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Amazon gobbles up its HQ Real Estate for $1.16 Billion
According to Reuters, the purchase is the largest in the country so far this year and puts Amazon in very elite company—no other has buyer has spent anything north of a $1 billion on commercial property in 2012.
So what does $1.16 billion get Amazon?
As you can imagine a multi-billion dollar operation like Amazon requires some amount space for its HQ and that is precisely what the retailer has received as a result of the buyout. There are a reported 11 buildings which combined occupy a total area of 1.8 million square feet.
The purchase which incidentally is connected to Microsoft co-founder Paul Allen (he owns Vulcan Real Estate who is handling the sale), is reported to be the most ever spent on 100,000+ square feet of commercial property in the Seattle area. Typically buyers spend around $308 per square feet for commercial property in the area; Amazon has more than doubled that with its present $644 per square feet purchase.
Amazon certainly has deep pockets and so the purchase is unlikely to kick-start a trend across the area. Companies are still cautious amid the economic uncertainties that exist in the general economy. Amazon also has the benefit of being an online retailer and Christmas shopping is just around the corner. Many are predicting an uptick in online purchases this year and so Amazon could find itself recouping its $1 billion spend in a matter of months—and if not by Christmas, certainly by the end of April.
Is $1.16 billion too much for commercial property? Even if you aren’t a real estate expert, do share your thoughts on the Amazon extravaganza below.