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Google bets $1bn on London and hybrid work with office buy

Google London office
Image credit: Google

Google is spending $1bn (£730m) to purchase a London office building in a major boost for the capital and a sign that the tech giant is betting on a return to physical workplaces.

The internet search and advertising behemoth said on Friday that it’s buying the Central Saint Giles development located in London’s West End. The US firm currently rents space in the brightly coloured building, which included 38,000 sq metres of office space.

It has also promised a multimillion-pound refurbishment of the office to add extra meeting rooms, “team pods” and covered outdoor working areas.

The investment will be seen as a vote of confidence in London at a time when many offices remain empty or at partial capacity due to Covid-19 work from home guidance.

Chancellor of the Exchequer Rishi Sunak said the investment was “proof that this country continues to be one of the most attractive places in the world for leading firms to grow their business”.

It is also a doubling down for Google on its London presence. The Silicon Valley company is already spending an estimated $1bn to construct a separate one-million-square-foot building in King’s Cross – just two miles away from the Central Saint Giles office.

Construction on the 330-metre-long building is expected to be completed this year.

The two office spaces, plus a separate office in Manchester, will give Google the capacity to hold up to 10,000 employees across the UK.

Ruth Porat, the chief financial officer of Google and its parent company, Alphabet, said the purchase of Central Saint Giles reflected the company’s “continued commitment to [the UK’s] growth and success”.

It comes as the tech giant added 700 UK staff last year, bringing its total headcount in the country to 6,400.

The nature of Google’s software-focused work means it’s a company primed for its staff to work remotely. But by increasing its physical workspace capacity the tech company has financially backed its commitment to a hybrid workforce.

“We believe that the future of work is flexibility. Whilst the majority of our UK employees want to be on-site some of the time, they also want the flexibility of working from home a couple of days a week,” said Ronan Harris, vice president and MD of Google UK and Ireland. “Some of our people will want to be fully remote. Our future UK workplace has room for all of those possibilities.”