Roiled New York­ers force Ama­zon’s with­drawal

Vir­ginia head­quar­ters still on sched­ule


On Valen­tine’s Day, Ama­zon broke up with New York City and turned all of its at­ten­tion to North­ern Vir­ginia, an­nounc­ing it would not set up half of its se­cond head­quar­ters in Queens and would move ahead with its plans for Crys­tal City.

“Af­ter speak­ing with Ama­zon rep­re­sen­ta­tives ear­lier this day, we are mov­ing for­ward as we had planned,” Chris­tian Dorsey, chair­man of the Ar­ling­ton County Board of Su­per­vi­sors, told re­porters in a con­fer­ence call hours af­ter the an­nounce­ment. “Noth­ing has changed.”

Mr. Dorsey said Ama­zon’s plans to nix a site in Long Is­land City will re­sult in

no new agree­ments, in­cen­tives or ad­di­tional jobs for “Na­tional Land­ing,” the fu­ture home of the on­line re­tail gi­ant’s 4-mil­lion-square-foot HQ2 — a nest of un­der­used of­fice build­ings in Ar­ling­ton, Pen­tagon City and Crys­tal City along the Po­tomac River.

How­ever, the county of­fi­cial said there is a pos­si­bil­ity that Ama­zon might ex­ceed its first-phase goal of adding 25,000 high-pay­ing jobs in North­ern Vir­ginia and top out at its se­cond-phase goal of 37,850 jobs.

“We’re a lot closer to get to 50 [per­cent boost],” Mr. Dorsey said.

In a state­ment Thurs­day, Ama­zon said that out­rage from elected of­fi­cials had roiled the New York project. The Seat­tle-based re­tailer had promised to build 25,000 jobs and in­vest $2.5 bil­lion de­vel­op­ment of water­front prop­erty in Queens in ex­change for nearly $3 bil­lion in state and lo­cal tax breaks.

Crit­i­cism of the Ama­zon plan has cooled in Vir­ginia, how­ever.

“The in­ten­si­fi­ca­tion in Crys­tal City is not go­ing to be what it was [in Long Is­land City],” said Jeannette Chap­man, deputy di­rec­tor of The Stephen S. Fuller In­sti­tute who re­searches eco­nomic de­vel­op­ment in the Wash­ing­ton, D.C. re­gion., “We’re just fill­ing up build­ings that had been full be­fore.”

The Na­tional Land­ing site has had high of­fice va­cancy since the Base Re­align­ment and Clo­sure in the mid-2000s that saw many Pen­tagon work­ers and de­fense con­trac­tor exit the area.

“Per­son­ally, I think it’s a re­lief to know Ama­zon finds Vir­ginia to be wel­com­ing to them,” said Chris­tine Richard­son, a North­ern Vir­ginia Re­al­tor who has seen a strong hous­ing mar­ket boosted, in part, by Ama­zon’s an­nounce­ment of its expansion plans in Novem­ber.

The Vir­ginia foot­print of Ama­zon’s head­quar­ters has in­cluded the prospect of 25,000 high-pay­ing tech jobs and an in­vest­ment of $2.5 bil­lion, in­clud­ing the de­vel­op­ment of an in­no­va­tion cam­pus through Vir­ginia Tech. Gov. Ralph Northam signed a $753 mil­lion in­cen­tive pack­age into law ear­lier this month. Ar­ling­ton County will pro­vide a cash grant of $23 mil­lion over 15 years, funded by an in­crease in the county’s ho­tel tax.

“We are ex­cited that Ama­zon’s plans for Vir­ginia re­main in place and that we can con­tinue work­ing to­gether to po­si­tion Vir­ginia’s dy­namic tech sec­tor for healthy, sus­tained, statewide growth,” said Stephen Moret, pres­i­dent of the Vir­ginia Eco­nomic De­vel­op­ment Part­ner­ship.

Still, Ama­zon’s an­nounce­ment caught Vir­ginia of­fi­cials off-guard. A spokesman for the mayor of Alexan­dria said he was unaware of any­one in the of­fice re­ceiv­ing ad­vance no­tice of Ama­zon’s de­ci­sion. And the specter of a fickle cor­po­rate part­ner could rat­tle lo­cal as­sur­ances.

Ama­zon has a track record of pun­ish­ing lo­cal govern­ments when it doesn’t get its way, crit­ics say. For ex­am­ple, the com­pany last year halted con­struc­tion on a tower in Seat­tle many saw as a protest of the city board as they con­sid­ered in­creas­ing taxes on high-earn­ing busi­nesses.

Mr. Dorsey said Ar­ling­ton County is stand­ing by its part­ner, at least for now.

“I think it re­mains to be seen whether this is an ex­am­ple of, ‘If we don’t get our way, we’ll take our ball and go home,’” he said. “Ev­ery­thing we’ve of­fered so far, Ama­zon has leaned in and em­braced. One thing we’ve been clear about from the very be­gin­ning [is that] we think this fits within our ex­ist­ing plans and our ex­ist­ing val­ues.”

Mr. Dorsey said any changes in Ama­zon’s pos­ture would cre­ate a “com­pletely dif­fer­ent con­ver­sa­tion.” He stressed that the county has not pro­vided any money up­front and its pay­ment is con­tin­gent upon Ama­zon ac­tu­ally cre­at­ing jobs and mov­ing into of­fice space in Na­tional Land­ing.

“We only de­liver pay­ments af­ter per­for­mance has been re­al­ized,” said Mr. Dorsey.

There is only spec­u­la­tion about the 25,000 jobs that Ama­zon had promised for New York City.

“We do not in­tend to re­open the HQ2 search at this time,” the com­pany said Thurs­day. “We will proceed as planned in North­ern Vir­ginia and Nashville, and we will con­tinue to hire and grow across our 17 cor­po­rate of­fices and tech hubs in the U.S. and Canada.”

In ad­di­tion to its HQ2 plans, Ama­zon had an­nounced in Novem­ber an Oper­a­tions Cen­ter of Ex­cel­lence in Nashville, Ten­nessee, that will cre­ate 5,000 jobs.

Ar­ling­ton County does not in­tend to court those other jobs.

“We’re com­fort­able with that, and we’re not go­ing to make a play for any­more,” Mr. Dorsey told re­porters.

Ama­zon’s change of heart was a se­ri­ous blow to New York Gov. An­drew Cuomo and New York Mayor Bill de Bla­sio, who had lob­bied in­tensely to land the project, com­pet­ing against more than 200 other metropoli­tan ar­eas across the con­ti­nent that were prac­ti­cally trip­ping over each other to of­fer in­cen­tives to Ama­zon in a bid­ding war the com­pany stoked.

Mr. Cuomo lashed out at fel­low New York politi­cians over Ama­zon’s change of heart, say­ing the project would have helped di­ver­sify the city’s econ­omy, ce­ment its sta­tus as an emerg­ing tech hub and gen­er­ate money for schools, hous­ing and tran­sit.

“A small group of politi­cians put their own nar­row po­lit­i­cal in­ter­ests above their com­mu­nity,” he said.

Last month, a New York state legislator crit­i­cal of Ama­zon was ap­pointed to a board with veto power over the New York project. And the con­gress­woman for the district hous­ing the now-aborted head­quar­ters in Queens — Rep. Alexan­dra Oca­sio-Cortez — had been a vo­cal critic of the deal since its an­nounce­ment in early Novem­ber.

On Thurs­day, Ms. Oca­sio-Cortez tweeted, “Any­thing is pos­si­ble: to­day was the day a group of ded­i­cated, ev­ery­day New York­ers and their neigh­bors de­feated Ama­zon’s cor­po­rate greed, its worker ex­ploita­tion, and the power of the rich­est man in the world.”

● This ar­ti­cle is based in part on wire ser­vice re­ports.


NOT A MATCH: On Thurs­day, Ama­zon and New York scrapped plans to set up half of the re­tail gi­ant’s se­cond head­quar­ters in Long Is­land City. Plans re­main un­changed for the head­quar­ters in Vir­ginia.

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