The rumors were true. In an official statement (over a year after the contest was announced), Amazon declared that its second headquarters will be split between two winning cities: New York City and Arlington, Va. Amazon will be investing $5 billion to create over 50,000 jobs for these two locations, both of which made the Top 20 list.
Arlington and Long Island City will each benefit from over 25,000 full-time, high-paying jobs (with an average salary of $150,000); an estimated $2.5 billion in Amazon investment; 4 million square feet of energy-efficient office space (with the opportunity to expand to 8 million square feet); and an incremental tax revenue of approximately $10 billion over the next 20 years due to Amazon’s investment and job creation.
“We are excited to build new headquarters in New York City and Northern Virginia,” said Jeff Bezos, founder and CEO of Amazon. “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.”
New York City
This headquarters will be placed in the Long Island City neighborhood of Queens. Amazon chose it for its mixed-use community, an intersection of the arts and industry and a uniquely diverse blend of cultural institutions, arts organizations, new and converted housing, and restaurants and bars, as well as both small and large tech sectors. Additionally, transportation played a significant role in Amazon’s decision—Long Island City touts eight subway lines, 13 bus lines, a commuter rail, a bike-sharing service, ferries and two major airports in close vicinity.
Incentives*
Amazon is due to receive performance-based direct incentives of $1.525 billion and a refundable tax credit through New York State’s Excelsior Program. Additionally, a cash grant from Empire State Development of $325 million based on the square footage of buildings occupied in the next 10 years.
“When I took office, I said we would build a new New York State—one that is fiscally responsible and fosters a business climate that is attractive to growing companies and the industries of tomorrow,” said New York Governor Andrew M. Cuomo in a statement. “We’ve delivered on those promises and more, and today, with Amazon committing to expand its headquarters in Long Island City, New York can proudly say that we have attracted one of the largest, most competitive economic development investments in U.S. history. With an average salary of $150,000 per year for the tens of thousands of new jobs Amazon is creating in Queens, economic opportunity and investment will flourish for the entire region. Amazon understands that New York has everything the company needs to continue its growth. The state’s more than $100 billion transportation infrastructure program—the most ambitious in our history—combined with our education initiatives, like K-12 tech education and the first-in-the-nation Excelsior Scholarship program, will help ensure long-term success and an unrivaled talent pool for Amazon.”
“This is a giant step on our path to building an economy in New York City that leaves no one behind. We are thrilled that Amazon has selected New York City for its new headquarters,” said Bill de Blasio, mayor of New York City, in a statement. “New Yorkers will get tens of thousands of new, good-paying jobs, and Amazon will get the best talent anywhere in the world. We’re going to use this opportunity to open up good careers in tech to thousands of people looking for their foothold in the new economy, including those in city colleges and public housing. The city and state are working closely together to make sure Amazon’s expansion is planned smartly, and to ensure this fast-growing neighborhood has the transportation, schools and infrastructure it needs.”
Arlington
In the Arlington area, Amazon’s headquarters will be located at National Landing, an urban community just three miles from Downtown Washington, D.C., a location picked for its easy commuter rail access and proximity to Reagan National Airport, as well as abundant cultural events and downtown amenities, such as hotels, restaurants, high-rise apartments and retail and commercial offices.
Incentives*
Amazon will receive performance-based direct incentives of $573 million, a workforce cash grant from the Commonwealth of Virginia of up to $550 million, and a cash grant from Arlington of $23 million over 15 years.
“This is a big win for Virginia—I’m proud Amazon recognizes the tremendous assets the Commonwealth has to offer and plans to deepen its roots here,” said Virginia Governor Ralph Northam in a statement. “Virginia put together a proposal for Amazon that we believe represents a new model of economic development for the 21st century, and I’m excited to say that our innovative approach was successful. The majority of Virginia’s partnership proposal consists of investments in our education and transportation infrastructure that will bolster the features that make Virginia so attractive: a strong and talented workforce, a stable and competitive business climate, and a world-class higher education system.”
“We are proud that Amazon has selected National Landing for a major new headquarters.” said Arlington County Board Chair Katie Cristol in a statement. “This is, above all, a validation of our community’s commitment to sustainability, transit-oriented development, affordable housing and diversity. The strength of our workforce coupled with our proximity to the nation’s capital makes us an attractive business location. But Arlington’s real strength is the decades of planning that have produced one of the most vibrant, civically engaged communities in the world. Those plans have paved the way for this investment, and we look forward to engaging the Arlington community about Amazon’s plans and how we can grow together.”
Here’s What the Industry Is Saying
“The city and state of New York have committed to the improvement of infrastructure and transportation to facilitate this move. With the recent gentrification and because Manhattan is just one subway stop away, HQ2 ultimately makes sense in the Long Island City.” – Evan Metalios, Broker, RE/MAX TEAM, Jackson Heights, N.Y.
“Long Island City has been working to turn the area from a pure manufacturing town to a vibrant area with residential housing over the past 25 years. This is a big positive in NYC—the community is ready to adapt and make it even better than it is now. I think it will grow the need for jobs and housing, but I don’t think it’s too many people coming in. It will make it a more vibrant place to live and even help the surrounding areas, such as the Bronx, in facilitating jobs.” – Robb Saar, Broker and Office Advisor, Engel & Völkers New York City
“Amazon HQ2 coming to Northern Virginia will have a very positive impact the city’s residents. Amazon is spending around $2 billion to establish this headquarters, so this will greatly bolster our economy. Not only will this bring new jobs, but it will also impact other industries, including construction and real estate, in positive ways.” – Sherry Rahnama, Owner, RE/MAX Executives, Springfield, Va.
“I do not think this will have much impact on my market, as we are across the river. Just like a change in the administration, there are some sales, probably more rentals, but it will not be monumental to the real estate market in Northern Virginia. I think a lot of the hires will be local and the others who come here will spread themselves out between D.C., Virginia and a bit in Maryland. I certainly do not see this increasing prices in our area.” – Melinda Estridge, Founder, The Estridge Group, a Long & Foster Company, Md.
*These incentives will only be fulfilled if Amazon can meet the job growth and profit goals it has set for each headquarters. For more information, go to Amazon’s blog.
Stay tuned to RISMedia for more developments.
Liz Dominguez is RISMedia’s associate content editor. Email her your real estate news ideas at ldominguez@rismedia.com. For the latest real estate news and trends, bookmark RISMedia.com.
