Bay Area cities ally in bid for Amazon HQ
San Francisco, Concord, Fremont, Oakland and Richmond have included sites in the proposal
A coalition of Bay Area cities is bidding to bring Amazon’s second corporate headquarters to the region.
Concord, Fremont, Oakland, Richmond and San Francisco worked together to submit a bid offering sites in each of those cities for Amazon’s second corporate headquarters, which the e- commerce giant announced it was shopping for in September.
“The Bay Area offers the whole package and is a natural and perfect fit for an innovation leader like Amazon,” said Jim Wunder- man, president and CEO of the Bay Area Council, which helped the cities coordinate their bid, in a statement. “We are the world’s innovation capital. We offer top talent, top universities and large development sites connected by a rich network of mass transit and other transportation systems. Our competitive advantages are unparalleled, including our strong connections to the huge Asia-Pacific region.”
San Jose submitted a separate bid for the second Amazon headquarters, touting its size as the Bay Area’s largest city with a population of more than 1 million, easy traveling options, talented young workers, housing opportunities and sunny weather.
“Amazon’s success has come from seeing a need and filling it— fromonline book sales to competitive pricing on bananas to cloud computing,” wrote Kim Walesh, San Jose’s economic development director, in a letter to the company’s headquarters in Seattle. “We hope that you’ll agree that our city can readily fill the site location needs you have articulated.”
The coalition proposal offers sites including the former Concord Naval Weapons Station that Concord officials have been planning to transform into a transit-oriented development with 6 million square feet of office and commercial space, 120 acres for a research or academic campus and 12,000 housing units. It also includes Coliseum City and numerous downtown locations in Oakland, the Warm Springs Innovation District in Fremont, Hunter’s Point Shipyard in San Francisco and the Richmond Field Station and Hilltop Mall in Richmond.
The proposal also included “secondary sites” for Amazon’s consideration that include locations in the cities of Pittsburg and Union City.
The bid lays out the assets of each of those sites, promising to meet the requirements laid out in Amazon’s request for proposals — including 8 million square feet of building space and proximity to major roads, public transit and a metropolitan area with more than 1 million people.
San Jose suggested South San Jose, Downtown San Jose and North San Jose, which Walesh called the city’s “innovation district with ample capacity” and easy access to light rail and a future BART station.
San Jose didnot offer taxpayer subsidies to attract the online retail giant. Mayor Sam Liccardo wrote an oped in The Wall Street Journal on Oct. 4 saying that large corporate subsidies have become “a relic of the past” for San Jose.
“Some 95 percent of Silicon Valley’s job growth comes from new small-business formation and when those homegrown companies develop into larger firms,” Liccardo wrote.
“We’d love to have them here, but we aren’t willing to give subsidies,” said Councilman Johnny Khamis. “We think the merits of doing business in San Jose speak for themselves without subsidies. I think we make the best case becausewe have an international airport, public transportation and several universities — so we have a lot of talent.”
The prospect of an Amazon campus could stoke fears about its potential impact on the already crunched Bay Area housing market.
Housing site Apartment List found that the flood of Amazon employees to Seattle has coincided with rent increases that surpass the rates of almost all other U.S. cities and the fastest growth rate nationwide in home prices. The company studied the impact on rents in 15 metros bidding for Amazon’s second headquarters and predicts an additional annual rent increase of up to 2 percent per year in addition to the rent growth those metros would experience without the addition of the Amazon campus.
The proposal from the Bay Area cities does include a combined 45,000 units of newhousing that cities envision being built in the coming years, but it’s unclear if that will be enough.
“Our housing production has increased three-fold in just the past six years, and numerous residential development sites throughout the region envision adding tens of thousands of more units in the next five to 10 years,” Wunderman said in the news release from Bay Area Council.
The Bay Area will have to contend with other cities across the country bidding for Amazon’s headquarters, and city and state leaders are going to great lengths to attract the tech giant, offering financial incentives to attract them.
Gov. Jerry Brown is offering hundreds of millions of dollars in tax breaks and other incentives if Amazon chooses California as the site of its second home. Some of those perks include up to $200 million over five years under the California Competes Tax Credit program, up to $100 million over 10 years in employment training funds, and streamlined permitting and approvals.
Stacy Mitchell, co- director of the Institute for Local Self-Reliance, was skeptical that winning Amazon’s bid would be all good for local economies.
A November 2016 report fromthe institute found that between 2005 and 2014, half of Amazon’s new fulfillment centers received public incentives totaling $613 mil- lion, and the company received another $147 million in subsidies connected to its data centers during these years.
“Over the last decade, as Amazon has mastered this strategy, it’s come to employ site-location experts and lobbyists in its efforts to pit local and state governments against each other for the largest subsidy package,” Mitchell said in a statement issued on the institute’s website. “Our analysis finds that as Amazon grows, it’s in fact destroying far more jobs than it’s creating. It’s also beginning to threaten the revenue streams on which local governments rely, as shuttered stores depress commercial property tax values. In response to Amazon’s (headquarters request), public officials would do well to invest in smart economic development for their communities instead of engaging in Amazon’s arms race.”