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They may have determining factors that eventually rule locations out, but I think the final selection will be based on a wide combination of factors. There are also many site specific considerations that will be weighed.
I think Raleigh is probably still on the list because the Spring Hill tract is such a unique site. It's on the NCSU Centennial campus, adjacent to the train station, the BRT line that was recently funded, and also next to one of the largest urban park projects in the country. Add in cost of living, lower development costs, lower taxes, less traffic and the proximity to RTP and you have a decent case for an HQ2 site.
Just as I'm sure there are intangibles and strengths/weaknesses at all of the final 20. I don't think it's going to come down to this City has the most workers, this City has the best culture, or this one has the best transit. The amount of Due Diligence going into this is enormous. I would expect them to have full design studies for each of the available sites before they announce the selection.
Bingo! This is exactly how a site selection process plays out for a project of this magnitude. It's naive to think that a decision will be made solely based on metrics around cost of living, the size of a city, transit options, population of tech resources, etc. Of course these things will factor into the decision, but there are also other factors that may not have even been disclosed publicly that Amazon is considering. I suspect that the former criteria have already been heavily weighed in selecting the 20 finalist, and now Amazon is taking a deeper dive and looking at details such as local taxes, development costs, housing stock and traffic patterns around preferred sites, future development plans/proposals, political environment, and a number of other details for each of these 20 finalist cities.
It's clear that Amazon is doing its due diligence in evaluation of sites at the 20 finalist cities. Ultimately, they are looking for the best place possible to grow their brand and reduce costs.
Low cost may be a differentiator, but how is it weighted by Amazon? If low cost was the most important factor for Amazon, locations in the NE and West Coast wouldn't be in the final list. It's not difficult to find cost-of-living rates statistics. It wouldn't have been an easy choice for Amazon to simply pick the lowest cost location.
I think people need to keep focused on what location can server Amazon's future business needs such as pharmaceuticals, etc. Not just low-cost of living or housing stock.
What areas can support where Amazon wants to be in 15 years in terms of new products and services? That area may not offer the cheapest housing costs, but gives Amazon what it needs to launch into its next endeavor.
No one knows how much amazon is putting weight into anything. You are completely right in what you said, but the competitive advantage Raleigh brings, according to WRAL article, is lower cost. Atlanta is low cost and much more workers & mass transit. Washington is the capitol, transit, huge metro. Etc I’m sure most of the cities have certain advantages.
A good read on all the cities excluding Washington & Toronto as they are using states in their criteria: https://www.cnbc.com/2018/07/05/new-...azons-hq2.html the plus is Raleigh’s education; the bad news is NC’s education and Raleigh would have to pull from more than its metro for workforce.
Last edited by Charlotte485; 07-10-2018 at 10:49 AM..
Atlanta might be more workers, but they RTP probably has a much higher concentration of highly-skilled IT professionals.
Also note that Microsoft just announced that they are building an innovation center for their work with Duke researchers. All signs point to Raleigh continuing to be the go-to location for IT operations on the East Coast.
Atlanta might be more workers, but they RTP probably has a much higher concentration of highly-skilled IT professionals.
Also note that Microsoft just announced that they are building an innovation center for their work with Duke researchers. All signs point to Raleigh continuing to be the go-to location for IT operations on the East Coast.
No, not really. If you haven't been to Atlanta recently you wouldn't know. TONS of tech jobs moving in. (Look at Tech Square in midtown) Tech is really big in a lot of cities these days. That is the way the national economy is moving. Silicon valley is shifting more and more operations to cheaper areas. Atlanta dots all the "I's" and crosses all the "T's" in that aspect., just as does Raleigh, Charlotte, Dallas, etc.
No one knows how much amazon is putting weight into anything. You are completely right in what you said, but the competitive advantage Raleigh brings, according to WRAL article, is lower cost. Atlanta is low cost and much more workers & mass transit. Washington is the capitol, transit, huge metro. Etc I’m sure most of the cities have certain advantages.
A good read on all the cities excluding Washington & Toronto as they are using states in their criteria: https://www.cnbc.com/2018/07/05/new-...azons-hq2.html the plus is Raleigh’s education; the bad news is NC’s education and Raleigh would have to pull from more than its metro for workforce.
What makes you think that WRAL knows more than anyone else about the site selection process? Lower cost is low hanging fruit for an article meant to engage the local population and keep people interested. Most articles are going to have a slant with what they think is their local municipalities best attributes, but they're often misleading in the context of the larger project.
Take an article with the position that Raleigh is more affordable because it's $24/sf vs $41/sf lease rates in Washington. Since that's an average across the City, there are areas in Raleigh where you could see $28/sf and in DC where you could get to $36. You go from a $16 delta, down to $8, depending on the site. Those rates reflect construction costs and land costs, so the value is site specific. I also don't know if a company like Amazon would finance their own construction and own their own buildings, or if there is some less expensive land in DC that they could get. The final decision is likely going to be very site specific so the generalities about the individual Cities need to be taken with a grain of salt.
I said this early, but it's worth mentioning again. The size of the workforce is somewhat relevant, but for a company such as Amazon, the resources will be available, no matter where they go.
People across the country are going to be attracted to a job at Amazon, no matter where they land. As Amazon moves in and other businesses follow, the workforce they need will follow, as well.
What makes you think that WRAL knows more than anyone else about the site selection process? Lower cost is low hanging fruit for an article meant to engage the local population and keep people interested. Most articles are going to have a slant with what they think is their local municipalities best attributes, but they're often misleading in the context of the larger project.
Take an article with the position that Raleigh is more affordable because it's $24/sf vs $41/sf lease rates in Washington. Since that's an average across the City, there are areas in Raleigh where you could see $28/sf and in DC where you could get to $36. You go from a $16 delta, down to $8, depending on the site. Those rates reflect construction costs and land costs, so the value is site specific. I also don't know if a company like Amazon would finance their own construction and own their own buildings, or if there is some less expensive land in DC that they could get. The final decision is likely going to be very site specific so the generalities about the individual Cities need to be taken with a grain of salt.
Too many people are still stuck at step #1 of this process, while Amazon has already moved on to step #3 or #4. They are now focused on aspects of these 20 finalist cities that will help take their company to the next level and beyond. They have already picked finalist that have the tech workforce, that have adequate transit options, that have the needed educational assets.
Now they are focused on what sites will offer those intangibles that will make Amazon the e-commerce and business "king" that it truly wants to be. Some will say that this can only be done by locating in a city like New York, Boston, or Chicago, while others feel that it most definitely will be an Austin, Columbus, or Raleigh type of city. Only Amazon knows the answer to this. WRAL or any other media outlet doesn't.
but the competitive advantage Raleigh brings, according to WRAL article, is lower cost.
Assuming all other factors are equal. As you said, other cities have other advantages. Look at Silicon Valley. The housing costs are through the roof. That doesn't stop tech companies from locating there.
In Maryland, Discovery Communications HQ is moving from a DC Suburb to NYC. Costs would undoubtedly be higher in NYC. But NYC is a leader in communications and film/TV on the east coast. Discovery felt it was worth the higher cost to move there. Or else, I'd expect them to move to Atlanta, which is cheaper and has a respectable film/TV production industry itself.
It all depends on how much Amazon weighs certain factors.
Personally - I hope RDU lands Amazon HQ2. As a DC resident from RDU, I don’t want Amazon here. We’re good as is, have plenty of HQ’s, and the queen bee US Federal Givernment. Only thing Amazon is going to do for me is raise my property taxes. Not like I going to make more money at my job, and not planning on selling my home in the foreseeable future either.
But, sadly, I think there is now very strong speculation that Amazon has made their pick at the Dulles airport site. I say this because it was announced a couple of weeks ago that Amazon has purchased 107 acres of land that is next to the Dulles site. Said it was for another data center site after they just bought another site a coupe miles away for the same thing. Then a few days later it was leaked that the 107 acre site they purchased was indeed part of the state’s pitch and incentive package for HQ2, but they kept it a secret from the media at the time, only citing a portion of the pitch location apparently. When doing the math for development, 107 acres would accommodate 8m square feet perfectly under current zoning and density regulations. This begs the question of why would Amazon buy these 107 acres without the tax incentives associated with it being for HQ2 specifically? Why forfeit those benefits for two data centers, when there is absolutely no shortage of other nearby site locations for the data centers? I honestly don’t think they would. And why try keeping these 107 acres a secret from the HQ2 proposal released to the media?
I honestly hope I am wrong, truly. If it were up to me, HQ2 would be RDU, along with Apple!
But Amazon needs to be done with this process. What started as excitement is turning into frustration now for many involved. Owners and developers are sitting idle while waiting to see if they’re going to be doing this or not. This is getting stupid and risks backlash against Amazon if they don’t put this to bed SOON!
I honestly hope I am wrong, truly. If it were up to me, HQ2 would be RDU, along with Apple!
Well, Newark just sweetened their offer by adding $1 billion in payroll tax exemptions, which is on top of the $5 billion the state of New jersey already offered.
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