Amazon has announced that it will divide its much-anticipated headquarters between Virginia and New York.
The announcement ends a search that spanned more than a year and sparked an intense competition between North American cities to be chosen as the site of the new headquarters. The company received 238 proposals, and cities provided incentives such as grants and tax breaks to win the company’s favor.
The Virginia headquarters will be located in National Landing in Arlington, and the New York City headquarters will be located in the Long Island City neighborhood in Queens.
“We are excited to build new headquarters in New York City and Northern Virginia,” said Jeff Bezos, founder and CEO of Amazon. “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.”
Virginia Governor Ralph Northam cheered Amazon's choice of Arlington as one of two new headquarters locations, saying the state will continue to invest in infrastructure and education as a key part of the partnership.
Northam is calling the state's proposal to land the headquarters a "new model of economic development for the 21st century."
In a statement Tuesday, US Senator Mark Warner said: “As a former Governor, now Senator, but also as a former technology executive, I'm really excited about the potential Amazon offers not only to Northern Virginia but the whole capital region and the entire Commonwealth. We've seen that major investments like these can bring not only thousands of direct jobs but also lead to job growth in other industries. As we welcome Amazon's new investment in Virginia, we must commit to implementing this announcement in a way that will benefit the whole region and all of the Commonwealth.”
Virginia plans to invest in college-level computer science and related fields along with investing $50 million over 20 years in tech education for grammar and high school students.
Amazon announced it will invest $5 billion across the two locations, and create more than 50,000 jobs. The company had stipulated that it wanted to be near a metropolitan area with more than a million people; be within 45 minutes of an international airport; have direct access to mass transit; and have room to expand. It also wanted to able to attract top technical talent and be able to expand the headquarters to as much as 8 million square feet in the next decade.
Amazon was founded by Jeff Bezos in 1995 as a site that mostly sold books. The company has grown tremendously, and now produces movies, makes voice-activated Echo devices, offers online services to businesses and designs its own brand of furniture. In 2017, the company bought the Whole Foods grocery chain. In July, Bezos was named the richest man in modern history when his net worth crossed the $150 billion mark.
The company’s headquarters are currently in Seattle, Washington. It has 33 buildings, 23 restaurants and houses 40,000 employees. Bezos has said that the new headquarters will be “a full equal” to the current space in Seattle.
Amazon East: Incentives from, benefits for new Amazon HQs
Amazon could get more than $2 billion in tax breaks and other incentives as part of its deals to open up two new offices with more than 25,000 new jobs at each location. New York City and Arlington, Virginia, will be home to two new nerve centers, which are being called the second and third headquarters for the Seattle company. Nashville, Tennessee, was named as an operations hub. Following are some of the perks Amazon says it will get, along with the perks for the cities.
NEW YORK CITY - Long Island City
Incentives offered to Amazon:
- Performance-based direct incentives of $1.525 billion, based on 25,000 full-time, high-paying jobs created. This includes a refundable tax credit of up to $1.2 billion calculated as a percentage of salaries Amazon expects to pay over 10 years, which equates to $48,000 per job for 25,000 jobs with an average wage of over $150,000. Also, a cash grant of $325 million based on the square footage of buildings occupied in the next 10 years.
- Amazon will also apply for as-of-right incentives including New York City's Industrial & Commercial Abatement Program and New York City's Relocation and Employment Assistance Program. There was no dollar figure immediately attached to this benefit.
City Benefits:
- More than 25,000 full-time jobs.
- $2.5 billion investment from Amazon.
- Facilities totaling 4 million square feet, with the potential to double in size.
- Projected incremental tax revenue of more than $10 billion over 20 years.
ARLINGTON, VIRGINIA - Neighborhoods close to Reagan National Airport
Incentives offered to Amazon:
- Performance-based direct incentives of $573 million based on 25,000 jobs created with an average wage of over $150,000. That includes a cash grant of $23 million over 15 years based on the incremental growth of existing tax on hotel rooms.
- Virginia will spend up to $295 million on transportation projects, including upgrades for the Metro system and a connector bridge from Crystal City to National Airport.
City Benefits:
- More than 25,000 full-time jobs with an average wage exceeding $150,000.
- $2.5 billion investment from Amazon.
- Facilities totaling 4 million square feet, with the potential to double in size.
- Projected incremental tax revenue of $3.2 billion over 20 years.
NASHVILLE, TENNESSEE
Incentives offered to Amazon:
- Performance-based incentives of up to $102 million based on 5,000 jobs created over 7 years with an average wage of over $150,000.
- Cash grant of up to $15 million based on $500 for each job created over the next 7 years.
- Job tax credit to offset franchise and excise taxes from the state of Tennessee of $21.7 million based on $4,500 per new job over the next 7 years.
City Benefits:
- 5,000 full-time jobs with an average wage exceeding $150,000.
- More than $230 million in investment.
- 1 million square feet of energy-efficient office space.
- Estimated incremental tax revenue of more than $1 billion over the next 10 years.
The Associated Press contributed to this report.