It’s official: Amazon is no longer moving forward with plans made last year to bring 25,000 jobs to New York City.
Amazon released a statement today saying that it will not be building a headquarters in New York City. Amazon chose the Big Apple for a new campus as part of its search for a second headquarters, announced last year.
It will move forward with plans to bring 25,000 jobs to a Washington, D.C. suburb, and 5,000 jobs to Nashville, where it’s establishing a new operations hub.
Here’s the statement released in full by Amazon, per the New York Times.
After much thought and deliberation, we’ve decided not to move forward with our plans to build a headquarters for Amazon in Long Island City, Queens. For Amazon, the commitment to build a new headquarters requires positive, collaborative relationships with state and local elected officials who will be supportive over the long-term. While polls show that 70 percent of New Yorkers support our plans and investment, a number of state and local politicians have made it clear that they oppose our presence and will not work with us to build the type of relationships that are required to go forward with the project we and many others envisioned in Long Island City.
We are disappointed to have reached this conclusion — we love New York, its incomparable dynamism, people, and culture — and particularly the community of Long Island City, where we have gotten to know so many optimistic, forward-leaning community leaders, small business owners, and residents. There are currently over 5,000 Amazon employees in Brooklyn, Manhattan, and Staten Island, and we plan to continue growing these teams.
We are deeply grateful to Governor Cuomo, Mayor de Blasio, and their staffs, who so enthusiastically and graciously invited us to build in New York City and supported us during the process. Governor Cuomo and Mayor de Blasio have worked tirelessly on behalf of New Yorkers to encourage local investment and job creation, and we can’t speak positively enough about all their efforts. The steadfast commitment and dedication that these leaders have demonstrated to the communities they represent inspired us from the very beginning and is one of the big reasons our decision was so difficult.
We do not intend to re-open the HQ2 search at this time. We will proceed as planned in Northern Virginia and Nashville, and we will continue to hire and grow across our 17 corporate offices and tech hubs in the U.S. and Canada.
Thank you again to Governor Cuomo, Mayor de Blasio, and the many other community leaders and residents who welcomed our plans and supported us along the way. We hope to have future chances to collaborate as we continue to build our presence in New York over time.
The reversal comes after New York state senate leaders appointed Sen. Michael Gianaris, a vocal opponent of the deal, to a board that would have had the power to cancel the deal — or at least revoke the incentives New York planned to offer Amazon. When the New York headquarters was first announced, the state said it offered Amazon about $1.525 billion in “performance-based direct incentives” in order to bring the proposed 25,000 jobs over the next several years, though the total incentive package eventually grew to around $3 billion.
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Amazon’s search for a second headquarters was a year-long affair. The company first announced in September 2017 that it was looking to build a second headquarters somewhere in North America, and initially said that the project would bring 50,000 jobs. Amazon invited metropolitan areas with at least 1 million people to pitch the company on why Amazon should come to their city. Amazon ended up receiving bids from 238 metro areas, before whittling that down to a list of 20 finalists. By the time Amazon made its decision in the fall of 2018, the company announced that it would be splitting the proposed 50,000 jobs between New York and a Washington, D.C. suburb in Northern Virginia, because the company believed it could “recruit more top tech talent” by being in two locations. Amazon had planned to open its New York City headquarters in Long Island City, a neighborhood in the Queens borough of New York.
An Amazon spokesperson, when reached by VentureBeat, declined to comment further.
Mark Muro, a senior fellow at the Brookings Institution, told VentureBeat that Amazon’s decision to pull out of New York is emblematic of the pushback big tech is receiving in so-called “superstar” metros — the cities that are adding the most new jobs in the country, but are also seeing their cost of living rise at an astronomical rate, like New York. State Sen. Gianaris, in an interview with CNN Business, said that he was worried about the new Amazon headquarters “turning” New York into San Francisco and Seattle, which have seen some of the highest increases in housing prices in the country as more tech companies have moved in. As a result, both cities have had at some point over the past several years some of the highest rates of homelessness in the country,
“For these superstars, these sites lead to overheating of the economy, massive quality of life issues around housing,” Muro told VentureBeat in a phone interview.
Muro also mentioned that although Amazon has said it doesn’t intend to reopen the HQ2 search, it doesn’t need to even if the company decides to open a new campus elsewhere — because it already has RFP documents from the 238 cities that placed bids the first time, detailing what kind of open real estate they have and what incentives they would be willing to offer. He adds that Amazon may also decide to spread the intended 25,000 jobs across more of its offices than just the Northern Virginia and Nashville ones.