AMZN Amazon.com Inc

New York officials enticed the tech giant with offers of several prize locations

By Katie Honan and Keiko Morris 

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (December 12, 2018).

In their bid for Amazon.com Inc.'s second headquarters, New York City and state officials dangled prime real estate at the tech giant and offered to use eminent domain to scoop up any necessary properties for a campus, newly disclosed documents revealed.

The city suggested four main neighborhoods as locations for Amazon's second headquarters: Midtown West, lower Manhattan, along the Brooklyn waterfront and Long Island City, Queens. In the bid, each neighborhood included tantalizing properties to serve as a potential campus.

One offering was the Farley Building, the historic post office that is being converted into a railroad station, with offices and a retail complex, in Midtown West. Another was 3 World Trade Center, the newest gleaming glass skyscraper at the World Trade Center complex.

The city and the state submitted the joint proposal to Amazon in the fall of 2017 in response to the retailer's announcement that it would conduct a nationwide search for the location of a second headquarters. The city's Economic Development Corp. released the proposal for the first time Monday night.

The release of the documents also came two days before the first of three City Council hearings that will discuss the so-called HQ2 proposal. On Wednesday, members of the council's economic development committee will look at the city and state's deal for Amazon.

"We wanted to be fully transparent about actions we have taken on this project to date, and are proud of them," a spokeswoman for the Economic Development Corp. said in an email after the proposal's release. "We felt that it was important that the public knows that we pitched NYC for its talent, real estate, infrastructure and industry strengths."

The company announced in November that it would split its second headquarters between Arlington, Va., and Long Island City, after a monthslong process in which the company considered pitches from 20 finalists.

New York City and the state agreed to provide up to $3 billion in tax incentives as part of the deal to have Amazon build its campus in Long Island City and bring at least 25,000 workers to the site over the next decade. The company is expected to bring as many jobs to Arlington in roughly 10 years as well. By 2019, Amazon plans to bring 700 jobs to the Queens site and 400 to Arlington.

Other bids provided larger incentive packages. New Jersey and Newark offered $7 billion in its proposal while Maryland put up about $5 billion in its bid. Still, local New York politicians and residents have criticized the Long Island City deal for being negotiated in secret without a public review process.

Like other cities that bid on HQ2, New York presented Amazon with a full list of site features, including zoning, the property owners, transit options, amenities and the effective rents. For One Court Square, one of the properties Amazon selected, the proposal highlighted the opportunity for highly visible signage atop the tower. Long Island City was the cheapest of the four neighborhoods the city and state suggested. Rent prices ranged from $24 to $49 a square foot.

New York City's proposal resembled other proposals made public, giving Amazon voluminous marketing pitches with statistics and details on each city's economy, its labor force and educational system as well as programs addressing existing inequities and climate change.

A spokesman for Amazon said Monday night that, as part of the company's national search of more than 200 cities, it considered a variety of criteria, including the talent pool.

"But we also specifically sought to be in a diverse city and in an exciting community," the spokesman said. "Long Island City is just that, and we want to be stitched into the fabric of what is a dynamic neighborhood."

The spokesman said the company is just beginning to meet with residents and community leaders. Mayor Bill de Blasio and Gov. Andrew Cuomo announced on Tuesday the formation of a community advisory committee composed of 45 Queens community leaders who will provide input on Amazon's headquarters in Long Island City, public amenities and infrastructure upgrades.

The proposal, which was put together by the Economic Development Corp. and the state's Empire State Development, didn't limit its real-estate suggestions to New York City. Amazon had its pick of dozens of sites around the state, including in Long Island and the Hudson Valley, the proposal shows.

Empire State Development also offered to aid Amazon in obtaining property.

"Subject to public approvals, ESD is empowered to acquire, encumber and dispose of any real property interest, including through eminent domain, " the proposal stated.

"ESD can also override local zoning, offer tax subsidies while holding title to a property, and provide lower-cost financing or grants to economic development projects."

New York's bid also touted the city's relatively low rent, when compared with the median rents in San Francisco, Los Angeles and Washington, D.C., and diverse housing stock.

"Whether Amazon employees want to live in an apartment among the best restaurants and bars in the world, or in a house within walking distance of great parks and schools, they'll find a home in New York City, and we continue to add units," the proposal said.

Write to Keiko Morris at Keiko.Morris@wsj.com

(END) Dow Jones Newswires

December 12, 2018 02:47 ET (07:47 GMT)

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