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Amazon HQ2 Decision: Amazon splits the price between Crystal City and New York

Jonathan Connell Reports Covering Economic Development Focusing on Commercial Property and Trump Organization November 13 at 16:26 Amazon opens major…

Amazon opens major outlets in northern Virginia, Crystal City and in New York City, dividing up its sought-after investment of up to 50,000 jobs between the two East Coast sites, announced the company Tuesday.

“We are excited to build new headquarters in New York and northern Virginia,” Amazon founder and CEO Jeffrey P. Bezos said in a statement. “These two sites will allow us to attract world-class talent that will help us continue inventing for customers in the coming years. The team did a great job choosing these places and we look forward to becoming an even bigger part of these communities.”

The company also announced that it has chosen Nashville for 5000 jobs as part of a new Center for its Operations, which is responsible for the company’s customer tracking, transportation, supply chain and similar activities.

The election of Crystal City in Arlington County as one of the winners sets the northern Virginia reputation as a magnet for business and may possibly transform the Washington region into an eastern outpost of Silicon Valley in the next decade.

Valen came with a price tag, whose information only became public. Virginia Gov. Ralph Northam (D) and Arlington County leaders agreed to give Amazon direct subsidies totaling $ 573 million based on the company creating 25,000 jobs with an average salary of $ 150,000. The state and the county will also invest a total of $ 223 million for transport improvements that will benefit both Amazon and the rest of society.

This photo taken on November 7, 2018 shows views of Long Island City in Queens neighborhood in New York, along the East River. Amazon has decided to share its new headquarters between New York City and Crystal City, Va. [Image of Don EMMERT / AFP / Getty Images]

The money, subject to approval by the Virginia General Assembly, also includes $ 195 million in transport improvements to nearby subway stations, the Reagan National Airport and construct a walkway over connection to the company’s new hub as will be in a newly built neighborhood called “National Landing, which includes parts of Pentagon City and Crystal City in Arlington and Potomac Yard in Alexandria.

Virginia Tech plans to build a $ 1 billion university campus in Alexandria focused on innovation, part of the higher education package that the state offered the company.

Northam said Virginia tech talent and stable business environment were key to landing price. Make the formal announcement of the deal in a warehouse in Crystal City in a place that will eventually accommodate an Amazon property, he told a crowd of state and local officials and fathers lawyer: “We are dedicated to being at the forefront of the next technology and innovation breakthrough. “

Draped over the lecturer where Northam spoke a signage,” Virginia is for Amazon’s lover. “

New York leader offered Amazon more money – $ 1.85 billion, much of it also linked to the company’s growth and wages.

The decision is coming Northam and local leaders the biggest economic development in one generation – a promising billions of dollars in capital investment alone – but could also put pressure on the region’s already steep housing prices, congested roads and winding divisions between wealthy and low-income residents.

Northam said in a statement that He expected Amazon to invest $ 2.5 billion in the Commonwealth and create $ 3.2 billion in tax revenues.

According to a 25-page agreement between the company and the state, Amazon expects to employ 400 people in 2019 and 1,180 next year. It expects to create at least 25,000 jobs before 2030 and potentially a total of 37,850 by 2034.

“This is a big win for V irginia – I’m proud Amazon acknowledges the huge assets the Commonwealth has to offer and plans to deepen its roots here, “he said.

It also represents a victory for New York mayor Bill de Blasio (D) and Gov. Andrew M. Cuomo (D), who had a joke that he would change his name to “Amazon Cuomo” if needed to land the project.

Other finalists included District, Montgomery County and 16 other jurisdictions Amazon then watched the list decrease in January. Mayor, D.C. Muriel E. Bowser (D) and Maryland Gov. Larry Hogan (R) both accepted the message.

Neither does the pony need incentives for the company, but experts say both should see financial gains as a result. Bowser urged regional leaders to create concrete housing goals at reasonable prices – an acute problem that economists say are likely to worsen when Amazon grows.

“Amazon in Arlington is a profit for D.C.”, says Bowser in a statement. “We will continue to prepare residents with the skills and skills they need for future jobs, including in Amazon.”

Hogan said that he expects other companies to move to the region to be close to Amazon. “In summary, we will not only have 25,000 business levels, but also many companies that are part of the Amazon supply chain,” said Hogan.

AOL founder Steve Case, who now works with technology companies in smaller cities, issued a statement that encourages them not to lose faith despite the election of two East Coastal Warts.

“The best economic strategy is not to attract existing companies to open offices or factories, but instead to feed the new companies that may be the Amazon,” he said. But in the same breath, the long-lasting northern Virginia resident took a victory top: “Amazon’s announcement is a winner not only for VA but also for the entire major DC region.”

Resistance to the move began shortly after the announcement, as groups engaged in combating inequality and opposing corporate contributions began rallying their supporters in both New York and Virginia when the details of the store began to appear.

“We have called and repeated from Queens residents all day about this. Society’s answer? Rebellion, says republic-elected Alexandria Ocasio-Cortez (DN.Y.), who will take office in January.

Many were worried about living costs and questioned why a company operated by Bezos – the richest person in the world – needed public funds.

It’s “unusual for us to sign a $ 3 billion check to Amazon”, claimed New York Sen. Michael Gianaris and Jimmy Van Bramer City Council, especially in view of the city’s crumbling subways, crowded schools and inadequate health care.

“We witness a cynical game where Amazon drives New York to offer unprecedented amounts of tax quotas to one of the richest companies on earth for a promise of jobs that would represent less than 3 percent of jobs usually created in our city over a 10-year period, “they wrote in a statement.

But Cuomo said the benefits dwarf the subsidies.

“The sales ratio is 9 to 1. It is the highest return on an eco-incentive program that the state has ever offered,” said Cuomo. He opposed it with the return of the state film tax credit, where he said that the state received $ 1.15 for every $ 1 it invests.

Similar concerns were expressed in Virginia.

“Thousands of new paying jobs can be a boon to our society, but we deserve to know the cost,” said Anna Scholl, Executive Vice President of Progress Virginia. “Thousands of new workers and their families will certainly suffer from social resources in terms of affordable housing, mass transit and traffic, and local quality schools. It’s only right that Amazon pays its fair share.”

Jay Carney, Amazon’s vice president of world-wide business community, said that the company carefully looked at all sites and reviewed 100 different metrics but finally made its decision – including the choice to split the project – based on how best the company could recruit the talent needed.

“We realized that of course there are two amazing metropolitan areas and each of the areas has an existing pool of talent and are great places to live,” he said in a telephone conversation.

Carney said that Amazon would apply some of the lessons it learned from its growth in Seattle to its new places. He said that Bezos was “involved very deeply” in the process and was in every leadership meeting where it was discussed.

Amazon’s decision to divide the project instead of opening a second headquarters in line with its campus in Seattle has regretted some who said that the company had only strengthened the competition among the cities to change the rules in the middle. Some said it was unfair that the company seemed to consider only websites in more prosperous communities.

“A thing different here is that we plan in advance with these cities. Amazon started in a garage. No one predicted, not even Jeff, when they announced that Amazon would be what it became or that we would have tens of thousands of employees in Seattle alone, said Carney.

Amazon launched the project in the fall of 2017, dubbed the HQ2 and issued search criteria for “a second-party headquarters” with as many as 50,000 jobs and an investment of $ 5 billion.

When choosing Crystal City chose Amazon to choose a nearby suburban area, just across the Potomac River from Washington and half a mile from the National Airport. Outdated buildings and under-utilized real estate now fill the site where some office buildings have given vacancies.

The selection represents a triumph of the Arlington growth strategy and Alexandria to promote the development of mass transit leaders. The site is located near the Crys subway station tal City on the blue and yellow lines and the planned Potomac Yard station is scheduled to open in 2021.

But living in the nearby Del Ray area of ​​Alexandria expressed concern earlier this year that Amazonian arrival would worsen daily rush hour copies that were already slow traffic to a creep and would wipe out the quality of life in their neighborhood of mostly single-family houses.

The decision marks a dramatic rise in fortune for Crystal City, which lost thousands of jobs when military agencies and defense contractors resigned in Pentagon’s defense-based closure and redevelopment commission, which began in 2005.

One advantage is that the properties are monitored by a single, Well-Capitalized Company, JBG Smith. The $ 4.4 billion company is the region’s largest property owner and most active developer and owns a majority of the property in the bid – enough to accommodate the entire project in Crystal City and Potomac Yard.

Amazon also chooses Burnishes Northern Virginia stands as an attractive place for corporate headquarters. Over the last 15 years, the Volkswagen Group of America has been fooling Herndon, Northrop Grumman to Falls Church, Hilton Worldwide to Tyson and Nestles US headquarters to Arlington.

Northam said in March that the state’s pitch was centered on labor development, including and transport, along with quality of life.

Although 238 sites originally submitted proposals for Amazon, many experts considered the Washington area a favorite initially because of Bezo’s personal connections in the region, especially the $ 23 million he bought in the Kalorama area last year and his ownership of sent.

Others suggested that Amazon bosses wanted to be close to Washington to be cozy up to federal government either due to increased concern that regulatory authorities could run anti-trust measures against the company or because the government has become a critical Amazon customer.

Virginia also offers the political advantage

Amazon announced earlier that it would be the headquarters of its cloud computing device, Amazon Web Services, in Herndon, near some of its data centers. [19659052] The Washington area also naturally fits many of the criteria Amazon required in its search, including a deep pool of talented workers, a robust public transport system and easy access to the airport.

Amazon launched its search in September 2017, vowing to make a decision by the end of 2018 and occupies a first building of 500,000 square feet in 2019.

The company says that its headquarters in Seattle have injected $ 38 billion in excess of what the company spent on its buildings in the area’s economy and generated an additional $ 1.40 for each dollar that the company spent.

Seattle officials have not questioned the numbers, but they have also competed to keep up with the company’s staggering growth and the demands it imposes on public transport, schools, road networks, parks and utilities. The company now has over 45,000 employees, occupying more than 40 buildings and 10 million square meters of office space.

Compared with other major companies, Amazon employees are less likely to commute by car, as about 55 percent either go bicycles or take public transport, according to a survey conducted by the Seattle staff. The company buys employee transit tickets and builds its own bike track to separate bicycles from cars near Seattle buildings.

Amazon growth is likely to add new tribes to housing. Since the arrival of Amazon, Seattle has become one of the most expensive places in the United States to live and force low-income residents to move to remote suburbs. The city and surrounding King County declared an emergency in 2015 over homelessness.

Even without Amazon, the Metropolitan Washington Government Council estimated that the region must add 235,000 housing units by 2025 to keep up with expected employment growth. Amazon’s arrival could drive the target of 267,000, according to a recent analysis by the Urban Institute. Right now, it is about to add about 170,000 new units before 2026.

Since its inception, Bezos and the company have made several messages that could ease Amazon’s image when it comes to opening its second hub.

Bezos announced in September that he would donate $ 2 billion of his own money to support groups fighting homelessness in America and to create a network of preschools in underestimated communities. In October – after saving months of criticism from late Bernie Sanders (I-Vt.) Over his treatment of workers – Amazon announced that it would raise its minimum wage for all employees at $ 15 per hour.

The minimum wage decision is unlikely to have a major impact on the company’s employment in northern Virginia, where Amazon says its facility will mainly employ officials with an average salary of more than $ 100,000 a year.

Before Amazon announced its search, Washington area jurisdictions – forced partly by federal budget cuts – had already diversified their workers away from a dependence on federal spending. The region received more than 55,000 jobs annually from 2015 to 2017 despite budget cuts and stagnation in the congress. However, its employment growth has been slower than the average among major metropolitan areas.

Patricia Sullivan, Gregory S. Schneider, Michael Laris and Fenit Nirappil contributed to this report.

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