WASHINGTON - Amazon has selected Northern Virginia and New York City as the homes of its second headquarters, a move that is expected to create an economic boom for both regions as the cities split 50,000 high-paying jobs.
Amazon officially made the announcement Tuesday morning. Amazon said hiring will begin for the two locations in 2019.
“We are excited to build new headquarters in New York City and Northern Virginia,” said Amazon founder and CEO Jeff Bezos in a written statement. “These two locations will allow us to attract world-class talent that will help us to continue inventing for customers for years to come. The team did a great job selecting these sites, and we look forward to becoming an even bigger part of these communities.”
Amazon said it will invest $2.5 billion in Northern Virginia, including the construction of a 4 million square feet of energy-efficient office space that has the opportunity to expand to 8 million square feet. The company predicts the area will receive a tax revenue of $3.2 billion over the next 20 years as a result of the new facility.
The company said it will receive $573 million combined from Virginia and Arlington in performance-based direct incentives leveraged on the promise of Amazon creating 25,000 jobs with an average wage of over $150,000 in Arlington. The package includes a workforce cash grant from Virginia of up to $550 million based on $22,000 for each job created over the next 12 years. Amazon will also receive a cash grant from Arlington of $23 million over 15 years based on the incremental growth of the existing "Transient Occupancy Tax," a tax on hotel rooms.
Amazon said it will only receive the incentive-based money if it creates the forecasted high-paying jobs. The full agreements between Amazon and the Commonwealth of Virginia and Arlington County can be found at the bottom of this report. (App Users: Click here to see)
“This is a big win for Virginia – I’m proud Amazon recognizes the tremendous assets the Commonwealth has to offer and plans to deepen its roots here,” Virginia Gov. Ralph Northam said in a written release. “Virginia put together a proposal for Amazon that we believe represents a new model of economic development for the 21st century, and I’m excited to say that our innovative approach was successful. The majority of Virginia’s partnership proposal consists of investments in our education and transportation infrastructure that will bolster the features that make Virginia so attractive: a strong and talented workforce, a stable and competitive business climate, and a world-class higher education system.”
Amazon said it was coming to "National Landing" in Northern Virginia, which is a newly branded neighborhood that encompasses parts of Pentagon City and Crystal City in Arlington and Potomac Yard in Alexandria, according to Virginia Tech Innovation Campus, which will be located less than 2 miles away from where Amazon's new location will be built.
Amazon also announced that it will open an operations center in Nashville that will create approximately 5,000 jobs in Tennessee.
Bezos previously stated that the new headquarters, known as “HQ2,” would be "a full equal" to the company's current headquarters in Seattle. Amazon said it will hire 50,000 new full-time employees over the next 15 years who would have an average pay of more than $100,000 a year. It was believed that Amazon's second headquarters would be in one location but the company opted to split the headquarters into two locations.
Amazon announced back in January it had narrowed its search for the location of its second headquarters to 20 cities after it reportedly received 238 proposals. Most of the cities that made the shortlist were located along the East Coast and in the Midwest. The District, Northern Virginia and Montgomery County were among the 20 finalists and Northam, Maryland Gov. Larry Hogan and D.C. Mayor Muriel Bowser launched a joint-effort to land the online-retail behemoth in the DMV.
The region was seen as a favorite to land HQ2 as many drew lines between Bezos’ connections to the District. Bezos owns the Washington Post and a home in the prominent Kalorama neighborhood.
Amazon has selected Crystal City in Arlington for its D.C. location and is already familiar with the area as it has data centers nearby in Ashburn, Sterling, Chantilly, Manassas and Haymarket. Crystal City, which features 1980s-era office towers, has been trying to revive itself after thousands of federal jobs moved elsewhere.
Amazon had stipulated that it was seeking to be near a metropolitan area with more than a million people; be able to attract top technical talent; be within 45 minutes of an international airport; have direct access to mass transit; and be able to expand the headquarters to as much as 8 million square feet in the next decade.
Amazon also made it very clear that it wanted tax breaks, grants and many other incentives.
While Amazon’s rise has been applauded by many, it has not been without local critics in Seattle who say the influx of mostly well-heeled tech workers caused housing prices to skyrocket, clogged the streets with traffic and changed the city for the worse. Opponents have also derided the competition for Amazon’s new headquarters as corporate welfare for one of the world's richest companies.
The Associated Press Contributed to this report.