Northern Virginia makes the short list for Amazon HQ2
- January 18, 2018
Editor's Note: This story has been updated.
Northern Virginia made the short list of prospects for Amazon’s second $5 billion headquarters. Metropolitan Richmond and Hampton Roads, which also had pitched for the project, did not make the initial cut.
Washington, D.C., and Montgomery County, Md., are also on the short list, giving the metropolitan Washington area a total of three prospects, more than any other area of the country.
Amazon announced the list of 20 cities Thursday that will continue to be considered for a project that the company says will create 50,000 high-paying jobs over the next 15 to 17 years.
Amazon has said HQ2 would be a full equal to its 33-building headquarters in Seattle.
Virginia Gov. Ralph Northam welcomed the news. "We couldn’t be prouder that Northern Virginia has been selected as one of 20 candidate locations for this historic project,” he said in a statement. “The Commonwealth’s strong proposals for the Amazon HQ2 project represent an unprecedented level of local and regional collaboration, as well as strong support from Governor McAuliffe’s administration and leaders in the Virginia General Assembly. Virginia’s outstanding business climate and world-class workforce make our commonwealth the right place for Amazon to place this key base of operations."
Amazon reviewed 238 proposals from across the U.S., Canada, and Mexico. These are the following 20 metropolitan areas that will move to the next phase of the bidding process (in alphabetical order): Atlanta; Austin, Texas; Boston; Chicago; Columbus, Ohio; Dallas; Denver; Indianapolis; Los Angeles; Miami; Montgomery County, Md.; Nashville, Tenn.; Newark, N.J.; New York; Northern Virginia, Philadelphia; Pittsburgh; Raleigh, N.C.; Toronto; and Washington, D.C.
“Thank you to all 238 communities that submitted proposals. Getting from 238 to 20 was very tough — all the proposals showed tremendous enthusiasm and creativity,” Holly Sullivan, Amazon Public Policy, said in a statement. “Through this process we learned about many new communities across North America that we will consider as locations for future infrastructure investment and job creation.”
Amazon said it evaluated each of the proposals based on the criteria outlined in a request for proposal (RFP) to create the list of 20 HQ2 candidates. In the coming months, Amazon will work with each of the candidate locations to delve 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. Amazon expects to make a decision this year.
In its request for proposals released in September, Amazon said it would prefer metropolitan areas with more than one million people, access to mass transit, a stable and business-friendly environment and urban or suburban locations with the potential to attract and retain technical talent.
The company also said it would need an initial site requirement of 500,000 square feet with total build out for the headquarters expected to be 8 million square feet. Amazon made clear that it wanted the headquarters to be within 30 minutes of a city center and 45 minutes from an international airport.
Business leaders and economic development officials were giddy with the news that Northern Virginia had made the short list. The region’s official proposal included four sites in Alexandria, Arlington County, Fairfax County, and Loudoun County.
“This is excellent news for Northern Virginia and the commonwealth that we are recognized, along with many other great areas across the country, as a top place to grow and locate a business, particularly one as substantial and successful as Amazon,” said Michael Forehand, senior vice president, government and public affairs for the Northern Virginia Chamber of Commerce. Forehand says NoVa has all the things Amazon is looking for: “A great work force, a great educational system, both K-12 and higher education, and a tremendous transportation system that’s getting better consistently.”
Going forward, what the region needs to focus on to continue being a serious contender, Forehand added, is a dedicated funding for Metro. Business leaders have been meeting to address how to fix the region’s transit system, which has suffered from declining ridership and deteriorating infrastructure.
“That effort is currently taking place in Virginia, Maryland and D.C., and the business community is fully committed to getting that done,” said Forehand. “If we could, it would be a tremendous demonstration that leaders in Virginia are committed to one of Amazon’s key priorities spelled out in the RFP, access to reliable public transit.”
Asked if Northern Virginia and the state will feel pressure to kick in more generous incentives since the region is among a group of 20 finalists, Forehand said, “Obviously, the competition will be fierce among the final 20, and it’s important for Virginia to put its best foot forward.”
Bob Kettler, CEO of Kettler in McLean, a major developer of residential and multi-use properties in the Washington region, also was thrilled with the news. Kettler and the Meridian Group pitched one of their sites, The Boro at Tysons, although they offered it separately -- not as part of the state’s official bid. “This is wonderful news,” said Kettler. Tysons would make a good location for Amazon, he added, because of its access to a robust community of technology talent and the fact that it’s undergoing a transformation into a more urban, walkable environment that will add thousands of new housing units.
The two partners have 1.5 million square feet of office under construction at The Boro, which is adjacent to the Greensboro Metro Station. It will be part of a larger 4.2 million-square-foot, mixed-use project. Plus, Meridian already controls other office buildings and parking garages near that metro station, Kettler noted.
“We have a solution for housing, transit, workers … If you line us up and weigh all of their requirements, we have a pretty heavy weight,” Kettler said of his site, and Northern Virginia in general.
With the announcement of the short list, officials are now gearing up to work with Amazon in the next round. "We look forward to working with their team in this next round to convince them that our unrivaled sites, workforce, education system, and quality of life are the best fit for their planned growth," Stephanie Landrum, president and CEO of the Alexandria Economic Development Partnership, said in a statement.
“This is an exciting time for Virginia,” said Victor Hoskins, director of Arlington Economic Development. “The opportunity to showcase Northern Virginia’s incredible assets, from our top-notch workforce and unparalleled transportation access to our vast residential opportunities and proximity to the nation’s Capital, to Amazon’s top executives is truly a win for all of us, and it would be a win for all of us."
Gerald L. Gordon, president and CEO of the Fairfax County Economic Development Authority, noted that Amazon already has chosen Fairfax County for an East Coast campus of Amazon Web Services (AWS). "We are excited to learn that Northern Virginia made the list of candidate locations that Amazon will consider for HQ2,” Gordon said. “The Economic Development Authority and partners stand ready to demonstrate to the company why our combination of business and quality-of-life assets make this a great location for HQ2 in addition to the mission-critical services AWS provides to the private and public sectors.”
As part of the Northern Virginia proposal, Loudoun and Fairfax counties collaborated with developer Open-Rebees to submit the largest nondeveloped site on the Metro. It straddles Loudoun and Fairfax counties. Buddy Rizer, executive director of Loudoun Economic Development, explained in a statement that "the site Amazon is considering is near Loudoun's Data Center Alley — the largest and fastest-growing data center market in the world. It will be more than fitting for an internatinal e-commerce corporation of Amazon's stature to local its second headquarters here."
In Virginia, the state’s business recruiting agency, The Virginia Economic Development Partnership (VEDP), hired a consultant and assisted regions in making their pitches. However, VEDP has remained mum on the details of the pitches and incentives that may have been offered -- even in the face of freedom of information requests.
“The Virginia Economic Development Partnership looks forward to continued collaboration with our partners in Northern Virginia, Gov. Northam’s administration, and leaders in the Virginia General Assembly as the process moves forward. Virginia’s proposals for Amazon HQ2 contain proprietary information, reflect negotiation positions on future contracts, and contain strategies for targeting future large economic development opportunities. For competitive reasons and to protect confidential company information, we cannot provide further details at this time,” the agency said when asked for comment Thursday.
Other localities were more forthcoming about their incentive packages. The Washington Business Journal has reported that D.C.’s package includes property and sales tax exemptions, relocation reimbursements of up to $7,500 per worker for people moving to D.C., and wage reimbursements of up to $30,000 per new job filled locally by a military veteran.
After hearing that Montgomery County had made the cut, Maryland Gov. Larry Hogan released a statement Thursday posted to his website saying, “This is tremendous news for Montgomery County, our entire state, and further proof that Maryland is truly open for business. Maryland put forward an extremely strong group of sites that were all supported by the state with incentive packages totaling more than $5 billion, including road and transit improvements."
In addition to Amazon’s direct hiring and investment, construction and ongoing operation, HQ2 is expected to create tens of billions of dollars in additional investment in the surrounding community. On its website, Amazon estimates that its investments in Seattle from 2010 through 2016 resulted in an additional $38 billion to that region's economy.
The world's largest online retailer, Amazon has more than 540,000 employees worldwide. It already has several facilities in Virginia, including two major distribution centers in central Virginia and data centers in Northern Virginia. Last year, Amazon Web Services announced that it would build an East Coast campus in Herndon, creating 1,500 jobs.
Over the past five years, Amazon said it has invested more than $100 billion in the U.S., including corporate offices, development and research centers, fulfillment infrastructure, and compensation to its teams.