Cities from Bellevue to Spokane to Vancouver say they are working on proposals to attract the online retailer’s second headquarters, even though corporate location consultants think Washington state faces long odds.
As Amazon scours the country for a second home, its first would like a word.
Washington cities from Bellevue to Spokane to Vancouver say they are working on proposals to attract the online retailer’s second headquarters, a multidecade, $5 billion expansion that may lead to a corporate campus of 50,000 workers.
Three weeks before Amazon’s deadline for interested bidders to submit their paperwork, those proposals are still taking shape.
Whether Amazon would seriously consider any of them remains to be seen.
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Amazon’s public request for proposals doesn’t detail why the company decided to open up a search for an HQ2 rather than continue to expand closer to its Seattle headquarters.
But outside observers have interpreted Amazon’s unusual public request as evidence that the company believes it needs to expand beyond the borders of Seattle, and, in all likelihood, Washington state. Amazon today is the largest employer in Seattle, with about 41,000 employees, up from about 5,000 in 2010.
“I think they’re looking for a different state to hedge their bets,” said Jim Renzas, a longtime corporate-relocation consultant with RSH Group.
Washington state is undeterred.
The Bellevue City Council asked city officials to evaluate Amazon’s proposal. Snohomish and Pierce counties’ officials say they will make bids for Everett, Tacoma and other cities. Spokane is interested. Vancouver is said to be evaluating a bid with Portland.
Gov. Jay Inslee said in an interview that Amazon policy chief and former White House spokesman Jay Carney had told him the company would at least consider Washington bids. “They’re telling us that they will take a look,” he said.
Amazon, quiet on the matter since its surprise announcement Sept. 7, declined to comment beyond its public request for proposals.
At least 137 cities, states and Canadian provinces have indicated their interest in luring Amazon’s megaproject. Many of them don’t meet Amazon’s criteria, which include access to an international airport and a metropolitan population of more than 1 million.
Some longshot candidates, site-selection experts say, may be bidding just to show their constituents they made an effort for the biggest corporate development project in memory. And some cities that admit they’re longshots say there’s no downside to applying and currying favor with America’s fastest-growing company.
Complicating matters for bidders, but simplifying them for Amazon, is a line near the top of the company’s document. Amazon invites bids, it says, “in conjunction with and on behalf of your metropolitan statistical area.”
Seattle’s metropolitan area includes King, Pierce and Snohomish counties, home to at least four interested bidders.
“Amazon expects a regional proposal,” said Suzanne Dale Estey, who earlier this year stepped down as president of the Economic Development Council of Seattle and King County. “To have eight proposals from the Seattle region is not going to bode well.”
City and county economic-development officials — the public sector and semigovernmental workers charged with recruiting companies to the region — have been holding conference calls to line up their efforts, but no clear single plan has emerged yet.
King County Executive Dow Constantine is leading the response that will include Seattle, Mayor Tim Burgess said, though the city may not submit its own site for Amazon’s consideration.
The company’s build out in the South Lake Union neighborhood, and its push toward Belltown and downtown, leave few obvious candidates for another massive Seattle campus.
Sodo is the biggest centrally located patch of low-density buildings, though if the Port of Seattle’s stiff resistance to a proposed Sodo sports arena is any indication, a corporate campus that further encroaches on the light-industrial corridor would be a tough sell.
The state is playing a supporting role, and it won’t be submitting its own bid or picking among Washington’s contenders.
“We love all our children equally, so to speak,” Inslee said.
One possible outcome, state officials say, is a single bid from the Seattle metropolitan area that’s actually composed of pitches from several cities. The handful of interested municipalities in the orbit of Washington, D.C., appear to be taking the same approach after early efforts at consolidating a single pitch failed.
Burgess said he hopes it doesn’t come to that, however. “My hope, and I think Dow shares this, is that the coordinated response will include King, Snohomish and Pierce County entities.”
For now, county officials are separately gathering data and looking for locations that could accommodate Amazon’s request for 500,000 square feet of space by 2019, and up to 8 million square feet years down the line.
Snohomish County is trying to tally the Amazon employees who already live in the county, with an eye toward a pitch that Amazon might make life easier for its long-distance commuters even as it tries to attract new recruits.
Bellevue officials have suggested Amazon consider the corridor that stretches east from downtown Bellevue across Interstate 405.
And Pierce County economic-development workers are drafting a bid anchored to downtown Tacoma.
“Any community that wants to land this has got to find out where it would go,” said Bruce Kendall, president of the Economic Development Board for Tacoma and Pierce County. “That’s what everybody is trying to do right now.”
Not everyone is raising their hands. Federal Way, still seeking an anchor tenant for the former Weyerhaeuser corporate campus, opted not to advance a bid. Tim Johnson, the city’s economic-development manager, is convinced Amazon has its sights set elsewhere.
“We’re the same labor force,” he said. “If it was just a real-estate play, we would have done it. I think it’s [about] talent, and I think it’s money.”
Corporate-location consultants also think the state faces long odds. A second headquarters in Spokane or Tacoma would leave Amazon with the same labor pool: people located in, or willing to move to, the Pacific Northwest.
Brian Bonlender, director of Washington’s Department of Commerce, doesn’t believe that’s a deal-breaker.
“I don’t think it’s a fatal weakness,” he said. “If Amazon can see a clear path where they can grow, and they’re wanted, and it works for their business model, I think we have a shot.”
There is another component of Amazon’s request that may limit the state’s chances.
The company’s proposal is explicit that tax breaks and other corporate development incentives will be “significant factors” in the decision. Corporate location brokers expect the company will receive some incentive packages valued at more than $1 billion.
Washington’s constitution bars the state from using the public purse to give the kind of upfront grants and other payouts relocating companies routinely ask for.
The state has other tools, though. The cut to the aerospace business and occupation tax rate that the Legislature enacted in 2013 to land work on the Boeing 777X stands as the biggest corporate subsidy in American history.
More often the Puget Sound region tends to compete on its good looks, hoping access to natural amenities and a relatively well-educated workforce will lure and keep companies.
“We do not hand out cash; it’s illegal here,” said Dale Estey, the former King County development official. “It’s a very different ballgame. That has sometimes caused us to be complacent.”