By Laura Stevens
Amazon.com Inc. on Thursday announced a short list of 20
metropolitan areas for its planned second headquarters, kicking off
an intense final selection in the contest for the tech giant's
investment and jobs.
The finalists, chosen from among 238 places that applied in
October, included New York, Boston and Chicago, all big cities with
convenient access to airports, robust tech talent and sufficient
mass transportation.
Some surprise candidates included Columbus, Ohio, and
Indianapolis.
Amazon says it expects to create as many as 50,000 jobs paying
an average of $100,000 or more and generate more than $5 billion in
investments over nearly two decades.
The company also expects to build or acquire 500,000-plus square
feet of office space to open the first phase of its project as soon
as next year, according to its request for proposals. Amazon said
Thursday it expects to make a location decision in 2018.
The promise of those benefits has triggered a bidding war among
applicants, in what economic-development experts have said is one
of the most public and broadest contests to woo corporate
investments in decades. Cities and regions across North America
have offered big incentives and quirky proposals to try to attract
the online retail giant.
The race puts Amazon in the position of kingmaker for cities
across North America at a time when its business is booming. But
the choice to split headquarters also comes as technology giants
face more concerns about their increasing dominance in certain
industries.
President Donald Trump has called out Amazon on Twitter over
issues including state taxes and shipping with the U.S. Postal
Service.
Meanwhile, Amazon founder and Chief Executive Jeff Bezos has
recently stepped up his political game, last week donating $33
million to scholarships for undocumented immigrant high-school
graduates.
Mr. Bezos also became one of the first tech chief executives to
join legal action opposing Mr. Trump's travel-ban order last
year.
Those moves have prompted some site-selection experts to
speculate Mr. Bezos may choose a location where an influx of
workers could help promote political change. Indeed, a flood of
high-paid tech workers and their families could bring significant
changes to even major metro areas, potentially pushing up wages and
housing prices, which has been the case in Amazon's home market of
Seattle in recent years.
The Full List of Cities
-- Atlanta
-- Austin, Texas
-- Boston
-- Chicago
-- Columbus, Ohio
-- Dallas
-- Denver
-- Indianapolis
-- Los Angeles
-- Miami
-- Montgomery County, Md.
-- Nashville
-- Newark, N.J.
-- New York City
-- Northern Virginia
-- Philadelphia
-- Pittsburgh
-- Raleigh, N.C.
-- Toronto
-- Washington D.C.
Amazon said it will work with all of the candidates over the
coming months to further evaluate the locations.
"Getting from 238 to 20 was very tough -- all the proposals
showed tremendous enthusiasm and creativity," said Holly Sullivan,
who has been running the process, in a statement. She added that
the company has learned about new communities that it will also
consider for future investments.
The company's in-house economic development team has been
examining the proposals to create its short list since they flooded
into Amazon's current headquarters late last year.
At the top of the company's criteria is finding enough tech
talent to fill all the jobs, according to people familiar with the
matter.
Amazon's team helped narrow the list using criteria including a
metro area with more than one million people, a stable and
business-friendly environment, a location where it can attract and
keep tech talent and communities that think big when it comes to
locations and real estate, according to the request for proposals.
They also factored in sustainability, fiber and cell connectivity
and cultural community fit.
A wild card in the selection process may be incentives,
something that could help Amazon recoup its hefty spending on the
new site. Newark and its home state New Jersey, for example, had
announced a potential $7 billion in tax incentives to draw the new
campus. Most other cities declined to publicly disclose their
offers, citing the competitive nature of the process.
Amazon has grown rapidly since its founding in 1994 in Mr.
Bezos's garage as an online bookseller. The company is now not only
the largest online retailer, but also makes its own tablet and
speaker devices, sells cloud-computing services, is building a
significant content delivery network and, most recently, has become
a grocery giant. Last year it bought chain Whole Foods, adding more
than 470 brick-and-mortar stores to its retail empire overnight,
helping boost its workforce to more than 540,000.
The growth has fueled Amazon's revenue to record heights,
reaching $43.7 billion in the third quarter, more than double the
total three years earlier. During that period, the company's stock
roughly tripled, and on Wednesday closed at $1,295, near its
all-time high.
Amazon has started to outgrow its current home of Seattle, where
it employs more than 40,000 and dominates a significant piece of
the city's downtown.
After the new location opens, Amazon has said executives will be
allowed to decide whether their teams are is based in Seattle, the
new city or both. Some management experts have questioned the
company's plan, saying it could be difficult to maintain a strong
culture when spread across two headquarters.
Amazon still plans to grow in Seattle, too. In an interview with
The Wall Street Journal late last year, retail chief Jeff Wilke
said the company expected to add 2 million square feet and 6,000
people over 12 months. "But we think it's important if we're going
to continue to grow, to make sure we have the space," he added.
Small towns and counties from states including Texas and Maine
and cities ranging from Anchorage, Alaska, to Sacramento, Calif.,
applied for the new headquarters. Multiple places in Canada and
Mexico applied, too.
Site-selection experts say that the last such public bidding
process was likely in the 1980s, when General Motors prompted
governors to take to TV in an attempt to woo a car manufacturing
plant.
Write to Laura Stevens at laura.stevens@wsj.com
(END) Dow Jones Newswires
January 18, 2018 09:57 ET (14:57 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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