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Home / Business / Calling Wendy meant half of the new Amazon headquarters and an economic triumph for Virginia

Calling Wendy meant half of the new Amazon headquarters and an economic triumph for Virginia

Virginia learned that it had won the biggest competition for economic development in US history as an inconspicuous civil servant at 2:00 pm in the parking lot of a Wendy's restaurant in the Shenandoah Valley Call received Monday.

The call to Stephen Moret has ended 14 months of intense negotiations and ended the fears that lasted until the very last moment that Virginia would lose the prize, especially because of the high price of labor and real estate. At one point in time, Arlington Business Development Director Victor Hoskins was convinced that the state had no chance because rivals like Maryland and New Jersey offered much larger subsidies and other incentives.

"The biggest question in our minds – really to the end – how would [Amazon] balance the availability of talent versus cost," said Moret, chief executive of the Virginia Economic Development Partnership and the state's top negotiator with Amazon.

Principles is "frugality."

Amazon was not much help, it was stingy to exchange information, and forced the Virginians to assess the interests of the company based on the frequency of their calls and visits and the nature of the questions. Even in the conference call on Monday, when Amazon's negotiator Holly Sullivan confirmed that Virginia received only half of the initial proposal for 50,000 jobs, she refused to announce New York City as the winner of the other half. [19659009] An empty building in Arlington's Crystal City area is demolished to make Amazon a part of its new capital can build tsitzes. (Cliff Owen / AP)

Instead of the clapping and pledging of heads of state such as New York Governor Andrew M. Cuomo (D) or the glittering perks that others offer, such as street renaming and free airport parking and museum entry, Virginia's simpler offer was made by Bureaucrats like Moret settled. State officials said Amazon was particularly impressed by the state's willingness to invest an additional $ 1.1 billion over 20 years to build higher technical education.

The Virginians became gradually more confident, since Amazon was asked in the summer for ever more detailed information about the availability of office buildings and the level of government subsidies.

"They have really narrowed the real estate and the economic development package," said Hoskins. "At that time we knew it was serious."

In late July, it came to a watershed when the Amazon officials launched the second of their three group visits to Northern Virginia. They just wanted to visit the Arlington area and adjacent property in Potomac Yard, Alexandria, and avoid other sites in Northern Virginia they visited on their first visit in February. They spent the entire day with a dozen offices with a group of executives from JBG Smith, Crystal City's leading real estate developer.

The CEO of JBG Smith, Matt Kelly, said before he visited the group, they said to wear comfortable shoes: & # 39; We want to see everything.

Despite prolonged tug-of-war incentives and transportation investment, both Virginia and Amazon said that the key benefits Arlington offers were at the beginning of the negotiations. This was the availability of a highly skilled workforce and a diverse, city-like environment with good public transport that was likely to attract the young, upscale tech professionals that are the Amazon's most valuable resource.

"They eventually realized that the single most important thing was the best talent in the world, and how could they get that," said Moret.

This assessment was voiced, albeit indirectly, in comments by some losers after the announcement The Mayor of Dallas, Michael Rawlings (D), said an Amazon official told him that his city was largely down because there were not as many high-tech workers available as the company needed right away It was not enough that Dallas had offered to turn to Amazon's animal friends by giving up acceptance fees for Amazon employees at an urban shelter and offering free microchips to all Amazon pets by 2022, according to the Dallas Business Journal.

The mayor of Chicago, Rahm Emanuel (D), whose offer included larger subsidies than those offered by Virginia, told the Chicago Tribune, "There are some things that we need to continue building, and that ensures we have a tech economy. , , actually world class. "

Amazon declined to comment on this story, beyond what it publicly said Tuesday at the time of its announcement. A company spokesman declined to say whether CEO and founder Jeffrey P. Bezos visited Crystal City. Bezos owns The Washington Post.

Since the beginning of Virginia's efforts to offer three regional offers of 238 nationwide, the state has emphasized its ambition to help Amazon attract top-tech talents.

In its original proposal in October 2017, Virginia offered a technology plan for higher education, which over the course of 20 years involved a $ 1.1 billion commitment to the expansion of computer science and related fields at the university's and adult education centers State was. About a quarter of the money will help Virginia Tech set up a $ 1 billion technology campus in Alexandria.

The training proposal was not officially part of the Amazon incentive package, and Amazon did not refer to it in its press releases. Apparently, it did not want to be accused of having asked the state for such a large investment, and thus critics of government subsidies for large, rich companies equipped with ammunition.

But Governor Ralph Northam (D) announced technology education and incentives for Amazon packages at the same time, and state officials said the former played an important role in Amazon's decision.

"This was part of the conversation with Amazon," said Commerce Minister Brian Ball. "This is something they wanted and we wanted."

The trial began in January when Amazon cut the list of 238 to 20 finalist jurisdictions. One of them was Northern Virginia, which offered four sites.

In late February, Sullivan and other Amazon officials dined with Moret, Hoskins, and other state and local officials at the torpedo factory in Old Town Alexandria, spending the next day exploring everything Northern Virginia's sites.

Sullivan, who previously worked in Montgomery County in economic development, knew the region well. She and Moret also worked together when Amazon Web Services added 1,500 jobs to Herndon in early 2017.

"They were not really in Crystal City at the time," Hoskins said. "They asked about the church: what people live in Arlington?"

Amazon also asked for public transport and expressed concern that Virginia, Maryland and the district had not yet agreed on special funding for Metro.

"Thankfully, when they returned [in July]this had already happened," said Hoskins.

Hoskins was also unhappy when he saw that Maryland offered $ 8.5 billion in incentives and $ 7 billion in New Jersey.

"When I saw these numbers, I shook my head and said," We can not get there from here, "Hoskins said, and there was also concern that Atlanta or Chicago might win because of lower housing costs.

Virginia historically less generous than other states, which provides incentives, and in the end, the state and Arlington pledged $ 573 million for 25,000 jobs plus a total investment of $ 223 million in transportation, including the modernization of two metro stations and the construction of a pedestrian bridge that links Crystal City to Reagan National Airport, and subsidies and transportation investment will increase as Amazon creates more than 25,000 jobs, with the state's official statement of intent to increase to 37,850.

Retrospective It seems Amazon decided in spring that it was the case in Northern Virginia The technology and quality of life they wanted, state and local officials said. From then on, the company increasingly focused on details of the Crystal City-Potomac Yard site, which was jointly offered by Arlington and Alexandria.

It also seemed that other cities fell out of the race due to the diminishing buzz of the media and the rumor mill's economic development. Jim Rooney, president of the Greater Chamber Chamber of Commerce, said civil servants had only "light contact" with Amazon's leaders following a site visit in the spring.

In the last weeks before Tuesday's announcement, the biggest change came in September, when Amazon talked about splitting. According to Virginia, the initial investments between two cities were officials whose report was confirmed by other related parties.

The Virginians were stunned, but they endeavored to create 25,000 jobs – which is still the US's largest economic competition development price of all time.

"We got through the [reduction] very quickly, and all in all, I think it was a better deal," Hoskins said. "With 25,000 it was less complicated."

The state recalculated its incentives and cut its direct subsidies and transportation investment by half. The state did not cut its planned spending on the Technology Initiative for Higher Education, largely because it felt the state needed to make that investment anyway.

In another adjustment, the state increased the labor subsidy promised by Amazon from $ 20,000 to $ 22,000 for each newly created job. Moret said after Amazon agreed that the average salary for employees in Arlington would be at least $ 150,000 a year, rather than $ 100,000, as in the company's original proposal.

Amazon executives visit Arlington for the third and final time In September, they met for the first time with Arlington County chairman Katie Cristol, vice chairman Christian Dorsey, and district leader Mark Schwartz.

"We were all ready to perform [Arlington] and in the end they told us what a great community is Arlington," said Schwartz. "Without much nudging, they said things that made us think they had done their homework in Arlington."

Schwartz was driving in County Ballston on Monday afternoon when Hoskins called him and said, "I have some bad news." Schwartz girded himself, but it turned out to be unnecessary, saying, "We won! We won! "19659045] Rachel Chason, Katherine Shaver and Susan Svrluga contributed to this story.

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