How Amazon chose HQ2 and moored 236 cities

A few weeks earlier, they impressed Amazon's site selection team at meetings that ended with entries to the Stomping Ground restaurant. Together, they drank beer, ate tiny chicken cookies, and sported a gay pride flag.

Then came the curveball. Amazon has confirmed the rumor about two cities in a phone call. What neither northern Virginia nor the other 20 finalists have understood is that Amazon officials had already determined, months before, that no city had the technical talent to accommodate projected growth of society, according to people close to the thinking of society.

On Tuesday, Amazon announced it would divide its headquarters between northern Virginia and Long Island, New York, while offering Nashville, Tennessee, the consolation prize of an operations center and the promise of 5,000 jobs.

What seemed to be a slap to the losers showed just how much Amazon's grip on a bunch of American cities. Some of the more than 200 candidates had invested hundreds of thousands of dollars to seduce society by promising that HQ2 would restructure their local economies.

Amazon launched its beauty contest in September 2017 to showcase the company's economic benefits. Finally, the contest revealed more about his immense power.

"Would it have been better to create 50,000 jobs? Of course, "said Alicia Glen, Housing and Economic Development Assistant in New York.

Stephen Moret, chief executive of the Virginia Economic Development Partnership, said that 25,000 well-paying jobs still constituted one of the largest economic development projects in US history.

The mayor of Dallas, who thought he was still in contention until recently, was informed by Amazon of his decision shortly before the public announcement.

"My heart is broken today," said Mayor Mike Rawlings at a press conference that looked more like a wake. The mayor of Nashville said he officially discovered the price of consolation by seeing Amazon's tweet on Tuesday.

Amazon left many cities in the dark for much of the selection process, which lasted about 14 months, frustrating some government officials. Seventeen finalists left empty handed, although they spent a collective fortune on proposals, data and site visits.

The public show drew comparisons with an uneven and dysfunctional relationship.

"They literally started a bidding war and these communities literally collapsed to see the headquarters located in their community," said Richard Florida, professor at the University of Toronto , which studies urban economic development.

This record of QG2's spectacular auction is based on interviews with dozens of city and state officials, developers and people familiar with the company's thinking.

Amazon made an unexpected announcement around 3 am on September 7, 2017: it would launch a public search for a second head office, which, according to general manager Jeff Bezos, would be "tied" to its headquarters located in Seattle.

The message was sent to the municipal leaders of North America when they woke up. Large business development projects can create a few thousand jobs. Amazon has promised 50,000 inhabitants, more than the population of about 96% of US cities. They would pay an average full-time salary of $ 100,000. Amazon announced that it would invest $ 5 billion in its second seat over two decades.

Seattle residents have called Amazon a "boom of prosperity". Since 2010, Amazon's workforce in Seattle has grown from 5,000 to 45,000 people. The company has spent more than $ 4 billion in approximately 40 offices in Seattle, helping to transform a dilapidated neighborhood of tire shops and small warehouses.

For Amazon, HQ2 was an advertising campaign for ages. Mr. Bezos was inspired in part by

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2014 looks for its $ 5 billion advanced battery plant. Nevada won by distributing tax incentives worth $ 1.3 billion.

His requirements were strict. Amazon wanted a metropolitan area of ​​over one million residents, thereby eliminating nearly 70 potential prospects in North America. She called for a stable and business-friendly environment, as well as an urban or suburban location that could attract the best technical talent. The company also wanted a place less than 45 minutes from an international airport, one or two miles from a major road and easy access to public transportation.

Cities large and small worked overtime on their applications. "We had daily meetings in the war room," said Brian Kenner, Deputy Mayor of Economic Development in Washington, DC. "We sometimes had them twice a day."

Dozens of cities that have not met all the requirements have nevertheless prepared their presentation, hoping to attract the attention of Amazon on a future project. Gary, Ind., 80,000 residents, purchased an advertisement in a newspaper containing a letter to Mr. Bezos, describing his qualities and offering "all the land you need." Lower Merrimack Valley, Massachusetts, sent a fake diamond ring with the proposal. : "We're going to be laughed."

For others, the costs seemed too high. "To give blindly to the farm is not our style," wrote San Antonio, responsible in an open letter to Mr. Bezos. Little Rock, Ark, flaunted a banner over Seattle on which it was written: "Hey, Amazon, it's not you, it's us."

Some government officials were unhappy about having to spend little time and money on a long-term offer. Other cities have spent hundreds of thousands of dollars on consultants. Luck was too seductive to resist.

By Amazon's deadline of October 19, the 238 proposals from Head Office 2 were housed in a large conference room at its Seattle headquarters. Amazon was silent for three months. He examined data such as the growth rate of the local market, the willingness of future employees to settle in each city, as well as the SAT scores of local high schools.

On January 18, 20 finalists were announced. They included a mix of predictable choices – New York, Boston and Chicago – as well as few wall flowers, including Indianapolis and Columbus, Ohio, cities with smaller airports, undeveloped public transport and less and less. technicians.

A surprise was the selection of three contenders in the metropolitan area of ​​Washington, DC. Some thought the solution was good because Mr. Bezos was both the owner of the local Washington Post newspaper and a second home. Holly Sullivan, the Amazon executive at the helm of the effort, was the former economic director of Montgomery County, Maryland, one of QG2's finalists.

Among those who have not been invited to dance are Detroit and Orlando, Florida. Ms. Sullivan told the officials that they did not have enough technicians. "Talent is a huge problem at the national level," Sullivan told Khalil Rahal, executive director of the group that ran the Detroit bid.

Rahal said Ms. Sullivan had told her that most US cities were lagging behind. "There is really no place in the country that can fill its 50,000 people," Rahal said.

From this moment of the contest, Amazon imposed a strict silence. Some officials have learned that other cities have been hunted early because of leaks. Indianapolis, one of the finalists, asked about 400 people to sign confidentiality agreements.

At this point, Amazon asked cities what they wanted in return. The requests included ideas for limiting house prices, support for more STEM education in schools, and mandatory volunteer work for Amazon employees.

Amazon then asked each city to schedule a visit from company officials within 48 hours. Almost no education was given to the cities, apart from organizing education and talent sessions, as well as site visits.

In Los Angeles, Amazon officials told officials Tuesday that their visit would be scheduled the following Monday. Local officials had to juggle a major clean tech conference scheduled that day, as Amazon officials insisted they could not change their plans.

The message was clear: Amazon had to have priority.

In June, Amazon sent a letter stating that they were still evaluating the finalists. Some cities, such as Raleigh, NC, have never had news, having organized a breakfast in March at the Governor's Mansion and a dinner at the Death and Taxes restaurant.

But Amazon's team of about eight people traveled to New York and the Washington, DC area on several occasions.

The July meeting of 30 Northern Virginia officials, Crystal City developers and the Amazon team at Stomping Ground was top secret. The owner and chef Nicole Jones was asked to prepare the buffet, hand in the keys and leave.

In the same month, the New York City Economic Development Corporation invited representatives from 11 colleges and universities in the region to meet with Amazon executives to demonstrate that they had the necessary talent.

In August, some city officials realized that Amazon was changing its ambitions. During a second visit to Los Angeles, a city official asked if Amazon should divide its headquarters between several cities because there was not enough technology talent on a site. Mrs. Sullivan and her staff glanced at each other.

Inside Amazon, the team had determined, after the first site visits at the beginning of the year, that no city would meet its needs.

Amazon made another trip to New York in September, when its leaders met with city officials to visit Long Island City. The Citi Bikes boarded a New York ferry and went on a sunset cruise.

Steven Fulop, Mayor of Jersey City, New Jersey, of Manhattan, on the other side of the Hudson River, had his own opinions on the contest. His city came in but was not a finalist.

Amazon "used their brand to not have a social impact," he said. "They used it to pit one community against another and everyone cracked it. We included.

-Scott Calvert, Tawnell D. Hobbs. Keiko Morris and Katie Honan contributed to this article.