National Post (National Edition)
Amazon HQ2 seen as destiny saviour
Neighbourhoods sense a blank canvas to create
Emerging from the Crystal City Metro station in Arlington, Va., the state of the local property market is etched in bold colours on tarps draped over vacant office towers.
The vivid shapes, a contrast to the neighbourhood’s bureaucratic 1960s architecture, are a signal flare to future tenants sent up by the buildings’ owner. Locals assume the banners are aimed at catching the attention of Amazon.com Inc., on a yearlong, nationwide quest for a second headquarters. And they may have worked.
Seattle-based Amazon is close to agreements that would split a planned second headquartersforthee-commerce giant between Crystal City and Long Island City, in the New York borough of Queens, people familiar with the search said.
“Crystal City and Long Island City are really good parallel neighbourhoods,” said Jenny Schuetz, a fellow at the Brookings Institution’s Metropolitan Policy Program. “They don’t have a lot of charm or identity, but it will be relatively easy for Amazon toputitsstamponthem.”
Like Crystal City, Long Island City is a neighbourhood looking to change its destiny. While Crystal City is intent on replacing lost government tenants, Long Island City is struggling with a different problem. Its breakneckresidentialgrowthhas outpaced its school, transportation and sewer systems.
Queens is New York City’s most-diverse borough and its second-biggest by population, with about 2.4 million people, making it larger than 15 U.S. states. Long Island City has an abundance of high-end housing and it has the country’s largest public housing project.
The western edge of Queens has been reinventing itself for years, attracting biotech investments, film studios and shorefront developments.
“We can see Cornell Tech, life sciences, Amazon converging upon Long Island City as a creative centre in which all of these people intermingle in a new space for this century,” said Alan Suna, chief executive officer of Silvercup Studios, which counts Amazon’s TV programming as a client. “There’s a lot of space for new buildings that can accommodate this new technology.”
The east bank of the East River, now lined with residential towers with pan- oramic views of Manhattan, was once dominated by warehouses and factories. Its transformationbeganinthe early 2000s with the first of a series of rezonings.
“The Department of City Planning thought this was going to be artists and singles and it turned into every family in Manhattan who just had their first kid,” said Brent O’leary, president of the Hunters Point Civic Association. “We welcome Amazon, we need the jobs. But we really need help with the infrastructure.”
New York Mayor Bill de Blasio last week announced the neighbourhood will get a Us$180-million infusion of capital to build and improve schools, streets and parks.
“New York is Amazon’s most important market, and thisissomeplacewherethey want to build their presence,” said Kathryn Wylde, CEO of the non-profit Partnership for New York City. “Buttheyalsowanttomaximize their influence on the federal government as the federal legal and regulatory environment becomes more intrusive in their business, so it makes a lot of sense for them to be in Washington.”
Arlington, with a population of about 235,000, is a prosperous commuter suburb. Its Crystal City neighbourhood is just across the Potomac River from Capitol Hill in Washington by car ormetro,andaquickjaunt from Ronald Reagan Washington National Airport and the Pentagon.
Once a home to junkyards and motels, the area was developed during the 1960s amid an increase in demand for office space. During its heyday, Crystal City attracted big-name government tenants, but it never fully recovered after some agencies moved out.
The U.S. Patent and Trademark Office completed its exit in 2005, and many U.S. Department of Defense workers left as part of the federal Base Realignment and Closure process that began that same year.
Theexoduslefttheneighbourhood with relatively cheap, aging office buildings that could be used by Amazon while the e-commerce giant renovates existing properties or builds anew. The office vacancy rate in Arlington County, where Crystal City is located, was about 18 per cent as of the third quarter of 2017.
“Everyone’s excited because if Amazon’s coming in, that means there’s going to be more jobs, pay is probably going to go up,” said Andrew Chang, CEO of Eastern Foundry, a co-working space for government contractors in Crystal City. “One thing that is worrying people from a business-owner standpoint, especially in the government sector and the tech sector, is how are you going to compete against Amazon for talent?”
MAKES A LOT OF SENSE FOR THEMTOBEIN WASHINGTON.