They want the entire building badly for years now so it makes sense to overpay and grab the deal right now before another developer comes in with a more competitive offer, knowing Google would not move away! $2B for this is not expensive, considered how much they had paid to other short-term leases. Moving to and decorating new office space will cost them many millions. If they can own the building, $2B is a big saving in the next decade (and I presume the purchase would come with a property tax credit). Google has enough money to buy ten of these in NYC. Finally consider the property value should Google ever want to sell the property or lending out.
Though if this was up to me, I would buy a land and build another giant Google Campus. But that's just me.
For $2B you could probably buy a nice village by the sea with great weather all year round. Having worked in downtown NYC, I'd pick a beach any day of the week. But I can see the value of a large marketing, finance and sales presence for a Google type firm in the city. Engineering not so much.
I agree. I think the convenience of locating in Manhattan makes sense. For CA, since everyone travels, it doesn't matter (though they do have an office in SF!) I wouldn't mind traveling to NJ if Google picks me up like Google does in CA :-) Bell Lab would have been the perfect campus location for Google :/ (see [1])
Though if this was up to me, I would buy a land and build another giant Google Campus. But that's just me.