AMAZON HQ2 – Several cities that won't make the cut

AMAZON began with a list of 238 proposed cities in October 2017 to host its second headquarters. The list has been whittled down to 20 finalists over a course of 3 months. The criteria, at least in part was a large metropolitan city of at least a million, efficient public transportation, and a high percentage of technical talent. I’m sure there is plenty of debate and argument for each of the 20 finalists. This post will focus on cities I think won’t make it and why. It just an extrapolated opinion, which means that I wouldn’t make a bet the farm type wager on it, just my observation.

SATURDAY NIGHT LIVE – AMAZON HQ2 SELECTION SPOOF

Nashville, TN., known for its music, nightlife and scenic beauty. The word is that Nashville didn’t offer Amazon much in the area of financial incentives. According to Zillow, the median home price in Nashville is $245,000, which is obviously cheaper than other finalists, such as Boston, New York, Toronto and Washington D.C. but Atlanta’s median home price is $218,000 and offering $1billion in financial incentives, and Stonecrest, GA, a city east of Atlanta, offered to rename the town “Amazon” and get this, install Jeff Bezos the city’s permanent mayor. Now that’s over the top, but if you are going to sell the steak, you’ve got to make it sizzling hot!

Toronto is a great city, with its dynamic and beautiful skyline, 400-acre High Park and its trails, sports facilities and zoo, but it also won’t make the cut. The real estate there is expensive, it has the highest average rent for one-bedroom apartments and if one wants to purchase a home it will cost you CAD$1000 per square foot or even more. Also, it’s not offering much in the way of financial incentives. Plus, it’s in another country, thus adding to the complexity of doing business there, with different laws, taxes and etc.

Next, there is Newark, New Jersey. Former Newark Mayor Cory Booker and now a New Jersey Senator has made a major effort to attract Amazon. Newark has offered some $2billion in financial incentives. but attracting talent is paramount to Amazon’s success and Newark has an unemployment rate of 7.9 percent compared to Seattle’s current unemployment rate of 4.5 percent. Amazon is also looking for a city that can attract and retain the best technical talent workforce. I’m afraid this lessens the chance for Newark, so Newark is out.

Another finalist, the city of Columbus, Ohio. It offered Amazon a 15-year 100% tax abatement as reported by the Columbus Dispatcher in October. The abatement would save Amazon almost $500,000 per $1million of investment in property over the life of the abatement and that’s pretty impressive. Also, Columbus is home of The Ohio State University, which would supply a steady stream of graduate tech talent, and it has a growing population and a vibrant venture capital and business development environment. One glaring problem, it doesn’t have an international airport, since there would be frequent employee between Columbus and Seattle this would create a logistical obstacle, so sorry but Columbus is out.

The mile-high city of Denver, Colorado is another honorable mention. I’ve visited Denver a number of times and it is a beautiful scenic and fun city. Denver has a number of intangibles, but I just don’t think it’s far east enough to make the cut, therefore I think it’ll lose out due to geography alone.

Austin, Tx is a technology hotbed and has a dense concentration of tech talent. Although the tech boom in recent years has driven up real estate prices, it is already more affordable than many of the other cities on the shortlist. However, I've worked in Austin in the past, and I don't see the transportation infrastructure being anywhere near prepared to host an additional 60,000 plus residents. An Austin selection would be a Cinderella story, but in the end, I don't think the glass slipper would fit.

In conclusion, 14 finalists are located in the Eastern time zone, so the odds are in favor of that part of the country, An Eastern location put Amazon closer to Europe, an increasingly bigger market for them. Also, three of the top 20 finalists are in the Washington DC area (DC, plus suburban Maryland and Virginia), where there are 3 major airports and efficient public transportation.

Just for kicks, I’m going to go out on a limb and make a prediction that Atlanta will win the bid for Amazon’s HQ2. My reasons are many, such as Atlanta is still close enough to DC, New York, and Boston, but has more space to offer, and is more affordable. Amazon would be able to build on the outskirts of town to avoid crowding, overpricing and congestion. Only time will reveal if I’m right, if I’m wrong well it just a post, not a serious world issue, LOL.