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Amazon HQ2: Advanced Discussions on Second Headquarters in Northern Virginia

A man on a scooter along the 1
900 block of Crystal Drive in Arlington, October 19, 2018. (Astrid Riecken for the Washington Post)

Amazon.com has held advanced discussions about the possibility of opening its much sought-after second headquarters in Crystal City, including the speed with which employees move there, which buildings it would occupy, and an announcement about moving in public according to the close people.

The discussions were more in-depth than those regarding the company's other locations in Northern Virginia and some other cities at the national level and speculate that the Arlington County site is a pioneer to the second North American headquarters of online retail and its Land 50,000 jobs.

The Company Is So The decision that Crystal City's leading real estate developer, JBG Smith, has taken some of its leases out of the leasing market, was almost over, and representatives of the region have been discussing how they did one this month after the midterm elections Public and private sector officials may make public statements on condition of anonymity because Amazon has requested that the selection process remain confidential. The company could hold similar discussions with other finalists.

The 1900 Crystal Drive building was covered by a large, colorful tarpaulin on 19 October 2018 in Arlington. (Astrid Riecken for the Washington Post)

Two People Nearby The trial said that if Crystal City was selected, Amazon probably moved a first group of several hundred employees to the 1851 S. Bell Street or the 1770 Crystal Drive Two dated office buildings that were scheduled for refurbishment but could be prepared for occupancy by their owner, JBG Smith, in nine months or less. The offer also includes locations in Potomac Yard in Alexandria.

"There is a lot of activity," said a person close to the trial. The person added that people "look very positive and seem rather confident. , , What we do not know, maybe there are two or three other websites, and they do the same thing. This is scary for the people here.

At a conference in New York on Thursday, founder and CEO of Amazon, Jeffrey P. Bezos told the crowd : "Ultimately, the decision is made with intuition after a lot of data has been collected and studied. To the best of my knowledge, such a decision is the best way to achieve this by collecting as much data as possible. You dive into this data, but then you make the decision with your heart. (Bezos also owns The Washington Post)

Amazon spokespersons and JBG Smith declined to comment, as did Arlington County chairman Katie Cristol (D).

Alexandria Mayor Allison Silberberg (D) declined to discuss advanced talks but said: "We believe we have put forward a very competitive option and we are honored to be considered."

Virginia Gov. Ralph Northam (D), on WTOP Radio Wednesday, speculated that Crystal City was the frontrunner, saying, "Many of us are waiting eagerly for a decision, a message from Amazon. , , A lot of [Virginia government] resources are being spent right now, and I think, for a good reason.

A Northam spokesman declined to comment on Friday.

Excitement and Fear

After Launching a Reality Show – Like a raffle for a second home in late 2017, Amazon effectively blocked the search disclosure over the last nine months. Twenty finalist cities – many of whom have spent considerable time and money tracking the company – have little information about where they are, according to officials in four other finalist jurisdictions so-called HQ2 to land.

Washington leaders believe the project is theirs, and Virginia, Maryland, and the district would all benefit economically. Crystal City, with easy transit access, proximity to Reagan National Airport and ready-to-use office buildings, has long been a strong contender. The district and Montgomery County are also among the 20 finalists.

Betting sites give Northern Virginia the likeliest opportunity to land the project, and stock analysts have sweetened their view on JBG Smith, owner of Crystal City, as Amazon has announced has come closer. Stifel analysts Nicolaus recently upgraded the company from "sell" to "hold", stating that Amazon has added $ 4 or $ 5 to its share price.

In the Washington region, expectations are growing as clues that Amazon is in the final stages of a decision. The company tentatively considered considering an announcement by the end of October, but according to people close to the process, the announcement has now been postponed until November.

"You said publicly that you want to use HQ2 for 2019," one person said. "Working with the finalists is exactly what they absolutely do. , , I think it's a very small number of finalists. , , [The announcement] requires a degree of coordination and advance notice. "

Sharon Bulova (D), Chairman of the Fairfax County, Virginia board, where one of the sites is located, felt the atmosphere.

] "What I gather from the residents is enthusiasm," she said. "They are excited about the jobs that Amazon would bring."

It is also scared. The months-long wait did not erode concern about the potential pressure that Amazon might exert on the already steep real estate prices, congested roads, and the yawning gap between the region's wealthy and low-income residents.

When Bezos spoke at a Washington Economic Club Washington event In September, more than a dozen demonstrators occupied the sidewalk and civic groups – sometimes union activists – voiced concerns about adding such a fast growing company to the schools, streets and real estate prices of the region would mean.

Even without Amazon, the Metropolitan Washington Council of Governments estimated that by 2025, the region would need to add 235,000 housing units to keep pace with expected employment growth.

With the arrival of Amazon, the target could rise to about 267,000 by 2026, according to a recent report analysis by the Urban Institute. At the moment, the region is only able to add up to 170,000 new units, and the shortage threatens to increase inequality.

"Whether Amazon comes or not, we have a challenge there," said Peter Tatian of the Urban Institute. "The economic growth that has taken place has helped some people and caused other problems."

Amazon says it plans to invest $ 5 billion in its chosen city alone, and that its $ 38 billion headquarters added billions of dollars to the local economy in Seattle, making for $ 1 in every dollar, the company spends $ 1.40 extra. However, growth has led to divisions between the company and Seattle.

Homelessness in the city has increased, and Amazon promised to cut some of its expansion plans when the city passed a new tax on large companies to raise money for the problem.

Lack of Transparency by Jurisdiction

Bezos and the company have recently made several announcements that could dampen Amazon's image of opening H2Q.

Bezos and the wealthiest person in the world announced in September that they would donate $ 2 billion of their own money to support groups fighting against homelessness in the United States and build a network of nurseries in underserved communities.

"I do not think it's a coincidence that one of these problems was homelessness," said Joe Parilla a Brookings Institution Fellow. "I think you can create a fairly clear link between the debate that's going on in many of these tech hubs and how Amazon offers a little cover as it invests in those hot markets."

In October – after months of criticism from Sen. Bernie Sanders (I-Vt.) Over the treatment of workers, Amazon announced that it would raise the minimum wage for all employees to $ 15 an hour.

But the company's secrecy request has kept a thorny discussion about how many states and cities should be prepared to offer the business for its jobs, in the background.

Few state subsidies offered by Amazon to governments, cities, and counties have been released Some analysts say that this can lead to a setback for taxpayers if they are announced as consummate facts. Maryland has offered an incentive package worth an estimated $ 8.5 billion, while Newark subsidies are estimated at $ 7 billion. On Wednesday, a judge in Allegheny County, Pennsylvania, ordered the release of the Pittsburgh proposal after a lawsuit with a local television station. It is expected that an appeal will be made against the decision.

"I would question why cities were no longer open [with their proposals]and I suspect it's because the city's supply has been pushed back," Heidi Learner said. Chief economist of the consulting firm Savills Studley. "From the public's perspective, what is the city hiding or why should not they share how [those proposals] would actually lead to more tax revenue?"

After Amazon first asked for more information, some leaders were expecting to narrow the list of finalists in the public eye to give the development teams from the excreted cities a chance to move forward.

"I think the process has strayed a bit from them. Probably they had planned a downgrade and changed their position to that effect, "said Jason Miller, chief executive of the Greater Washington Partnership, a business group.

In addition to tax breaks, some cities offered to build or extend roads, thoroughfares, data networks, or airports. When Amazon Arrives, Brookings' Parilla said it was preferable to "maximize the broader benefits of these investments as much as possible."

He also does not think it makes sense for Amazon, a $ 816 billion company, to have a city or putting pressure on a state for a huge subsidy package that could save money on other services.

"In my opinion, Amazon does not want to repeat the contradiction in Seattle," said Parilla, "and it's not good that the mark is the existing one economic and racial inequalities in the city in which it will invest is unaware. "

The final decision should lie with Bezos. He has always shown independence in the past when he needed a new headquarters for the Washington Post shortly after his purchase.

The preferred choice among postal executives and consultants was a planned office building near Union Station. During a tour of potential locations, Bezos was touted.

This location was the favorite – until Bezos settled in and chose a downtown building.

Now Bezos is approaching a decision for Washington's far more consistent HQ2 search Area chief hopes he will not throw another curveball.

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