Amazon narrowed the field in its search for a city for its second headquarters, or HQ2, plucking 20 finalists from among the 238 proposals it received. Only one West Coast city made the cut.
Amazon on Thursday narrowed the field in its search for a second headquarters city, plucking 20 finalists from the 238 proposals the retail giant received in October.
The list includes several cities widely seen as favorites — Atlanta; Austin, Texas; and Boston — as well as dark-horse candidates Columbus, Ohio; Indianapolis; and Nashville.
The company has said it plans to make a final decision on what it calls HQ2 sometime this year and could occupy the first portion of a new campus as soon as next year.
Amazon surprised the world, and its Seattle hometown, in September when it announced it was looking for a second headquarters city somewhere in North America, which CEO Jeff Bezos said would be a “full equal” to its massive existing campus. The online retail giant said it could spend $5 billion, and hire as many as 50,000 employees, at the campus over an up-to-17-year build out.
Many observers viewed Amazon’s search as a sign that the company’s ambitions had outgrown Seattle, and that it would most likely seek a different labor force outside the Pacific Northwest. A handful of municipalities in the area — including Tacoma, Spokane, Portland and a consortium of King and Snohomish County cities — raised their hands anyway. None made it through the first round of cuts.
Los Angeles is the only West Coast representative on the shortlist, a group of mostly large cities along the Eastern Seaboard and Rust Belt.
The 20 finalists are Atlanta; Austin, Texas; Boston; Chicago; Columbus, Ohio; Dallas; Denver; Indianapolis; Los Angeles; Miami; Montgomery County, Maryland; Nashville; Newark, N.J.; New York; Northern Virginia; Philadelphia; Pittsburgh; Raleigh, N.C.; Toronto; and Washington, D.C.
Some outside observers were surprised at how many places remain in contention for Amazon’s headquarters. Typically, companies seeking a location for a major project will set their sights on three to five candidates for final interviews and site visits, according to consultants who advise them.
“Twenty is a lot,” said Jim Renzas, a corporate location consultant based in southern California. “Of course, they had to eliminate a lot of cities. They started with 238.”
The initial announcement of the HQ2 search set off a frenzy among elected officials and corporate recruitment shops across the U.S., with dozens of municipalities immediately announcing their interest. Some would jockey for position with gifts, publicity stunts and earnest appeals on how unique their city was.
The company’s public wish list for its second home included proximity to a population center of more than 1 million people, a nearby international airport, access to mass transit, and a business-friendly environment and tax structure.
A request for tax breaks or other incentives, detailed in the company’s request for proposals, drew criticism from watchdog and labor groups critical of what they see as unnecessary giveaways of public money to private corporations. Newark appeared to set the high water mark among those who have disclosed their offers to Amazon, promising $7 billion in state and local tax credits.
Newark Mayor Ras Baraka learned his city had made the cut in a text message from U.S. Sen. Cory Booker, who, along with former Gov. Chris Christie, championed New Jersey’s bid.
“I was excited, obviously,” Baraka said in an interview. “I thought we had a legitimate chance,” he said. “We have all of the opportunity and the market that New York City has, but not any of the constraints of being in that space.”
Of the tax breaks, he said “we had to show Amazon that we’re serious.”
Some cities that decided to apply fell short of Amazon’s criteria. The company didn’t appear to discourage anyone from bidding, however. Representatives of several cities that approached Amazon said the company’s message was to submit a bid, regardless of their assessment of their odds.
Bids were due Oct. 19 and stacked up in the company’s headquarters building. They came from 43 states, the District of Columbia, Puerto Rico, as well as cities in seven Canadian provinces and three Mexican states.
A team of Amazon employees representing business units and corporate functions, such as legal and human resources, got to work compiling data to help evaluate the bids.
Inside Amazon’s South Lake Union campus, meanwhile, some whiteboards in common spaces became office pools on the outcome, and included at least a few pleas (“Anywhere but Phoenix,” opined one Amazonian whose wish was granted Thursday).
“Getting from 238 to 20 was very tough – all the proposals showed tremendous enthusiasm and creativity,” Holly Sullivan, director of Amazon’s in-house economic development group, said in a statement. She added that Amazon would consider some of the applicants as locations for other projects.
Amazon said it would work with cities in the coming month to “dive deeper into their proposals, request additional information, and evaluate the feasibility of a future partnership that can accommodate the company’s hiring plans as well as benefit its employees and the local community.”
It’s not the first time that Barry Broome – who leads the economic development group in Sacramento, cut from the HQ2 competition – has been on the outside looking in after a civic bidding war.
When Tesla was seeking land for a major project a few years ago, California’s capitol made a hard push for the project, earning a meeting with Elon Musk, the automaker’s founder. Tesla wound up picking Reno, Nevada.
Broome knew Sacramento wasn’t a leading candidate for HQ2, but hoped the city’s pitch could clear the first hurdle and open the door to making the case in person with Amazon.
It wasn’t to be, he learned early Thursday.
“You drink your own Kool-Aid a bit when you get into these competitions,” he said. “But we think our community should have been on the shortlist. I’m sure I’m not the only economic developer thinking that way today.”