October 16, 2017
Amazon’s invitation for U.S. cities and states to submit proposals for its second headquarters has ignited a frenzy of interest. The new headquarters is estimated to bring a $5 billion investment and 50,000 jobs, which led governors, mayors and other officials to invest in everything from professionally produced promotional packets to PR stunts to attract attention. In the process, some cities may be spending more than they should on what is essentially a long shot. The initial bidding process ends on October 19.
Bloomberg notes that these cities “have to play Amazon’s game, but worry they’re getting played.” Virginia, for example, paid $1 million to “consultant McKinsey & Co.,” as reported by the Virginian-Pilot; Pittsburgh hired Boston Consulting Group; and the nonprofit Kansas City Area Development Council “is working with suburban demographer Joel Kotkin and urbanist Richard Florida.”
The latter cited Toronto, Chicago and Washington D.C. as his “top three” picks. Florida’s second tier choices were Dallas, Atlanta, Twin Cities, Denver, Boston and Philadelphia, and his “sleepers” were Detroit, Pittsburgh, Austin and Nashville.
Although Virginia Beach and Richmond are clearly long shots, Amazon told Virginia governor Terry McAuliffe to have them bid. Amazon even told Vallejo, “a formerly-bankrupt city of 120,000 that’s an hour ferry ride north of San Francisco,” that it is “interested in exploring the opportunity” with that city. From Vallejo’s economic development office, Will Morat says that the Amazon process will help the city “promote sites that are available for other projects.”
“There is no lose here for Vallejo,” he said. “We are going to find something that will fit.”
At the Colorado Office of Economic Development & International Trade, chief marketing officer Liz Cahill says she understands the mentality of long-shot cities that apply. “It’s a great way to draft off this public interest and get your place noticed,” she said.
DC Strategic Advisors consultant Dennis Cuneo, who’s talked with smaller cities that have applied to Amazon, agrees. “They want to get on Amazon’s radar screen,” he said. “So the next time they are looking for a new warehouse, or IT center, it’s on their list.”