of Alphabet and Google said, "Our investment in New York is a huge part of our commitment to grow and invest in U.S. facilities, offices and jobs. In fact, we're growing faster outside the Bay Area than within it".
Zacks Rank & Stocks to Consider
Amazon currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader technology sector include AMETEK, Inc. (AME - Free Report) , QuinStreet, Inc. (QNST - Free Report) and Stamps.com Inc. (STMP - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Long-term earnings growth rate for AMETEK, QuinStreet and Stamps.com is currently pegged at 11.18%, 25% and 15%, respectively.
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