At 40/1 Odds, Bet Northern Virginia for Amazon HQ2

America's favorite reality show is on, and it's time to place a wager.  Oddsmakers have Northern Virginia at 40/1 for Amazon HQ2. 

Here are 10 reasons to roll the dice:

1) Home and Washington Post.  Jeff Bezos owns the largest house in DC, right across the Potomac River from Northern Virginia.  And his favorite newspaper/hobby is next door too.  CEO location is a top predictor for corporate headquarters.

2) AWS East Coast Headquarters.  Amazon selected Northern Virginia as its AWS East Coast headquarters over Texas and Boston.  AWS now has over 7,000 people in Northern Virginia, by far its largest footprint outside of Seattle and Silicon Valley.  AWS is the focus of HQ2, and building upon this critical mass is better than starting from scratch.

3) Strategic Talent Base.  Northern Virginia has the most unique technology talent pool in the world outside of Seattle and Silicon Valley.  Talent is concentrated in the area because the Pentagon, CIA, and other US government agencies fund hundreds of thousands of high paying jobs through contractors to research and develop advanced technologies.  Amazon has hired into this talent base, including military veterans, and it sees an opportunity to scale this for competitive advantage.  AWS has more open job postings in Northern Virginia than anywhere else outside of Seattle and Silicon Valley.

4) Intersection of Technology and Government.  As Amazon grows exponentially with artificial intelligence (AI) and enters new markets like life sciences, government regulation has become a serious threat.  By locating HQ2 in Northern Virginia, Amazonians will develop personal relationships with government leaders, going to the same coffee shops and soccer games with their kids.  These connections will enable Amazon to carefully shape rules in its favor.  Moreover, as China invests billions in its AI research center 30 miles outside of Beijing and Putin declares that the winner in AI will dominate the world, the US needs strategic AI partners.  Amazon can better position itself as a strategic partner to the US government with this HQ2 location and strengthen its ties with the world's largest enterprise customer which will spend $95B this year alone on technology. 

5) World Leaders.  The clever location in Northern Virginia extends beyond the US government, though.  World leaders visit DC regularly, usually flying in and out of Washington Dulles International airport.  These global relationships are critical to maximize Amazon's international business opportunity.  With HQ2 in town, world leaders will make meetings with Amazonians a standard part of their DC itineraries.

6) Space Age 2.0.  The strategic location even applies beyond earth.  Bank of America recently projected "Space Age 2.0" as a $3 trillion market.  Colonizing Mars is a central aim of Blue Origen, a company in which Bezos is pouring billions of dollars.  His dream of exploring space began at age 5 and at Princeton, he was president of the space exploration club.  Pursuing this dream requires broad collaboration with the US government, and HQ2 in Northern Virginia provides a platform through which his vision can become reality.

7) Culture Fit and Quality of Life.  Amazon seeks people with intellectual curiosity, a strong work ethic, and recreational passion.  With DC as a focal point, Northern Virginia attracts a diverse range of the same kind of people.  From the Smithsonian and Kennedy Center to beautiful rolling hills, biking/hiking trails, wineries and craft breweries, Northern Virginia has it all with a mild climate for year-round enjoyment.  Millennials thrive in the transit-oriented, urban-walkable communities connected by metro and the historic W&OD bike trail.  Parents value world-class public schools like #1 rated Thomas Jefferson and the new Academies of Loudoun, a $122M first-of-its-kind STEM innovation school.

8) Cost of Living.  Costs in Northern Virginia are surprisingly inexpensive compared to places like Boston and New York.  The transit-oriented, urban-walkable, bike-connected communities are already designed to accommodate hundreds of thousands of new residents and plenty of room for growth remains.  Property taxes in Northern Virginia are just 1% and while Virginia state income tax is 5.75%, outstanding public schools and the educational benefits of regular DC visits enable parents to avoid the cost of private schooling for their kids.  Income tax also compares favorably to DC and Maryland which are both about 9%.

9) Transportation Hub.  The urban-walkable, transit-oriented communities of Northern Virginia are connected via metro between Reagan Airport (adjacent to DC and the Pentagon) and Dulles International Airport which handles 90% of DMV (DC, Maryland, Virginia) international flights.  As such, these metro-connected sites are easily accessible for residents and domestic/international travelers alike.  Dulles can also serve as a global logistics hub for Amazon given the airport's reach and growth capacity.  Perhaps you will see an Amazon terminal at Dulles next time you visit.

10) Business Friendliness.  Virginia is well known as a top state for business.  It is not as well known that 70% of the world's internet traffic flows through Loudoun County which also serves as Amazon's data center hub.  This nucleus is already being extended to cheaper land in central Virginia.  Further south, Virginia Beach is the axis for trans-Atlantic undersea high-bandwidth cables to Europe.  Amazon can minimize costs of these infrastructure investments through a win/win partnership with the state.

Jeff Bezos wants his DC home to become a more prized invite than the White House.  An HQ2 in DC would be spectacular, but building height restrictions and congestion make it impractical for 50,000 people and their families.  Putting HQ2 in Northern Virginia, however, works even better. 

At 40/1 odds, this is a great bet.