Only one metropolis will win Amazon’s second headquarters. But different cities can still profit from the course of.
Some cities similar to Denver, Philadelphia and Toronto mentioned they’ve seen a spike in curiosity from companies seeking to increase or relocate, after being named to the short list for Amazon’s new facility, dubbed HQ2.
“The attention that has come our way since being shortlisted is enormous,” mentioned Julia Sakas, a spokesperson for Toronto Global, the group that organized the metropolis’s bid for HQ2. “It has literally put us on the radar of companies that might never have considered the Toronto Region.”
Last 12 months, Amazon acquired 238 proposals from cities giant and small to host its subsequent headquarters. It introduced the prime 20 candidates in January. The campus will value about $5 billion to construct and can create as many as 50,000 jobs.
Some cities provided Amazon huge tax breaks and perks for HQ2. For instance, Newark, New Jersey, announced $7 billion in incentives to lure the firm, whereas Maryland provided an $8.5 billion package deal (Montgomery County is one in all the finalists).
“Many cities put in an incredible amount of work for Amazon HQ2, and this [could] have distracted them from other economic development opportunities,” mentioned Nathan Jensen, a professor at the University of Texas at Austin. “But using their information and marketing materials from the HQ2 bid could be an effective way to reuse some of the outputs from this hard work.”
Cities like Toronto are additionally reusing the data they compiled for his or her Amazon proposals to assist entice different corporations. Since publishing the bid on-line in October, Sakas mentioned it has been downloaded by companies and the public greater than 15,000 occasions.
Some native organizations have already used the knowledge from the proposal for analysis functions.
Philadelphia has skilled extra curiosity from companies, too, in line with a spokesperson for the metropolis’s Commerce Department.
“The videos [we created for HQ2] were able to capture some of the city’s best qualities and highlight them in a way that was easily understood by people who may not be as familiar with Philadelphia compared to places like New York or Washington DC,” the spokesperson mentioned.
Several corporations have referenced Philadelphia’s Amazon pitch as a catalyst for his or her new curiosity in the metropolis. One firm, Elm Partners, an funding agency beforehand primarily based in London, is now relocating to the metropolis.
Denver additionally mentioned it acquired “significant” curiosity following public launch of the quick checklist, in line with a spokesperson for Metro Denver Economic Development Corp., the non-public group spearheading its HQ2 efforts. Denver didn’t reveal the incentives it provided.
Even cities similar to Arlington, Texas, which are no longer in the running hope the publicity round HQ2 will generate curiosity in its proposal web site. Arlington provided as much as 1.7 million sq. toes at Globe Life Park — house to the Texas Rangers baseball staff, which is transferring to a different stadium — to host its new places of work. The metropolis submitted a proposal as a part of Dallas-Forth Worth’s bid for the facility. (Dallas-Forth Worth stays a candidate).
“We are open for business and look forward to other great companies that want to take a look at Arlington,” mentioned Mayor Jeff Williams.
However, some consultants warn the huge incentives provided to Amazon might set a troubling precedent for future initiatives.
“For many of us studying economic development, we were shocked by the responses of cities to Amazon HQ2 — both in the lack of transparency and the willingness to give massive incentive packages,” mentioned Jensen. “I worry that the economic development incentives being offered to Amazon HQ2 could be the new norm for some of these communities.”
He added metropolis or state ought to be cautious to not give so many tax advantages away that it hurts the group in different methods. To pay for native tax cuts, cities could have to boost taxes elsewhere or slash spending on public companies like schooling and infrastructure.
“This strategy of [cities] chasing the mega-deals is flashy and can allow politicians to take credit for economic development, but it shouldn’t be the primary goal of economic development,” Jensen mentioned.
CNNMoney (New York) First printed May 17, 2018: three:15 PM ET