Amazon second headquarters list of finalists

-- "Here’s how cities are reacting to being finalists for Amazon HQ2," CNBC

See the past blog entry, "The Amazon second headquarters "****show": Part 1 | Where could it go?"

Sadly, Baltimore and Detroit didn't make the list, and landing this "whale" would have been an economic game changer for those communities.  Although Newark is on the list, and Philadelphia.


The finalists:

• Atlanta, Georgia
• Austin, Texas
• Boston, Massachusetts
• Chicago, Illinois
• Columbus, Ohio
• Dallas, Texas
• Denver, Colorado
• Indianapolis, Indiana
• Los Angeles, California
• Miami, Florida
• Montgomery County, Maryland
• Nashville, Tennessee
• Newark, New Jersey
• New York City, New York
• Northern Virginia, Virginia
• Philadelphia, Pennsylvania
• Pittsburgh, Pennsylvania
• Raleigh, North Carolina
• Toronto, Ontario
• Washington, D.C.

The issue to me comes down to maybe 3-4 criteria:

1.  Economic nationalism.  While Toronto makes a great argument, and national health insurance means huge savings for companies in Canada, I think that were Amazon to locate a new headquarters outside the US they would invite serious attacks from the current administration/federal government, especially because Amazon's founder owns the Washington Post, which President Trump sees as an opponent.

2.  The cost of housing for employees.  Many of the cities making the cut--Boston, DC/Northern Virginia/Montgomery County, New York City--have high housing costs and a small increase in demand could make an already frothy market that much more turbulent comparable to what is happening in Seattle and San Francisco now.

Since part of the reason for Amazon to build a second headquarters is to provide employees with more reasonably priced housing options, I can't see a high housing cost city being chosen in the end.  

3.  Proximity to higher education institutions with leading programs in information technology, engineering, and business.  To be honest, I think that dings the DC area, Indianapolis, and Nashville.

It should make us appreciate former Mayor Bloomberg's initiative to create a world-class engineering and technology graduate school in New York City to better develop and attract business ("New York's Silicon Alley Is (Still) No Match for Silicon Valley," Bloomberg).
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4. Transit/Urbanism/Placemaking/Quality of Life.  I would think this factor would eliminate cities like Dallas and Atlanta and Denver, although they have transit systems.  And even Northern Virginia because the sites proposed to Amazon aren't "close in" to the center, but more distant locations that would be termed suburban, almost exurban.

Not sure how to handicap Los Angeles.  It's cool, but the housing market has rebounded and Western Los Angeles City and County doesn't have low cost housing.

I think it might give Montgomery County, Maryland a boost because of the ability to do some large developments along the Red Line, even to extend the Green Line out New Hampshire Avenue as I've suggested in the past.  There's enough room around the FDA campus there, but it isn't particularly dense and urban.

There is opportunity in Silver Spring, especially given that Discovery Channel will be leaving, but to put the Amazon project in perspective, Discovery has one big building capable of supporting 2,500 workers and Amazon is demanding the capacity for 20 buildings of that size...

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Comments

WRT DC's bid ("DC discloses part of the Amazon HQ2 incentive package," Washington Business Journal, I was surprised to see such a huge incentive offered for each "veteran" to be employed.  I don't see why that would matter that much to DC specifically, compared to supporting DC business development and employment of residents.

WRT the likelihood of DC not being picked, I hope it will spur the city to take a deeper, harder look at the necessary antecedents for economic development and diversifying the local economy beyond its dependence on the federal government.

I think it means looking at DC's higher education institutions and figuring out how to up their game, along the lines of what Mayor Bloomberg started in NYC, collecting and publishing metrics on businesses developed out of DC universities and local research, etc.

See the past blog entry "Better leveraging higher education institutions in cities and counties: Greensboro; Spokane; Mesa; Phoenix; Montgomery County, Maryland; Washington, DC."

Where's the Catholic U research park? Along those lines, for more than a decade Catholic U has talked about creating a research park adjacent to their campus and they haven't done much of anything.

See the past blog entry, "Naturally occurring innovation districts | Technology districts and the tech sector".

Meanwhile, UMBC's business incubator keeps on generating new businesses ("UMBC eyes major expansion at research and technology park," Technical.ly Baltimore; "15 companies graduate from UMBC's bwtech, ready to grow on their own," Baltimore Business Journal).

Montgomery County, Maryland.  For all the hand-wringing about Montgomery County's competitiveness vis-à-vis Northern Virginia ("Montgomery County's real economic development problem: it's not part of the military economy," 2011 blog entry), Maryland's supposedly faulty business climate, and just announced decision of Discovery Channel to leave Silver Spring for New York City ("Discovery’s departure is ‘shot across the bow’ for Silver Spring, state and region," Washington Post) it says a lot that Montgomery County is a finalist.

Like DC, they need to look at this result in a very detailed way and figure out how to better leverage, strengthen, and market their competitive advantages.  (Personally, I don't think it's by outsourcing their economic development functions to the private sector, but that's me...)

My own belief: go for it.  It's worth aiming to recruit Amazon and to spend a fair amount of incentives to do it.  But recognize there will be some negative impacts to go along with the good.  See e.g., "Amazon has brought benefits - and disruption - to Seattle," AP and "How Amazon's Nonstop Growth Is Creating A Brand-New Seattle," Fast Company.