By Casey Coombs and Michael Neibauer posted November 13th, 2018 on bizjournals.com
Crystal City, the future home of Amazon’s second headquarters, is a section of Arlington County on the Potomac River directly across from Washington, D.C. Route 1, also known as Jefferson Davis Highway, runs through Crystal City, home to office buildings, hotels and residential complexes. The… more
Crystal City (rebranded in Amazon’s press release as “National Landing”) and Long Island City in Queens will each ultimately get more than 25,000 Amazon employees as part of the deal.
In addition, Amazon announced it selected Nashville for a new Center of Excellence for its Operations business, which is responsible for the company’s transportation, supply chain and other activities. That site will receive 5,000 jobs.
The winner in Greater Washington is an area known as Crystal City, an urban location just across the Potomac River from D.C. that is largely controlled by a single owner, JBG Smith Properties (NYSE: JBGS).
Crystal City is located within Arlington County — home of the Pentagon and Reagan National Airport — and was one of a handful Greater Washington locations vying for the most anticipated economic development prize in a generation.
“We are excited to build new headquarters in New York City and Northern Virginia,” said Jeff Bezos, founder and CEO of Amazon, said in a statement. “These two locations will allow us to attract world-class talent that will help us to continue inventing for customers for years to come. The team did a great job selecting these sites, and we look forward to becoming an even bigger part of these communities.”
The e-commerce giant narrowed the pool of 238 candidates across North America to a list of 20 cities in the U.S. and Canada in January.
Amazon said it plans to hire new teams and executives at the second headquarters and will let senior executives decide whether to locate their teams in Seattle or the new headquarters sites.
While Amazon’s billions in planned investments and thousands of employees will be an economic boon for Northern Virginia, New York and Nashville, it won’t come without costs.
Amazon’s growth in Seattle has fueled office construction and spurred jobs in a variety of sectors serving the tech company’s high-paid employees, but the rapid growth has come at the expense of soaring home prices, increased commercial and residential rents and worsening traffic congestion.
Online real estate listing marketplace Zillow Group Inc. projects rents in the HQ2 winners to increase only modestly due to Amazon’s HQ2, especially considering the jobs will be added in two of the nation’s largest and most affluent metropolitan areas.
Amazon has increasingly wielded its influence in Seattle, threatening in May to scale back its expansion in the city pending a city council vote on a proposed business tax on large employers to fund homelessness services and affordable housing. Amazon’s opposition helped weaken the version of the bill that eventually passed. The Seattle-based retailer then pledged $25,000 to an anti-tax campaign that led to the repeal of the law.
The company has separately negotiated more than $1.24 billion in subsidies from state and local governments to build out its increasingly automated fulfillment and delivery network, a Business Journal analysis found.
Amazon applied the same hardball negotiation tactics in eliciting financial incentives from HQ2 finalists.