Why North Texas (or these 4 other cities) might be the best pick for Amazon's HQ2
Cities lined up immediately when Amazon.com Inc. last week announced its interest in establishing a second world headquarters, one that would produce eye-popping employment and economic development, and asked cities to offer their best response (and incentives) to its request. Journalists at American City Business Journals, the largest publisher of metropolitan business newsweeklies in the United States, with 43 business publications across the country, also took notice. Show Full Story
Journalists at five of those publications — in the cities that have been described as the most likely to be among the finalists in the HQ2 beauty pageant — decided to join together to have a little contest of our own: Who could make the best sales pitch for our city. The contest is similar to the informal battles we have during Super Bowls (and barely more scientific). But, arguably, the HQ2 Bowl has higher stakes economically. Below, in alphabetical order, you'll find those editorial sales pitches, unvarnished and subjective. Let the best city win.
WHY AMAZON SHOULD SELECT: DALLAS
By Bill Hethcock
With a major international airport, a large and growing population and other assets, Dallas-Fort Worth seems reasonably well positioned to reel in Amazon’s second headquarters.
But a tightening market for talent in North Texas and a hit-or-miss mass transit system could be the region’s downfall.
Amazon announced last week that it is looking for a second headquarters that will bring a projected $5 billion investment and 50,000 new jobs over the next two decades. Amazon released an eight-page request for proposals that specifies what the company is looking for, starting with a metro area in North America with at least a million people that has a “stable business climate for growth.”
North Texas easily clears the population hurdle. And the region’s business climate is comparatively strong, as shown by other companies that relocate here, including Toyota Motor Corp., which continues to move employees into its new North American headquarters campus in Plano. Other business climate pluses for DFW include the lack of a state income tax and a relatively low cost of living and cost of doing business.
Mike Rosa, senior vice president of the Dallas Regional Chamber’s economic development program, said the RFP “almost looks like it was written for us.”
One clear advantage will be North Texas’ scale in terms of population and the number of companies that have relocated to the region.
“If you’re truly thinking about 50,000 jobs over a period of time, you’ve got to be in a place that has scale,” Rosa said. “We’re the fourth largest market in the country, but the largest that comes with a stable business climate.”
Amazon also wants access to mass transit, which it specifies as “direct access to rail, train, subway/metro, bus routes.” Dallas-Fort Worth is a mixed bag in the mass transit category.
Dallas Area Rapid Transit is the country's longest light rail system, stretching more than 90 miles across North Texas. In addition to Dallas, some of DART’s 13 member cities include Irving, Plano and Richardson.
But North Texas is a sprawling place, and cars and pickups remain a big part of the culture in the state. Several of North Texas’ major job centers — Fort Worth, Frisco, McKinney and Arlington among them — are not part of the DART system.
A plan for the Cotton Belt Line that would connect downtown Plano to Dallas Fort Worth International Airport has hit a roadblock, with DART board members failing to reach consensus over funding for the 26-mile line.
Another potential negative for North Texas is the region’s talent pool. DFW has long been known for its abundance of highly educated workers across a diverse range of industries, but as more companies relocate to the area, it’s becoming more common to hear hiring executives grumble about companies poaching top talent from each other.
That notwithstanding, Dallas-Fort Worth is adding tech employees at a rate that far surpasses the amount of tech degrees produced by the area, according to CBRE. That shows DFW’s ability to retain its growing number of tech graduates while attracting new talent to the area.
The DFW region added 40,310 tech jobs over the last five years while adding 17,750 tech degrees, for a “brain gain” of 22,560, the CBRE study found. The region’s “brain gain” is second only to San Francisco.
DFW is working hard to keep the pipeline of talented workers full. The Dallas Regional Chamber in April launched the “Say Yes to Dallas” campaign to attract millennials to North Texas. With a steady stream of new companies moving to the Dallas area, the campaign will help ensure that the businesses have the young, creative workers that they need to thrive after the company makes the move, chamber officials say.
Amazon is also interested in economic incentives. The Dallas-Fort Worth area will be competitive by offering state and local incentives, abatements and other methods of sweetening the deal for Amazon, Rosa said. He declined to discuss specific amounts.
“Any time you have a project where the job figures and capital investment ramps up into the billions of dollars, those incentive possibilities grow in proportion to the project,” Rosa said.
He said the Dallas Regional Chamber will submit a single proposal for the region, as requested by Amazon.
“We are excited about it,” Rosa said. “It’s our job to bring it all together and respond to this RFP, then hopefully we will enter Round 2.”
WHY AMAZON SHOULD SELECT: ATLANTA
By Urvaksh Karkaria
Atlanta — already home to CNN, the Coca-Cola Co., Delta Air Lines and United Parcel Service — has plenty of room for another big brand, namely Amazon.
Here’s a deep dive into how Atlanta scores on the HQ2’s site selection wish-list detailed in Amazon’s Request for Proposals.
Urban or suburban locations with the potential to attract and retain strong technical talent.
The old site-selection saw “Location, Location, Location” has now been replaced with “Talent, Talent, Talent.”
While Atlanta is not an established technology talent supercenter such as San Francisco, Boston or New York, the "Big A" has made great strides in developing and attracting a tech workforce.
But don’t take our word for it.
Real estate services firm CBRE ranked Atlanta fifth in tech talent among 50 of the largest cities in the U.S. and Canada. Atlanta was bested by San Francisco, Seattle, New York and Washington D.C., in the ranking of a market's depth, vitality and attractiveness to companies seeking tech talent and to tech workers seeking employment. While tech talent in Atlanta accounted for just 5 percent of total jobs in the city, tech talent grew nearly 15 percent from 2011-to-2016, the report noted. Georgia Tech is undoubtedly the engine powering Atlanta’s tech industry — generating research and talent that feeds the startup ecosystem and established tech. The school’s computer science program is ranked No. 5 in the world.
Atlanta’s tech startup ecosystem has bloomed in the past several years, with a wave of tech accelerator programs, business incubators and startup hubs that provide the educational, cultural and physical infrastructure to nurture the next generation of companies and company creators. Atlanta’s success in tech is manifested in the chorus-line of Fortune 500s (Anthem Inc., General Electric Co., Honeywell International and Home Depot) who have opened innovation centers, software development hubs and IT operations. For Amazon, site-selection will be driven primarily by the need to find innovative cities in which talent wants to live, work and play in.
Metropolitan areas with more than one million people and a stable and business friendly environment.
With nearly 5.7 million residents, Atlanta area is the ninth-largest metro in the country. The population is not just large, it’s equipped for a knowledge economy. Nearly 50 percent of the population has at least a bachelor’s degree, while tech degrees grew 30 percent between 2011 and 2015, according to the Tech Talent Scoring report. Atlanta’s burgeoning and educated population is a lure for corporate America. Lower living and operating costs have propelled Georgia to become the No.1 state in which to do business for the fourth consecutive year, according to Site Selection Magazine. In recent years, Mercedes Benz USA, Pulte Group and others have relocated headquarters to Atlanta, which now hosts 15 Fortune 500 companies.
Much of the economic development momentum is fueled by metro Atlanta’s lower cost of living relative to coastal metros. For instance, the cost to operate (rent + wages) a 500-employee tech workforce in Atlanta is $41 million, according to CBRE. It would cost $57 million to operate that same company in the Bay Area, $49 million in Boston and $43 million in Dallas.
Atlanta’s economic development success however is escalating housing costs — a key factor in cost-of-living equations. Atlanta’s housing inventory is at 2.4 months. A six-month supply is considered healthy.
Proximity to an international airport and direct access to mass transit.
Amazon wants its HQ2 to be 45 miles from an international airport, making Atlanta a winning candidate.
Hartsfield Jackson Atlanta International Airport is the world’s busiest, having shuttled 104.2 million passengers last year. Atlanta’s Delta Air Lines, coincidentally, has the second-highest market share as Seattle-Tacoma International Airport.
Mass transit, or the lack thereof, is more a blemish than a star for Atlanta. Urban sprawl, politics and a lack of buy-in from some suburban counties has kneecapped MARTA, Atlanta’s high-speed rail system. The agency has historically been underfunded and rail service is limited to parts of Fulton and DeKalb County.
Things might be turning the corner, however. MARTA recently won voter referendums to finance bus and rail service improvements in Clayton County and the city of Atlanta, making possible new stations at more infill sites for Amazon to consider in the region. MARTA also plans to extend rail lines north along the Georgia 400 corridor to Alpharetta, a Big Tech hub, and east along Interstate 20. The transit agency is planning to run a light rail line along the Clifton Corridor serving Emory University and the Centers for Disease Control and Prevention.
Amazon’s 15-year horizon to build out HQ2 gives metro Atlanta runway to beef up its mass-transit infrastructure.
WHY AMAZON SHOULD SELECT: BOSTON
By Doug Banks
When news broke last week of Amazon’s search for a second headquarters, Boston couldn’t have been happier. Based on Amazon’s request for proposals, Greater Boston was immediately considered a top contender by national media and outside experts, not just by local boosters.
Why Boston? All the same reasons General Electric (with its new “digital transformation”) moved its world headquarters here just over a year ago, and why Facebook — born at Harvard, raised in Silicon Valley — is locating its next R&D base here: Rich in talent, tops in tech and similar to Seattle when it comes to livability.
First, Amazon is looking for skilled tech labor — and the company already knows this very well. Amazon already has a significant presence in the Bay State. The company's robotics division was founded from the acquisition of North Reading's Kiva Robotics and the tech giant has a significant office in Cambridge's Kendall Square with another massive office planned for Boston's Fort Point, where it will hire 900 workers.
Boston has the knowledge factories that churn out talent — and, yes, I’m talking about our world-renowned universities, such as Harvard and MIT, as well as top 10 computer science and Big Data programs at schools like UMass.
Despite near-record-low unemployment, Greater Boston’s job growth has been more than 5 percent since 2013, according to Brookings Institute, and while real estate isn’t as cheap as some cities, it’s far more affordable than California’s Bay Area.
Given Amazon’s West Coast presence, simply being on the East Coast should put Boston near the top of the list: Why have a second headquarters so close to the first? Not only does Boston have one of the easiest-to-access international airports (how’s 10 minutes from GE’s new location in South Boston sound?), but we have the easiest access to Europe as well. And while our mass transit could use some work (hey, it’s the nation’s first subway, after all), our subways are in much better shape than those of our East Coast counterparts New York and Washington. And our traffic congestion scores higher than not only those cities but also Atlanta, Washington, and Miami.
While Massachusetts isn’t known for piling on tax incentives, Amazon shouldn’t mistake New England frugality for just being cheap. Our city and state may well get outbid on incentives, but Boston’s benefits far outweigh those being pitched by the competition.
Speaking of competitors, we expect they’ll say Boston lacks 8 million square feet of empty space. But actually, just 12 miles south of Boston is a former Naval air base with at least that much space, including 1 million square feet ready to go by 2019, a development-ready 100-acre pad, and access to public transit and highways. We also have several spoke-and-hub sites along the Orange and Red subway lines connecting Somerville, Cambridge, Boston and beyond.
From tech talent to Yankee ingenuity, Boston is the prime place for Amazon to locate its HQ2.
WHY AMAZON SHOULD SELECT: DENVER
By Neil Westergaard
Online retailing giant Amazon is looking for a home for a huge, new “second headquarters” complex. Cities across the United States are behaving like fourth graders, waving at the teacher and yelling, “pick me, pick me!”
No less than the New York Times, however, went through the economic and demographic data. The respected Times’ recommendation: Denver is the best place for Amazon to sink down another set of corporate roots.
But I could have told them that.
A temperate climate. A highly educated workforce. Gorgeous scenery, a well-developed transit system, access to top-notch research universities, an international airport. Should I go on? Lots to do during free time. Plenty of young people around and more where they came from. Three hundred days of sunshine. A craft-brewing scene like no other. Major league baseball, football, basketball, hockey, lacrosse and rugby.
World-class skiing and snowboarding nearby. Bike-friendly transportation policies. Housing prices well below either of the coasts.
Did I mention the weather? I did, didn’t I? Well, it’s important. Not to tear down other cities, but note to Jeff Bezos: Imagine your company’s workers living in Austin’s searing summer heat, Chicago’s bone-chilling cold (and summer heat), St. Louis’ humidity, Atlanta’s traffic congestion (and humidity), New England’s population density (and Lyme disease-carrying ticks that are so bad you have to wear long pants tucked into your socks when you go for a hike), Florida’s hurricanes, L.A.’s gridlock and shifting fault lines (Imagine how you’ll feel if your new headquarters slides into the Pacific)?
Yeah, it snows in Denver. But it’s gone in a few days after the sun comes out, which it pretty much does all the time. The really good snow, the kind we want, stays up in the mountains, where we ski and which feeds world-class trout streams in summer. The fact is, in Denver, we play golf in January sometimes.
Detroit, Columbus, Pittsburgh, Minneapolis? (See Chicago, reasons to visit, not to live there)
Denver is a corporate paradise, where everybody is welcome. You’ll be happy here, like all the other people who came here before and who never want to leave.
Listen to The New York Times. Denver is your best bet.
WHY AMAZON SHOULD SELECT: WASHINGTON, D.C.
By Doug Fruehling
In Greater Washington, Amazon.com, you can have it all. Everything you’ve asked for.
We’ve got the room. We’ve got the people. We’ve got the schools and a growing tech sector. We’ve got the access by road, rail and air. Even water if that floats your boat.
First, the basics. We are a metropolitan area of roughly 6 million people, far exceeding your 1 million minimum. We are conveniently located on the Northeast Corridor, an Acela trip away from Philadelphia or New York City or Boston, but also within reasonable distance of our southern friends in Charlotte and Atlanta and our Midwest friends in St. Louis and Chicago.
Our economy is stable — we endured the Great Recession better than most — and we no longer depend exclusively on the presence of the federal government to endure. Still, have the federal government in your backyard is a big selling point.
Whether you choose D.C., Virginia or Maryland, our respective state and local governments have a reputation for clearing paths to get you what you need. Marriott. Advisory Board. Yelp. Nestle. Hilton. Northrop Grumman.
Volkswagen. Look them up. They’re here or coming in part because our governments stepped up with incentive packages that were competitive with, or better than, everyone else’s.
Loudoun County is a national data center hub through which 70 percent of the world’s Internet traffic travels. It also has hundreds of undeveloped acres sitting on a rail line scheduled to open in 2020. In Fairfax County, Amazon Web Services recently chose to establish an East Coast corporate campus.
The District was recently recognized as one of the nation’s top tech towns for its educated and tech-knowledgeable workforce, growth entrepreneurship and access to venture capital. D.C. provides you direct access to federal lawmakers. And your founder already owns a house here! And The Washington Post!
And you might know suburban Maryland as the home of one of the nation’s top research schools — the University of Maryland, College Park — as a leader in the biotech sector, as one of the first five locations of Amazon’s instant pickup locations.
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