Amazon’s announcement that it plans to build a second headquarters in the U.S. has sent cities frantically submitting applications to try to be the chosen second home to the online retailer. Amazon plans to announce the new location next year.
The reason cities are in a rush to submit proposals is that Amazon’s new headquarters promises to bring up to 50,000 new workers with an average salary topping $100,000 all over the next 10 to 15 years. Plus, Amazon’s new location likely will spur the addition of several support companies nearby.
Amazon also has pledged to invest about $5 billion in the construction and operation of its new facility. It will continue to maintain its current headquarters in Seattle as well. Amazon says that its investment in its Seattle headquarters contributed about $38 billion into the city’s economy from 2010 to 2016.
Cities are getting creative in their proposals. For example, the city council in Stonecrest, Ga., just outside Atlanta, has voted to de-annex 345 acres of land if they are chosen for the project. (Amazon says it requires 175 acres.) The council says it will then vote to incorporate the section of land into a new city called “Amazon.”
Wherever Amazon chooses, it likely will have a big impact on the housing market.
"This projected is so highly coveted that even being on the short list will jump-start a lot of [residential] development activity," John Boyd, principal of the Boyd Company in Princeton, N.J., a corporate relocation specialist, told realtor.com®.
Indeed, even if Amazon selects the outskirts of a city, it could have the potential to create a thriving "second city-type area," says Danielle Hale, realtor.com® chief economist. "It will become a new center that people want to live around."
The chosen city, however, will then need to rush create tens of thousands of new or retrofitted housing units in a short period of time, says Robert Dietz, chief economist of the National Association of Home Builders. "That’s a tough ask," he told realtor.com®.
Amazon is accepting proposals from cities until Oct. 19. Some cities are offering major tax incentives to get Amazon’s attention.
“We want to encourage states and communities to think creatively for viable real estate options, while not negatively affecting our preferred timeline,” Amazon said in announcing its search for locations.
In Amazon’s request for proposals, the online retailer showed interest in metros with more than a million people that have stable, business-friendly economies. They also want to ensure the cities are attractive to recruit employees. The selected city will also need to have plenty of land available since Amazon will need space to accommodate about 30 buildings. It also will need to be within 30 miles of the population center, 45 minutes from a major airport, and easily accessible from highways.
"Whatever city lands this thing, their reputation is going to go through the roof," says Andrew Scott, an attorney in Chicago who specializes in corporate site selections at Dykema. "A lot of folks will say, 'if this is good enough for Amazon, it’s certainly good enough for my company.'"
Source: “Amazon Presents Prime Opportunity to Transform a City’s Housing Market – But Where?” realtor.com® (Oct. 4, 2017) and “State of Georgia to Consider Creating a City Named Amazon,” TechSpot (Oct. 3, 2017)
