Google Gets 60-Year Lease on NASA's Moffett Airfield

Search giant Google Inc. (GOOGL) has entered into a deal to lease the Moffett Federal Airfield and Hangar One from National Aeronautics and Space Administration ("NASA") for 60 years. The deal was carried out through Google’s real-estate subdivision Planetary Ventures LLC, which got the authorization to bargain for the airfield this February.

Per the deal, Google will pay around $1.16 billion in rent to NASA over the life term of the agreement. Google plans to spend an additional $200 million to revamp the three hangars, including the Hangar One, which is more than 80 years old.

Google intends to use the airfield for research, development, aviation, robotics and other new promising technologies. Google is increasingly extending its foothold into new markets and is using more resources to venture into budding technologies as it looks to go beyond its core online search services.

The Moffett Field is a joint civil-military airport located between northern Mountain View and northern Sunnyvale, CA. The most famous and visible sites on the field are Hangars One, Two and Three, which dwarf the surrounding buildings.

Hangar One, built in 1932, is one of the world's largest self-supporting structures covering 8 acres. It is one of the most noticeable landmarks in California's Silicon Valley. NASA’s Ames Research Center purchased the Airfield and Hangar One in 1994. Just a few years ago, the Navy peeled off the structures that were leaking poisonous chemicals, leaving its skeleton vacant in the airfield.

In 2012, Google offered to renovate the structure in exchange of using it to house eight of the company's private jets. But NASA turned down the proposal at the time.

With this deal, NASA has thus secured the Hangar’s future.

Google currently holds a Zacks Rank #4 (Sell). Akamai Technologies, Inc. (AKAM), 21Vianet Group, Inc. (VNET) and Baidu, Inc. (BIDU), all carrying a Zacks Rank #2 (Buy), are better-ranked stocks from the same sector and therefore worth considering.

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