REO Real Estate

Google Inc. (GOOG) is expanding its operations in Dublin by agreeing Thursday to pay EUR99.9 million for the city's tallest office building, in one of Ireland's largest property deals since the financial crisis.

The 67-meter Montevetro building in Dublin's Grand Canal Dock district, has 15 stories, 210,000 square feet of office space and can house about 2,000 staff.

Its developer, Treasury Holdings, started building it in March 2008, just as property prices were starting to slip into what would become a dramatic plunge. After running out of cash to complete the project, Treasury Holdings got working capital from Ireland's National Asset Management Agency, the government-body that has bought up large slugs of banks' impaired real estate development loans, including those that backed Montevetro.

The seller of the building is Anglo-Irish property investment fund Real Estate Opportunities PLC (REO.LN), a vehicle of Treasury Holdings whose largest holding is London's Battersea Power Station.

REO Chairman Ray Horney said the sale is one of the largest in Irish commercial property for several years, "and the company believes it has achieved a very good price in the current market environment."

NAMA Chairman Frank Daly said it got more than its money back on the bank loans it received, as well as on the additional funding it extended for the building's completion.

"The successful completion of the Montevetro development and its sale again reflect the positive potential of NAMA to support the commercial property market in Ireland without compromising its objective of recovering monies owed to the taxpayer," he said.

Ireland set up the agency as part of its effort to restore its banks to health but has since needed a EUR67.5 billion bailout from the European Union and International Monetary Fund. The country's biggest banks were hit hard by huge losses on loans to property developers, as a decade-long real-estate boom turned to bust.

No one at Google was immediately able to comment on its Dublin plans. The technology company has about 1,700 people currently working in the Irish city, its European headquarters, and said last month is aims to add about 1,000 people in Europe in London and other parts of the region.

-By Margot Patrick, Dow Jones Newswires; +44 (0)20 7842 9451; margot.patrick@dowjones.com

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