- Amazon has announced that its second headquarters, known as HQ2, will be split between two locations: the National Landing area of Arlington, Virginia, and Long Island City, Queens.
- The company is on the hunt for either an existing building or new development, which will likely span 4 million square feet and cost around $US2.5 billion over the next 15 to 17 years.
- Business Insider caught up with a few real estate experts, who shared their predictions for the future headquarters.
The wait is over: Amazon has officially announced the winners of its search for a second North American headquarters. The two locations – the National Landing area of Arlington, Virginia, and Long Island City, Queens – are each expected to receive around 25,000 new employees and $US25 billion in economic investment.
The company also announced that Nashville will receive a new operations center, complete with a $US230 million investment and 5,000 additional jobs.
Prior to the announcement, Amazon floated a few requirements for the “campus or park” that would house its future headquarters: a 100-acre greenfield site, an existing building with at least 500,000 square feet of real estate, an infill site, or some combination of these choices. The company also expressed a desire for extensive transit options nearby.
The final project, they estimated, would span around 8 million square feet and cost around $US5 billion. Those requirements are now likely to be divided between two locations.
“Even with the stratospheric prices of New York City real estate, $US2.5 billion can achieve some remarkable results,” said Constantine Valhouli, the head of research for Neighbourhood X. As an example, he pointed to Google’s Chelsea Market building, which cost the company $US2.4 billion.
“That money goes considerably further in Queens,” he said.
Though Amazon has allotted 15 to 17 years for the initial phase of development, reports have indicated that the company wants a move-in ready site within a year.
In its request for proposal, Amazon said it would “prioritise certified or shovel-ready greenfield sites and infill opportunities,” which could be built to meet its specifications. But an existing building could make it easier to stick with its timeline.
“Unless the terms of any arrangement with the city included expedited permitting and a bypass of parts of the review process, it is unlikely to have a skyscraper or tech campus built within a year, from the ground up,” Valhouli told Business Insider. Then again, he said, “Things could theoretically work a lot faster when money isn’t an object.”
We asked a few real estate experts to share their predictions for where the company might locate in Long Island City.
One Court Square
One Court Square is perhaps the likeliest choice for Amazon’s new headquarters. The 50-story office tower is slowly being vacated by Citigroup, which has decided to give up one million square feet of office space – far more than Amazon’s initial requirement.
Valhouli said the building was the “natural choice” for Amazon, given its “visibility and symbolic value.” As the tallest building in Queens, One Court Square is clearly identifiable from Manhattan along the East River. The fact that Amazon would replace Citigroup might also represent the increasing dominance in the city of technology firms over financial services groups.
Earlier this month, the Wall Street Journal reported that the owner, Savannah, was already in talks with Amazon about leasing its vacant space to the retail giant.
In May, New York City announced an estimated $US10 billion plan to start developing in Sunnyside, a middle-class neighbourhood in the Western portion of Queens. The new development would span around 180 acres and include 19 schools, 52 acres of public parks, and up to 24,000 homes.
The year prior, the city conducted a feasibility study that found it was possible to build decking over the Sunnyside Railyards, which are owned by Amtrak and used by New Jersey Transit. The future development has drawn comparisons to Hudson Yards, a $US25 billion neighbourhood near the Eastern and Western Rail Yards in Manhattan.
According to Valhouli, something similar could be possible in Queens, but would be difficult to accomplish within Amazon’s one-year timeline.
Hunter’s Point South
Waterfront sites have become increasingly popular among the tech community, with Boston locating its Seaport Innovation District along the South Boston Waterfront and Footpath Labs planning to build its Quayside neighbourhood along the eastern waterfront in Toronto.
Long Island City is in the midst of developing its own waterfront megaproject in Hunter’s Point South, which features 11 acres of green space. The site is also set to receive 1,120 new apartments, a 600-seat elementary school, and 40,000 square feet of retail and community space.
These amenities are bound to be attractive to Amazon, which has expressed a desire to locate in an area “where our employees will enjoy living, recreational opportunities, educational opportunities, and an overall high quality of life.”
To the north of Hunter’s Point is the Anable Basin, an artificial inlet that separates Brooklyn from Queens. In 2017, the developer TF Cornerstone proposed a $US925 million mixed-use development in the area, which would include 400,000 square feet of office space.
Plaxall Realty has also put forward a plan for a 15-acre waterfront neighbourhood in Anable Basin featuring nearly 1.5 million square feet of office, retail, arts, and cultural space.
Days before the Amazon announcement, Politico reported that the company was considering the Anable Basin as a potential HQ2 site, citing sources familiar with the plan.
Valhouli said the proposed rezoning of the land could make it a strong contender, though the development would likely exceed Amazon’s timeline.
Newtown Creek/Dutch Kills
“The area of Newtown Creek in Long Island City could potentially be a perfect fit for a company giant such as Amazon,” said Jessica Meis, a local real estate agent at Compass.
Though it’s currently an industrial wasteland, Newtown Creek is the subject of a new revitalization plan that would bring more green space and public amenities to the 11-mile waterway. The neighbourhood is located within blocks of the Long Island Rail Road and the East River Ferry system, giving it easy access to Manhattan.
Meis said the area “would be able to provide Amazon with the massive space needed to grow its operations.”
As far as available land goes, her colleague, Christina DeCurtis, pointed specifically to Dutch Kills, a working-class community with lots of underutilized warehouse and commercial space.
There’s just one problem with the choice: Newtown Creek has been named a Superfund site by the EPA, meaning its hazardous contamination poses a risk to human health. That could be a deterrent for Amazon, which is committed to sustainable building.
Wherever the company decides to locate, there are plenty of options in Long Island City.
“What falls under the Long Island City umbrella is actually quite wide and varied,” said DeCurtis. “[Amazon] could even go more north bordering Astoria, where there is so much potential.”