‘HQ2’ to nyc?

| 24 Oct 2017 | 03:45

Mayor Bill de Blasio told the audience at a town hall meeting at St. Francis College in Brooklyn on October 18 that online retailers like Amazon are "very destructive to communities," saying he's never shopped at the e-commerce behemoth. His timing was unusual: Only a couple of hours earlier, the city had submitted a bid to lure Amazon's proposed second headquarters. Photo: Benjamin Kanter/Mayoral Photo Office

New York City quickly jumped into the fray when Amazon unveiled a business expansion plan that’s expected to become the largest in U.S. history — not counting the ramp-up to World War II.

The Seattle-based e-commerce giant on September 7th trumpeted a hyper-ambitious proposal to invest $5 billion in construction on a second headquarters that will create some 50,000 high-paying jobs.

Overnight, an unprecedented nationwide competition among cities and states was ignited. And as a fierce bidding war raged for “HQ2,” as the project is dubbed, Mayor Bill de Blasio on October 16th fired off a forceful if immodest letter to Jeff Bezos, the company founder and CEO:

“The case for New York City is simple,” de Blasio wrote in response to the bid solicitation. “We are the global capital of commerce, culture and innovation. No city has a greater diversity of talent, of industries, and of collisions that fuel great ideas and companies.”

The city was hardly alone. Amazon said it received 238 proposals from cities and regions in 54 states, provinces, districts and regions for what became, in effect, a torch-lighting for the Olympics of the business world.

In submitting its formal proposal, the city’s Economic Development Corp. laid out the case for how the city would meet Amazon’s criteria, which includes providing 500,000 square feet of offices by 2019 with an eventual expansion potential of a staggering eight million square feet of buildable space.

A diverse tech talent pool, bountiful housing market, vast air-transit system, world-class academic and research institutions and the nation’s largest public transportation network, as well as an “ecosystem for innovation” and the “biggest tech pipeline in the Northeast” were key attributes flagged by EDC.

As for locations, City Hall picked two Manhattan sites:

* Midtown West. And specifically, Hudson Yards, the new-and-still-rising-live-work-and-play neighborhood, which boasts a potential campus of 26 million square feet. There are 2.4 million workers within a 45-minute commute of the site, and the midtown core is served by 15 subway and rail lines, EDC said.

* Lower Manhattan. And specifically, the rebuilt World Trade Center complex, which offers 8.5 million square feet, breathtaking harbor views, a workforce of 1.7 million people within commuting distance and 13 nearby subway and PATH lines.

The city also touted sites in Long Island City in Queens and the so-called Brooklyn Tech Triangle, which includes downtown, DUMBO and the Brooklyn Navy Yard.

Bottom line: If the city lands HQ2, it will reap $2.8 billion to $3.3 billion in “estimated taxes from direct jobs” over a 30-year period, an EDC analysis found.

Sounds good so far. But there are a couple of wrinkles that Amazon — which was founded in 1994 and is now world’s largest retailer — will be sure to notice:

* Tax incentives. There are none in the city’s proposal. de Blasio has generally, but not always, opposed them in corporate retention and relocation deals. Yet Amazon has said tax breaks would be “a factor” in its ultimate decision.

As City Hall keeps its wallet shut, rival locales are ponying up. New Jersey Governor Chris Christie is offering $7 billion in tax credits, $2 billion more than Amazon plans to invest, to lure the retailer to Newark. Governor Andrew Cuomo is also wielding incentives to bring HQ2 to several upstate communities, but so far, he’s refused to quantify them.

* Muddled messages. Barely two hours after City Hall submitted its proposal, de Blasio told a town hall meeting in Brooklyn that online shippers like Amazon are “very destructive to communities.”

For good measure, he added that he’s never shopped at Amazon, much prefers the city’s “brick-and-mortar retailers,” doesn’t have much use for Starbucks either, and suggested his listeners make similar shopping choices.

Despite the discordant words, the public courting continues. Officials at City Hall called attention to a “Dear Jeff” letter from the Partnership for New York City, the influential business group, which called the city the “clear choice” for the company’s second headquarters.

“In New York, you will find a community of super-achievers who hail from every country in the world,” dozens of member CEOs wrote Bezos last week. “That’s the reason we are here, and it is what makes this the logical place for Amazon’s HQ2. We hope you agree.”

EDC noted in its proposal that Amazon doesn’t have to move to the city — it already has several important business operations here.

The company has two brick-and-mortar bookstores, in Columbus Circle and at 7 West 34th Street, where it also has a large distribution center. Its online fashion retailer, Shopbop, is located at 230 West 41st Street.

It also has 92,500 square feet of office space at 1350 Sixth Avenue. And its advertising unit will be moving into 360,000 square feet at 450 West 33rd Street, now known as 5 Manhattan West, by 2018.