- Amazon is on the hunt for a home for its second headquarters.
- The company has received hundreds of bids, in part because it could be worth several billion dollars to the winning city.
- Amazon has spent close to $US2 billion on buildings in Seattle, according to a new study from BuildingZoom.
Amazon might as well be hosting a reality game show.
After the company announced it was seeking a home for its second headquarters, cities across the US jockeyed for their shot at winning the e-commerce giant’s favour. Apparently, it’s for a good reason.
The winning city could see a more than $US1.9 billion windfall from Amazon’s new headquarters, dubbed “HQ2,” according to a new study performed by BuildZoom’s Sasha David.
By studying the building permits Amazon filed in Seattle, David found that Amazon has spent at least $US1.92 billion on construction and lease upgrades in downtown Seattle. That figure doesn’t include any spending on furniture, fixtures, engineering or design work, David notes.
“[The number gathered from building permits] is the lower end of how much has gone into the construction of an Amazon-owned office property in Seattle to date. We can also expect this number to continue to rise, as three blocks are still in development,” David told Markets Insider in an email.
Amazon estimates it’s own total contribution to Seattle at $US38 billion from 2010 to 2016. The company said it has spent $US3.7 billion on buildings and infrastructure, and billions more through more indirect contributions.
Some locals might counter these benefits by saying the giant has also raised local home prices, lowered local diversity and worsened traffic in the area.
The perceived benefits outway the downsides for the 238 cities that have submitted a bid to be the home of HQ2. Amazon has said it plans to invest about $US5 billion in its new headquarters’ new home and bring tens of thousands of new jobs to the area.
“Amazon will likely reduce vacancy rates, crowd out other tenants, and drive up office rents, especially in the short run,” Issi Romem, chief economist at BuildZoom, said about the new home of HQ2. “In the longer run, Amazon will expand the office supply and, more generally, help deepen the talent pool.”
As they wait, cities across North America have submitted increasingly crazy bids to be the home of HQ2. The final verdict is expected to come sometime in 2018, according to Amazon. Until then, we get to watch the show.
Shares of Amazon are up 55.29% this year.
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