What happens if Amazon’s HQ2 doesn’t land in New York?

Posted On Tue, October 17, 2017 By

Posted On Tue, October 17, 2017 By In New Jersey, Policy, real estate trends

Photo courtesy of Robert Scoble on Flickr

Amazon’s nationwide competition to find a home for its second headquarters draws to a close this week, with pitches from stakeholders due Thursday. While New York City meets most of the requirements the tech giant listed for its HQ2– a population of at least 1 million people, proximity to an international airport, mass transit access and talented workforce–business costs in the city would be sky-high. However, as Crain’s reported, even if Amazon does not set up shop in NYC, politicians and developers have been preparing for a comparably-sized company to move in for over a decade. The failure of the city to win the 2012 Olympics bid back in 2005 actually turned into a success, allowing apartments to rise in Brooklyn where sports stadiums never did.

long island city, LIC apartments, apartment boom nyc
Long Island City is one of the NYC neighborhoods vying for HQ2

While Mayor Michael Bloomberg’s administration failed to secure the home of the 2012 Summer Olympics, their efforts paved the way for much of the city’s current revitalized neighborhoods. Manhattan’s Hudson Yards and Brooklyn’s Williamsburg and Greenpoint were rezoned for possible Olympic venues. After losing the bid to London, developers seized the opportunity and built condominiums and rental apartment buildings. The extension of the 7-line was originally planned as part of the bid but later revised it for the massive Hudson Yards redevelopment project.

Since then, Brooklyn and Queens stakeholders have been preparing for a company like Amazon to set up a headquarters. Over two dozen carefully crafted proposals have come from 23 NYC neighborhoods, like Williamsburg, the Brooklyn Navy Yard, Sunset Park’s Industry City and Long Island City. Queens Borough President Melinda Katz told Crain’s: “This is not a new phenomenon. This is already something we’ve been working on for several years.”

In the next few weeks, officials from Long Island City will release a plan outlining ways to attract outside companies and create job opportunities and economic development. If Amazon chooses somewhere outside of NYC, the boroughs are fully prepared for their next big pitch.

On Monday, local community groups rallied at City Hall and urged both Mayor Bill de Blasio and Governor Andrew Cuomo to not give the giant corporation tax breaks and other incentives.  Melissa Grace, a spokesperson for the mayor, told Real Estate Weekly: “As the mayor has said, this isn’t a race to the bottom for us. New York City’s talented workforce, diverse economy and strong neighborhoods are our selling points—not big discretionary tax benefits.”

downtown newark, newark, new jersey
Newark has entered the race for Amazon’s HQ2, photo via Axel Drainville on Flickr

Just over the Hudson River, the city of Newark might be making an even better bid for Amazon’s second headquarters. Located near a major airport, home to six colleges with 60,000 students, Newark’s yet-to-be-developed space might be perfect for HQ2. This week New Jersey Gov. Chris Christie and Senator Cory Booker, alongside Newark’s mayor, Ras Baraka, announced the city’s official bid in the nationwide race. Christie said NJ will offer up to $7 billion in state tax breaks for Amazon.

Reasonable commercial rents and more affordable housing make Newark’s bid promising. As the New York Times reported, market-rate apartments are the same price as subsidized housing in NYC. Downtown Newark has seen the start of revitalization, with a Whole Foods opening earlier this year and Amazon’s own Audible company opening a headquarters there. Plus, about 7,000 apartments are being developed downtown.

The city Amazon eventually chooses for their HQ2 is expected to see $5 billion in initial city investment and 50,000 new jobs. After Thursday’s deadline, the company is expected to make a decision by next year.

[Via Crain’s]

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