It’s a tale that really is as old as time — if you want the best deal, start playing your suitors off of each other. That’s what Amazon seems to be doing this week, announcing their plans to build a second corporate headquarters and telling North American cities to start sending in bids.
In their announcement, Amazon revealed their intent to build another headquarters in North America, in which they plan to invest $5 billion. The number that will really excite cities? They plan to add as many as 50,000 (“high-paying”, to quote Amazon) jobs to its workforce, something that could be a huge boon for whichever city wins out.
Amazon is encouraging bids in part by showing off what they’ve brought to Seattle. In addition to jobs, Amazon points out they’ve invested $3.7 billion in their Seattle HQ, paying out $25.7 billion to employees. There are also the added bonuses, like $43 million going into Seattle’s public transportation system by way of transportation benefits Amazon provides to employees. That’s to say nothing of the other tech companies Amazon has drawn to Seattle by virtue of their scale.
It’s a convincing argument — now Amazon wants cities to make convincing arguments of their own. Amazon explains their decision to make the decision public by saying they “want to find a city that is excited to work with us and where our customers, employees, and the community can all benefit.” Fair enough, but they’re undoubtedly looking for cities to sweeten the pot, too. After all, for as big as Amazon is, it beggars belief that they don’t already have a pretty good idea of where they’d like to set up shop — they know which cities have good universities, and they know where the low tax rates are. As others have already argued, they’re probably looking for cities to make the process easier, either through tax breaks or by smoothing over the permit process.
By pitting cities against each other publicly, Amazon is all but guaranteeing themselves the best deal — it almost makes you wonder why more companies don’t do it. The answer might be that few companies are as big as Amazon, and even then, few of those large companies elect to open up a whole second headquarters as opposed to smaller regional offices. It’s an odd move in that respect, but it’s one that, in my best sweepstakes promoter voice, one lucky city could benefit from.