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Amazon is ditching its plans to build a new headquarters in New York

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The company said it will not be building a large headquarters in NYC as originally planned, adding the biggest twist of all to the marathon HQ2 search that began in 2017.

Still unclear: Whether Amazon’s 30-day return policy applies to $2.5 billion corporate campuses.

Why Bezos backed down

  • “For Amazon, the commitment to build a new headquarters requires positive, collaborative relationships with state and local elected officials who will be supportive over the long-term.”
  • “While polls show that 70% of New Yorkers support our plans and investment, a number of state and local politicians have made it clear that they oppose our presence...”

Let’s talk about the (now overjoyed) opposition

That Amazon (-1.06%), one of the largest public companies in the world, had been promised roughly $3 billion in government incentives didn’t sit too wellwith many activists and local leaders in NYC.

They criticized the lack of transparency in the search process and highlighted the potentially disruptive effects the massive new campus would have on the local community. In the end, Amazon didn't want to fight this battle.

This is a mess...

  • ...for stakeholders (like prominent New York politicians and real estate professionals) eagerly anticipating the more than 25,000 high-paying jobs and $27.5 billion in tax revenue Amazon was expected to generate.
  • ...and for Amazon, which thought it could bully any U.S. city into submission. Urban studies expert Richard Florida called it a “site selection disaster of epic proportions.”

Looking ahead: Amazon said it’s going to double down on its new locations in Northern Virginia (the big one) and Nashville (the smaller one), while growing its other existing locations around the country.

Zoom out: As Amazon became the target of an angry grassroots movement over the past year, fellow tech giants Google and Apple quietly announced their own (more modest) U.S. expansions to positive press. Amazon might want to take notes.

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