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Google buys New York's Chelsea Market for $2.4 billion

The search giant already occupies a large chunk of the 1.2 million-square-foot complex in lower Manhattan.

Google Plans To Expand NYC "Campus" With $2.4 Billion Real Estate Purchase

Outside Google's New York office in lower Manhattan.

Spencer Platt/Getty Images

Google is taking over an even bigger chunk of the Big Apple.

The search giant, and world's second most valuable company by market capitalization, plunked down $2.4 billion Tuesday to buy New York's famous Chelsea Market. The seller was Jamestown, a real estate investment and management company based in Atlanta and Cologne, Germany. The deal had been reported to be in the works earlier this year.

Google already occupies a large chunk of the 1.2 million-square-foot complex, which is best known for its ground floor hall filled with restaurants and shops that's visited by a half million New Yorkers and tourists every month. The former Nabisco factory takes up a full block between Ninth and 10th avenues and 15th and 16th streets.

The purchase marks Google's continued expansion in New York. It arrived in the city nearly two decades ago and now has roughly 7,000 employees there. The deal also highlights the growing fortunes of US tech giants, which are all working to build up their workforces, business operations and real estate, even as the public weighs the benefits and costs of these increasingly powerful organizations.

Google's expansion comes at the same time Amazon is considering where to place its second headquarters, with an expected workforce of 50,000. New York is among the 20 finalists in Amazon's selection process.

This isn't the first big deal between Google and Jamestown. In 2010, Jamestown and its partners sold 111 Eighth Ave. to Google for $1.77 billion. That property is directly across from Chelsea Market. 

"This purchase further solidifies our commitment to New York, and we believe the Manhattan Chelsea Market will continue to be a great home for us and a vital part of the neighborhood and community," David Radcliffe, Google's vice president of real estate and workplace services, said in a blog post Tuesday.