Or­ange Crush

Why Van­cou­ver could be a strong con­tender to land Ama­zon’s se­cond head­quar­ters by Scott Neufeld

BC Business Magazine - - Leadership -

With just one click, Ama­zon.com Inc.'s re­quest for pro­pos­als for a new head­quar­ters trig­gered what may be the big­gest cor­po­rate re­lo­ca­tion lot­tery in his­tory.

At press time, Van­cou­ver and more than 100 other Canadian and U.S. cities were vy­ing for the cov­eted prize. The Seat­tle-based re­tail gi­ant will an­nounce the lucky win­ner next year. With its high hous­ing costs and tight land sup­ply, what are Ter­mi­nal City's chances of play­ing host to an 8.1-mil­lion-square-foot HQ teem­ing with some 50,000 em­ploy­ees?

Ex­perts point out that homes are ex­pen­sive in most of the ar­eas favoured by tech com­pa­nies, in­clud­ing Seat­tle and Sil­i­con Val­ley, so this fac­tor doesn't nec­es­sar­ily knock Van­cou­ver out of con­tention. On the plus side, the city of­fers work-life bal­ance, with out­door re­cre­ation and a vi­brant down­town. “From purely a cul­tural and cool fac­tor, Van­cou­ver def­i­nitely meets the re­quire­ments,” says Glenn Gard­ner, prin­ci­pal at Avi­son Young Prop­erty Man­age­ment (BC) Inc. “It has ev­ery­thing that a trendy tech­nol­ogy com­pany would be look­ing for.”

Add Canadian sell­ing points like mul­ti­cul­tur­al­ism and gov­ern­ment-funded health care, and Van­cou­ver could have a sig­nif­i­cant edge on U.S. ri­vals. Ama­zon has 5,000 open­ings for soft­ware devel­op­ers, ac­cord­ing to com­mer­cial real es­tate firm Col­liers In­ter­na­tional. “You're not go­ing to fill that im­me­di­ately any­where so be­ing able to source glob­ally is prob­a­bly a very im­por­tant is­sue,” says Craig Hen­ni­gar, di­rec­tor of mar­ket in­tel­li­gence, Canada, with Col­liers, adding that Van­cou­ver's open­ness to im­mi­gra­tion is at­trac­tive.

Al­though cur­rency ex­change dif­fer­ences could re­duce the com­pany's costs, one of the big­gest sav­ings for busi­nesses in Canada is on health care. “There's huge is­sues in the United States for health cov­er­age— gov­ern­ment health care just isn't there for the masses like it is here,” notes An­thony Ari­g­anello, pres­i­dent and CEO of Char­tered Pro­fes­sion­als in Hu­man Re­sources B.C. & Yukon.

An­other po­ten­tial Van­cou­ver ad­van­tage: its work cul­ture closely matches Seat­tle's. Hen­ni­gar says this could be a prob­lem if Ama­zon is try­ing to make its ranks more di­verse, which some spec­u­late may be the rea­son be­hind the new HQ. But Ari­g­anello sees it as a pos­i­tive for Van­cou­ver, cit­ing the dis­as­trous merger of U.S. Chrysler Corp. and Daim­ler-benz AG. This odd-cou­ple tie-up of a U.S. and a Ger­man au­tomaker with two dif­fer­ent styles went sour af­ter nine years. It would be a huge cul­ture shock for Ama­zon to train thou­sands of new staff in a lo­ca­tion that isn't in tune with West Coast cul­ture, Ari­g­anello ar­gues. “If you don't have the right em­ployee cul­ture, and par­tic­u­larly if the cul­ture isn't right, you're doomed to fail.”

Among the ob­sta­cles for Van­cou­ver is find­ing a suitable site. Al­though there are some in the re­gion (see be­low), mu­nic­i­pal gov­ern­ments would need to al­low sig­nif­i­cant den­sity. The en­tire down­town core has only about 22 mil­lion square feet of of­fice space.

With no other head­quar­ters of com­pa­ra­ble size, Ama­zon could make its mark on Van­cou­ver. “The ques­tion is what kind of strain that might put on other tech firms to lose em­ploy­ees,” Hen­ni­gar says. “In a city like Van­cou­ver, it al­most be­comes like a black hole.”

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