Charles Lynn - Real-Estate Analyst
Amazon recently announced plans to open a second North American headquarters. The technology giant is asking state and local governments to submit proposals for the potential development. According to Bloomberg estimates, such a development could cost $15 billion over 15-20 years and bring along up to 50,000 employees.
While Amazon released an 8-page invitation for bids, the firm’s exact criteria remains ambiguous. A few desired traits are clear:
- A population greater than 1 million
- A business-friendly environment
- An ability to “attract and retain strong technical talent,” most likely including top universities in the area
- A robust local transportation system, including an established international airport
- High quality of life and cultural fit with Amazon
- Tax and financial incentives, perhaps similar to recent Boeing and Foxconn deals
If past history can serve as a precedent, it is likely Amazon will look to create a bidding war among cities for the most favorable package. Here are 5 major contenders for HQ2:
Boston, MA: A logical pick. Boston recently landed a similar deal with General Electric and there is waterfront property ripe for development. Harvard and MIT would provide Amazon easy access to top talent and the area is emerging as the Silicon Valley of the East. However, Mayor Walsh has recently suggested that the city does not intend to enter another corporate bidding war and a tight housing market could be a concern.
Charlotte, NC: Home to one of the busiest airports in the country, Charlotte is an interesting option. With a lower cost of living than many other competitors listed and a pro-business government, Charlotte could offer a lucrative package. Bank of America has a significant stronghold on the city and Amazon would represent a major threat to retaining talent. As one real estate executive I spoke to put it: if Bank of America does not want Amazon in Charlotte, Amazon will not be there.
Denver, CO: The only option west of the Mississippi listed. Denver checks many boxes, with its strong transportation network, outdoorsy culture, low cost of living, and effective governance. If Amazon chooses to stay west, this may be the spot. However, many feel Amazon would be best served on the east coast.
New York, NY: The city that never sleeps. Amazon has invested in over 1 million SF in the five boroughs this summer. With proximity to headquarters of other high-powered firms and ample availability across a variety of office types, New York is almost too obvious of a choice. The potential desire to be a big fish in a smaller pond, and high costs of living and doing business, however, could sink a potentially great match.
Washington D.C: A dark horse candidate. D.C fits many of Amazon’s needs with potential locations available in suburban parks or urban centers. A D.C base would provide easy movement throughout the east coast. With Amazon falling under increased pressure from President Trump and the potential for antitrust issues as the firm expands, a D.C headquarters would be quite the statement and could be part of an effort to improve the firm’s regulatory environment.