Amazon has confirmed reports that it will split its second headquarters, “HQ2” between two cities. After speculation that the Washington, D.C., Dallas and New York City metro areas were the three finalists, the e-Commerce giant confirmed in a blog post that the HQ2s will be located in Arlington, Va. and the Long Island City neighborhood of Queens, N.Y.
Additionally, Amazon unveiled that it will build a one-million-square-foot “Operations Center of Excellence” in downtown Nashville, which will be responsible for the company’s customer fulfillment, transportation and supply chain across the East Coast.
Amazon originally said it would invest $5 billion and employ 50,000 workers at HQ2, but under the new plan the company will split the workforce evenly, with 25,000 employees in each city. The Nashville operations center will create more than 5,000 jobs, and hiring at all three locations will begin in 2019.
The Arlington project will be located in National Landing, a rebranded name for the neighborhood known as Crystal City near Reagan National Airport.
Both the Northern Virginia and New York locations will include four million square feet of office space each, with both having the potential expand to eight million square feet.
Amazon will receive performance-based incentives of $1.525 billion in New York and $573 million in Virginia. The company will donate space on the Long Island City campus for a tech startup incubator for use by artists and industrial businesses, and will donate a site for a new primary or intermediary public school. The company also will invest in infrastructure improvements and new green spaces.
The economic impact of the New York office will generate more than $10 billion in tax revenue over the next 20 years, while the Northern Virginia office will generate another $3.2 billion over that same period.
Amazon will receive performance-based incentives of up to $102 million for the Nashville hub.
The biggest draw of the Amazon HQ2 bidding process was the much-coveted promise of 50,000 jobs. The average annual pay of an employee in both the New York and Arlington offices will be $150,000, according to the blog post.
The driving force behind the decision to build two equal offices was the ability to recruit more top talent, particularly in software development, the blog post said. In a November 2017 Retail TouchPoints interview, attorney Steven Polivy said that the presence of a highly educated, tech-savvy workforce — or an area’s ability to attract workers of this caliber — would be a key factor in Amazon’s final decision about where to locate HQ2.
“Their presence will create demand for other companies that will want to be located near Amazon,” Polivy said. “These will be companies that do things that are complementary to Amazon’s businesses, which go beyond retail to include fulfillment, cloud services, streaming entertainment services, etc. You’ll see people needed who are in the graphic arts and advertising, for example.”
The process also has given Amazon extensive information about top U.S. and Canadian locations — 238 of them to be exact — to potentially negotiate other deals for additional offices, warehouses or data centers.
The company listed a variety of conditions for prospective host cities, including a business-friendly tax environment, a growing workforce and proximity to a major airport.