After months of discussions and speculations, Amazon has now finally announced the location of its “2” new headquarters. Yes, not one, but two new cities — New York City and Arlington — will both be getting split Amazon HQs. With this and the company’s current Seattle HQ, Amazon will now function out of three global headquarters, all of them based in North America.
The sheer impact of this move for the two cities in numbers, is humongous, to say the least. Amazon says, that it will invest $5 billion in developing premium real estate and infrastructure across the two new locations. In the process, the ecommerce and cloud services giant will create more than 50,000 jobs across the two new headquarters locations, with more than 25,000 employees each in New York City and Arlington.
The new Washington, D.C. metro headquarters in Arlington will be located in National Landing, and the New York City headquarters will be located in the Long Island City neighbourhood in Queens.
As part of Amazon’s new headquarters, New York and Long Island City will benefit from more than 25,000 full-time high-paying jobs; approximately $2.5 billion in Amazon investment; 4 million square feet of energy-efficient office space with an opportunity to expand to 8 million square feet; and an estimated incremental tax revenue of more than $10 billion over the next 20 years as a result of Amazon’s investment and job creation.
Amazon will receive performance-based direct incentives of $1.525 billion based on the company creating 25,000 jobs in Long Island City. This includes a refundable tax credit through New York State’s Excelsior Program of up to $1.2 billion calculated as a percentage of the salaries Amazon expects to pay employees over the next 10 years, which equates to $48,000 per job for 25,000 jobs with an average wage of over $150,000; and a cash grant from Empire State Development of $325 million based on the square footage of buildings occupied in the next 10 years.
While the infrastructure cost, space and other metrics remain the same, salaries and other tax benefits which Amazon will get when compared to NYC, vary.
The company will receive performance-based direct incentives of $573 million based on the company creating 25,000 jobs with an average wage of over $150,000 in Arlington. This includes a workforce cash grant from the Commonwealth of Virginia of up to $550 million based on $22,000 for each job created over the next 12 years. Amazon will only receive this incentive if it creates the forecasted high-paying jobs. The company will also receive a cash grant from Arlington of $23 million over 15 years based on the incremental growth of the existing local Transient Occupancy Tax, a tax on hotel rooms.
An upgrade for Nashville
In addition, Amazon announced that it has selected Nashville for a new Center of Excellence for its Operations business, which is responsible for the company’s customer fulfillment, transportation, supply chain, and other similar activities. The Operations Center of Excellence in Nashville will create more than 5,000 jobs.
There’s more to come on this big story, so stay tuned.
Founder of the The Tech Portal. Now a consulting editor for the platform. Has advised and worked with numerous early/mid-stage startups during past 5 years in various roles. You can click on his LinkedIn profile and drop in a message to get in touch.