Smaller communities vie for piece of Amazon HQ pie

Published 2:15 pm Friday, September 15, 2017

When Amazon last week announced plans to open a second full-service headquarters somewhere in North America, it set in motion a frenzied bidding war between major cities like Boston and Toronto. 

But smaller cities across the U.S. also want their chance to vie for a piece of the pie. Understandably, since the HQ2, as Amazon is calling it, is expected to hire 50,000 highly paid workers and invest some $5 billion in construction and operation. 

And, if HQ2 follows in the footsteps of HQ1, the chosen city would benefit handsomely: Amazon estimates its Seattle investments has generated $38 billion for the city’s economy since 2010.

The Essex County, Massachusetts, communities of Lawrence, Haverhill and North Andover announced this week they intend to send a joint application to the online shopping and media behemoth.

Amazon’s HQ2 Criteria

In choosing the location for HQ2, Amazon has a preference for:

  • Metropolitan areas with more than one million people
  • A stable and business-friendly environment
  • Urban or suburban locations with the potential to attract and retain strong technical talent
  • Communities that think big and creatively when considering locations and real estate options

HQ2 could be, but does not have to be:

  • An urban or downtown campus
  • A similar layout to Amazon’s Seattle campus
  • A development-prepped site. We want to encourage states and communities to think creatively for viable real estate options, while not negatively affecting our preferred timeline.

Information gathered from Amazon’s Sept. 7, 2017, news release. 

The Merrimack Valley, a mostly middle- and working-class region, is still struggling to fill millions of square feet in mills that have been empty since manufacturing went south or overseas in the decades after the Second World War.  

With around 300,000 residents, the area doesn’t meet Amazon’s metropolitan population requirement, but adding nearby metropolitan Boston would boost the population to well over 1 million.

“We have access to a rail line and transportation,” North Andover Town Manager Andrew Maylor said, ticking off the ways the three municipalities meet the specifications in the request for proposals that Amazon posted on its website. “We have strong access to employees. We have different sites in the communities that could be combined to make a regional campus. If you read through the (requirments), we meet as a region almost all the criteria. We have high-tech staff. All these things exist in these communities.”

Amazon’s request for city proposals also said it is seeking “an urban or downtown campus” that would have a layout similar to Amazon’s Seattle campus, which could rule out the regional campus that the Massachusetts bid proposes. But the company also says it will consider suburban locations and “multiple real estate sites in more than one jurisdiction.” 

In southern Indiana, a business and industrial park is also throwing its hat in the ring.

The River Ridge Commerce Center in Jeffersonville is close to airports, railroads and interstates, the nearby Lewis and Clark bridge provides direct access to Kentucky, Amazon already has a presence in the area, and the metropolitan area is home to (slightly) more than 1 million people.  

But even if smaller rural or suburban areas meet Amazon’s basic criteria of population numbers or convenient transportation, it is probably still a stretch for them to become frontrunners in an already competitive race.

Uric Dufrene, Indiana University Southeast Sanders chair in Business, says a major deciding factor could be the lack of engineering and information technology workers in these areas.

Fewer people means fewer easily filled positions. Amazon could draw people from nearby metropolitan areas, such as Indianapolis, Cincinnati and Nashville, but not everyone is willing to move away from home or established urban areas.

Applicant cities have until Oct. 19 to submit proposals. A final decision is expected in 2018.

Cities and economic development projects like River Ridge are currently lobbying local and state governments for incentive packages, such as tax abatements or new roadways.

Meanwhile, big names such as Atlanta, Raleigh, Austin, Boston and Washington, D.C. have been floated as top contenders.

Bloomberg reports Boston is currently ahead of the pack, according to several senior executives, but Amazon’s official line is every city remains “on an equal playing field” for the time being.

“We are energized by the response from cities across North America who have already reached out to express their interest,” Amazon said in an email to Bloomberg. “There are no front-runners as this point. We are just getting started with the process.”

Danielle Grady of the Jeffersonville, Indiana, News and Tribune, and Keith Eddings of the North Andover, Massachusetts, Eagle-Tribune, contributed to this report.