Amazon shortlists 20 metropolitan areas for new headquarters

Amazon displays its wares at the latest Consumer Electronic ShowImage copyright
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Amazon displays its wares at the latest Consumer Electronic Show

Amazon has released a shortlist of the 20 North American urban areas to be chosen to become the retailer’s second North American headquarters.

The proposed site is expected to cost more than $5bn (£3.6bn) and create 50,000 jobs. Cities across the US have placed bids for the contract.

“Getting from 238 to 20 was very tough,” the Seattle-based online shopping giant said in a statement.

Toronto was the only non-US city to make it to the list.

The others are 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; Northern Virginia; Philadelphia, Pennsylvania; Pittsburgh, Pennsylvania; Raleigh, North Carolina; and Washington DC.

A tale of 238 cities

Analysis by Natalie Sherman, BBC Business

Amazon’s announcement last fall that it would put roots down in a second city kicked off an unprecedented amount of jockeying among cities hoping for the nod.

The retail giant received more than 230 responses, including bids from places like Detroit, Michigan, Baltimore, Maryland and Camden, New Jersey, whose leaders hoped the promised 50,000 jobs and $5bn would remake their down-on-the-heels metropolises.

The shortlist revealed Thursday largely crushed that notion. Not so short, the 20 names read like a rundown of many of America’s most successful, wealthiest areas: New York City, Boston and a cluster of three around Washington DC, among them.

Even some of the more unexpected, smaller places, such as Nashville, Tennessee, and Pittsburgh, Pennsylvania, have gained reputations in the last decade as tech hubs.

Amazon was upfront about its preference for a big city, with a deep pool of potential workers, viable public transit and an international airport. But that didn’t necessarily take the sting out of the reminder that the gap between the regions of America that are thriving and those that are struggling is growing.

Amazon announced in September that they need a second headquarters, after they outgrew their Seattle hometown where the company was founded in 1994 and now employs more than 40,000 people.

In a press release, the tech giant said it had reviewed more than 200 proposals from across North America for its second headquarters.

A wave of local officials have wooed the company with tax incentives and other benefits.

Cities and counties engaged in publicity students to attract the company’s interest.

A development group in Calgary, Alberta, took out an advert in Seattle offering to fight a bear for Amazon.

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Chicago offered tax credits which would allow Amazon to keep over $1.3bn in income taxes that employees would normally pay to the state.

Miami Mayor Francis Suarez applauded the shortlist, writing on Twitter that “#Miami’s business-friendly environment and our highly-skilled, multilingual workers are ready for #AmazonHQ2.”

Washington DC Mayor Muriel Bowser called the decision proof that “Washington DC is no longer a one-company government town”.

Residents of other cities that failed to make the shortlist voiced their disappointment.

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In a statement, Detroit Mayor Mike Duggan said “we would love” to have been included on the shortlist, but that their proposal will continue to serve as “a clear vision for the future”.

“I expect the lessons we learned in the Amazon process will help make us more successful on a number of other major potential investments that we are currently pursuing.”

Others criticised the company’s list of demands, which include a business-friendly tax environment.

Stacy Mitchell, from the Institute for Local Self-Reliance, a group that advocates for local businesses, slammed the mega-corporation in a statement to the New York Times.

“As these cities woo and grovel, they are basically communicating this idea that we should want Amazon to be bigger and more powerful in our economy,” Ms Mitchell said of Thursday’s announcement.

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The company had previously said it would only consider metropolitan areas with one million residents or more.

Owned by Jeff Bezos, considered to be the richest man in the world, Amazon had recently bought up other companies including grocery chain Whole Foods, and the Washington Post newspaper.

A final decision is expected to come later this year.