Lots of discussions last week in the office about where Amazon will locate its second headquarters. After looking at the criteria the consensus converged on Denver. The Upshot did a similar analysis…and settled on Denver as well.
The huge downside of Austin is its deficits in transportation. Its airport is relatively modest. The mass transit is minimal. And traffic congestion is horrible.
I thought Dallas could be a winner. Denver housing is surprisingly pricey.
I made an abbreviated case for SLC here: https://twitter.com/Scholars_Stage/status/906624794036240385
The other downside of Austin is that lots of professionals who would be perfectly happy to live in Denver wouldn’t dream of living in Texas due to its political and cultural climate. I’ve personally turned down high paying offers to work in Texas and you couldn’t pay me any price to live there. (Full disclosure, I live in Denver.)
Baltimore is the dark horse in this race. It is close enough to Washington that functionally the two cities can share cultural amenities and educational opportunities, and Baltimore’s gritty port city vibe is similar to Seattle’s pre-Amazon. Bezos went to college nearby, and of course he owns the WAPO and has a home in the Washington area.
Canadian cities are falling all over themselves to get in on this as well — Toronto, Vancouver, Calgary and Montreal are all said to be “making bids”. Chances are probably low, as governments here are not likely to be able to match the enormous tax rebates that seem to pop up for this kind of thing in the US.
The problem with Denver is that it has no pre-existing, large body of top rank software engineers — or more generally of engineers or mathematicians and scientists. And U Colorado Boulder — really the only research university of significance in the area — is no particular great shakes. I think it’s ranked about 30th in the nation overall in terms of research.
Maybe Bezos has in mind to bring in all his workers from outside of Denver and will be happy to see them more or less stuck there with no other place to go in the region. Certainly Denver would be a good place for Amazon to have the whole region effectively to itself, when it comes to the relevant sort of talent.
But there’s a reason technology firms move to Silicon Valley — because they will have plenty of top notch talent to recruit from. Now I think Silicon Valley wouldn’t be a good choice, because of the truly ridiculous housing costs.
But Denver offers so little in terms of a pool of talent that I think it would be a less than ideal choice.
Raleigh made it further than I thought it would.
I suspect that the controversial nature of its current state politics (having just had the bathroom boycott lifted) would make folks nervous about a long term commitment.
Chicago has attracted a lot of both talent and corporate headquarters in the past few years. It is also a tech center with a lot going for it in terms of transportation etc. The downside for Chicago is that the media portrays it as a hellhole and dysfunctional when in reality it is not even in the top 25 most violent cities and has made huge infrastructure improvements in recent years. I think that Chicago may be in the running as Microsoft and Google have built large facilities there in recent years and there is a lot of area universities that cooperate with the tech world.
If I wanted to pick a dark horse candidate I would pick Detroit. Yes the place is a dump, and the weather sucks, but real estate, both commercial and residential, is dirt cheap. DTW is an international hub airport with lots of spare capacity. U of Michigan, which is exurban, but very accessible is ranked 5th in Engineering. (Texas is 9th). There are many huge corporate headquarters operations in the Area (e.g. GM & Ford).
My second dark horse would be Pittsburgh. CMU is a top program in CS. Real estate, while not as cheap or plentiful as Detroit is a lot cheaper and more plentiful than Denver. The airport is way underutilized because it was rebuilt as a hub by the late (chronically) unlamented USAir and was abandoned a couple of mergers ago.
With my corporate strategist hat on, I have to question the strategy. I think a better strategy would be pick 4 or 5 locations and put specific functions in each one. Send IT to Pittsburgh, Logistics to Detroit, Food and general merchandise to Nashville, books to NY, and media to LA. The more dispersed you are the opportunities you have to gain political favor with more Senators and Representatives, and the more protected you are against hostile attacks from state and local politicians.
The more dispersed you are the opportunities you have to gain political favor with more Senators and Representatives
You are likely correct here and it is really sad that this is where we have ended up.
Just to be contrary, I’ll say Cincinnati. After all, if Walmart could be based in Bentonville, why somewhere big?
Luke Lea: I think Cincinnati, a place I know and like, and the home of Graeter’s, the best ice cream in the known physical universe, would be a good choice. Detroit has a better airport, that is what Delta thought when they closed their Cincinnati hub. U of C is not in the class of U of M or CMU.
BTW: the Denver Airport is way far out of town.
D.C. Suburb/exurb (Dulles Tech Corridor along 28) or Atlanta would be my guess. Southeastern US would balance the PacNW HQ.
I think that this is a giant publicity stunt, in order to extract more concessions from Seattle or Washington State. Or perhaps Bezos had already chosen a place (Washington, D.C.?) and is making a great show for political reason, both within Amazon and outside it.
Having said that, I think they would choose a location east of the Mississippi – having anywhere closer would defeat the purpose of the exercise. I would pick Chicago, Washington D.C. and Atlanta are the most likely candidates, with some smaller Southern cities, Boston and New York as more unlikely candidates. I don’t see Baltimore or Detroit having a chance – the crime rate is too damn high.
Regarding Canadian cities, they do fit some criteria very well – public transit is excellent compared to any US city, there are a number of public universities, etc. I also think Joe Q. is wrong and Canadian governments would probably be generous with concessions to Amazon. The Quebec government provides the video game industry with generous tax credits, for example. There are some big minuses; Toronto is quite expensive (both in land and electricity), Montreal has Bill 101 and a strong labour movement.
Ultimately, it would come down to politics, of attracting talent spooked by the rise of Trump in the States versus angering important American constituencies that could.
Ohwilleke and russell1200, you may have never been to a red state, so you may not be aware that the elite cultural progressive juggernaut is itself “controversial” among many Americans, including a significant number of culturally conservative tech types who are happy to remain in the red states.
Personally, having enjoyed both coastal and flyover living, I think it’s a shame that my fellow Americans are so polarized. But whaddaya whaddaya…