Whither Amazon HQ2?
As you have seen if you read pretty much any mainstream US news source, Amazon recently announced that it would be building a second headquarters (HQ2) in North America. Pretty much every city of any size in the country has announced they’ll be preparing a proposal. One of my friends in Texas asserts that it’s a farce: that Amazon already picked Denver and is going through the motions to extract better incentive payments. Out of curiosity, I downloaded the request for proposals and the accompanying press release. I can see why my friend has her opinion.
The RFP included four major requirements for the site:
- A million-person metro area within 30 miles;
- An international airport within 45 minutes;
- Major highways and arterial roads within 1-2 miles; and
- At-site access to mass transit (described as “direct access to rail, train, subway/metro, bus routes”).
There are a number of things more vaguely described: a demonstrated ability to attract tech talent (software development in particular); communication and transportation infrastructure; the usual “quality of schools” and “quality of life” things. Everyone looking to relocate asks for those. The press release makes it pretty clear that Amazon will be seeding HQ2 with people from Seattle, and that they anticipate people voluntarily moving between Seattle and HQ2 as opportunities arise. Before looking at those five in detail, consider the very short fuse for responding. Denver can pretty much go down the list and check things off, which is suggestive of stacking the deck. Now to the specific five.
The Denver-Aurora-Lakewood metropolitan statistical area has an estimated population of 2.8 million people (2015). The larger Denver-Aurora combined statistical area’s estimated population is 3.5 million (2016). The entire Front Range is growing at an unpleasantly high rate (for those of us who already live here), driving up housing costs and raising the oft-repeated question, “But where will the water come from?” [1]. Spread out over a period of several years, even Amazon’s high-end estimate of 50,000 new jobs at HQ2 isn’t that big an increase compared to the current growth rate.
Denver International Airport (DIA) is the sixth busiest airport in the United States (metro Denver is only 19th by population among MSAs). There is nonstop service to (not an exhaustive list) Tokyo, Seoul, London, and Frankfurt. There are multiple daily nonstop flights to all of the US cities Amazon lists in the RFP. For domestic travel by the C-level executives, there are three general aviation airports in the metro area that already handle a heavy load of corporate jets. (Caveat: I don’t know if Amazon flies corporate jets for their executives or not; if not yet, I expect they will when there are two headquarters.)
Highway and mass-transit site access depends, of course, on the specific site. One candidate site in Denver is the Northfield business park associated with the redevelopment of the former Stapleton airport. Northfield’s web site indicates 1.2M square feet of office and retail space has already been developed but they have parcels as large as 70 acres still available. Northfield is bounded on the south side by Interstate 70 and is served by the Central Park light rail station. From Central Park, it is 15 minutes to Union Station in lower downtown (LoDo) and 24 minutes to the main terminal at DIA. While Northfield seems to me to be an obvious site, there are other possibilities located near other light rail stations and the interstates [2].
Regions based on author’s cluster analysis of interstate move data.
Finally, there is the issue of initial and ongoing relocations. Most analyses I’ve read essentially ignore this. First, I think Amazon will choose a state that is similar to Washington in its politics: blue or blue-leaning. Some of the things that might be factors include Medicaid expansion, marijuana status, vote by mail, etc. If that’s an accurate assessment, it eliminates cities such as Austin or Atlanta or Raleigh or Salt Lake City. Second, I occasionally play with interstate and inter-county migration data published by the Internal Revenue Service. One of the things I do is basic cluster analysis, grouping states using a distance measurement based on the percent of population that relocates between states. One of the outputs from that is a partition of the 48 contiguous states into seven [3] regions, shown in the figure to the left. The partition can be loosely described as “people tend to move more between states within these regions than to or from states in a different region”. There are lots of possible explanations for why these particular regions emerge. Some of it might be that people don’t want to move long distances. Some of it might be Big Sort kinds of cultural things. Some of it is definitely due to border cities: eg, Ohio and Kentucky get grouped largely because of Cincinnati. If the question “Where are our existing executives and managers likely to be willing to move?” this regional consideration may be important.
So, is my friend wrong that the game is rigged? There are lots of arguments for different cities if Amazon is going to be altruistic: dropping up to 50,000 tech and business jobs into Detroit would be enormously beneficial to that city. There are arguments for various cities if my relocation considerations aren’t important. But which cities are in a better situation to put together a short-fuse proposal based on the RFP and press release than Denver?
[1] The 2016-2017 water year has been somewhat wetter than usual, but not excessively so. It is also the first year that Denver Water’s new downstream reservoirs, intended to meet water calls from holders of more senior rights without tapping the traditional reservoir system, have been in full operation. With only about seven weeks left in the water year, the traditional water reservoir system is at 97% of capacity. Between conservation and improved management capability, Denver Water certainly appears to be doing well despite the massive growth in the customer base since the last of the traditional water reservoirs was constructed.
[2] Just as another example, one of my bicycling routes that goes east takes me close to the Gold Strike rail station on the Denver-Arvada boundary (shown while still under construction in the link). Across the tracks from the station is at least a couple hundred acres of semi-blighted area. But, it’s 15 minutes by rail to LoDo and three miles straight south on two major roads to the Highlands, which include a couple of Denver’s trendy neighborhoods that are rapidly gentrifying. Certainly it’s a candidate if Amazon decides to take a longer view or do a “distributed” campus.
[3] Seven regions is the largest number of regions that can be used without the software putting any single state in its own region. If it matters, the last state assigned to a multi-state region is New Mexico. Cluster analysis is more art than science.
Image credits: Front page, Amazon headquarters, the Portland Press Herald. Region map, author’s own work.
Two reactions:
1. Detroit could probably give them the land for free and an open book on building permits. Would be, at minimum, great PR.
2. Doesn’t this also sound a lot like the outskirts of Chicago?Report
Doesn’t this also sound a lot like the outskirts of Chicago?
You tell me. All I really know about Chicago these days is that (a) it has somehow managed to lose population in recent times and (b) my sister has lived there for four years and still whines incessantly about the weather. And she moved there from Omaha, not exactly known for its pleasant climate.Report
I lived there for three years, and came away thinking that for 45-60 days a year it’s the best city in the United States, and for the balance its… nice that you can generally stay inside.
The place is flat/walkable, the people are nice, the culture is world-class (as is the comedy scene), the sports teams are good vibes, the mass transit is good, and it’s cheap-for-a-big-city.
It definitely has all four major requirements (O’Hare is not very different from Denver, there’s transit from there into the city (so if you sit in between somewhere you have both), tons of roads, mass transit, etc. It’s also not a culture that would be controversial for Seattle folks.Report
Virginia on the Silver Line… DC lobbying will be more valuable to them in the long term.
McArdle talks about the case for DC proper… but DC proper isn’t really needed… though picking DC would have potentially interesting implications. DC is a curious city, curiously run.Report
Bezos also already owns a house and a newspaper in the town.
There’s already a ready made tech sector workforce in the area, and a Virginia (Dem) governor and (Dem) NoVa county council members that are *way* to eager to grant corporate welfare – but I’d still be surprised if it were coming to dc.
What vexes me is the *size* of this ostensibly executive workforce at an ostensibly secondary location.
Google (natch) says that there are 341,000 current amazon employees. That’s up 100k just over the last year, so there expanding superfast.
But still 50k ‘management’ is one big boss* or REMF (of one kind or another) for every seven people. That’s a lot of management overhead, and doesn’t even include the very top of the pyramid.
*i.e. not including 1st line supervisors, where a 1:7 ratio is eminently reasonable.
Eta – these are also pre Whole foods numbersReport
I have seen a similar argument made for Baltimore, or some place along the DC-Baltimore corridor, with a somewhat less outrageous cost of living being what is supposed to close the deal. I am skeptical. But then again I am skeptical of every other candidate as well. Whoever comes up with the most scratch, I expect.Report
I think it would be great for Baltimore – the inner harbor area would be lovely; but one of the consistent complaints from my Baltimore tech clients is that they can’t get good high-level tech staff to work in Baltimore.
Of course, adding Amazon would probably self-correct that problem for everyone.
The other issue w/Baltimore is public transportation… outside of Amtrak and BWI its a bit bleak… even getting to DC and environs is a pita unless aforementioned Amtrak.
All that said, I have absolutely no idea where they are going. 🙂 But the more I look at it, I hope they go somewhere like Baltimore or Charleston, WV or Mobile or Detroit… they don’t need a network effect, they are a network effect.Report
Within limits, I expect this is the case. The limits don’t extend to, say, Topeka, but Baltimore is actually a perfectly reasonable place to live, per modern techie criteria apart from already being a tech center.
As for public transit, it is decidedly spotty. Baltimore has one light rail line and one subway line. They work fine, if they are where you happen to be. I used to commute daily on the subway line with no problem. The bus system is only OK, and that by the low bar of American bus systems. There also are a couple of full gauge commuter rail lines on legacy tracks. They are a reasonable way to get to DC if you don’t want to pay Amtrak prices.Report
Amazon Detroit.
April: “It’s my first day on the job and this is great. Spring has sprung and I’m excited to be here! I got a really awesome house less than an hour’s drive from HQ for less than $200,000 and it’s on an ACRE!”
May: “I can’t believe all of the amenities this place has to offer. I’ve got Tigers games to go to, Red Wings games, Piston games, Lions games… Cedar Point *AND* King’s Island are a hop, skip, and a jump down the road, I’ve got lakes around me… this is going to be the best summer ever!”
June: “This ‘Coney Island Hot Dog’ thing is amazing. How does Michigan have Coney places like other cities have Starbucks? Seattle should have this many Coney places!
July: “These mosquitos are larger than I am used to.”
August: “I learned in high school that air could only get so humid before it was saturated and could not get any more humid. Like there was a hard limit. They also said that, above a certain temperature, this limit went *DOWN*. I wonder what else my teachers lied to me about?”
September: Holy cow, there are 400,000 different trees in this state and each one has leaves that turn a different color. Driving home is like driving through a fireworks show every day.
October: I have hit my third deer this week. I have already filled my basement freezer with meat. Also: I apparently have a freezer in my basement. I keep meat in it.
November: Hey, where did the sun go?
December: It’s cold. I can’t believe how cold it is. We’re only in Michigan. We’re not in Canada or anything. How can it be this cold? It’s snowing and the snow isn’t melting and it’s cold. Also: how can it be cold and humid? Because it’s cold and humid.
January: I have moved back to Seattle.Report
Heh… I believe we humans come from hardier stock. I grew up in Chicago and happily lived in Minnesota for a few years. Winter offers challenges but also lots of fun. The other weird thing I don’t get is why we assume state of the art air-conditioning in impossibly inefficient glass monstrosities in Atlanta, but presume log cabins and primitive tech in cold places.
I mean, its like you’ve never heard of the Replacements.
I miss winter now that I live in Virginia.
Of course, well, millenials…Report
Hey, where did the sun go?
My friends in Portland and Seattle all talk about the “gray months” that fill up half the year. Compared to long-time Denverites, who are ready to slit their wrists after three straight days of overcast.Report
That’s one of the nice things about the front range: we can enjoy cloudy days and gloomy weather because we have so much of the good stuff.Report
Baltimore strikes me as an unlikely candidate due to the high violent crime rate, with a homicide rate of 55 per 100,000, more than ten times the national average of a bit under 5 per 100,000. Washington and Atlanta are also 4-5x the national average. Chicago too.Report
Yabbut those don’t apply to the gentrified neighborhoods where Amazon employees would be living. I expect this is true for any city.Report
Years ago I worked with a guy who had just moved to Denver from Chicago with his family. His wife was a physical therapist and the job she landed involved going to people’s homes all over the city. He told a story about his wife picking up her assignments one morning, and the office staff telling her, “Be real careful about that first one, that’s a really bad neighborhood.” When she told him about it at dinner, and he asked her how bad it was, she reportedly said, “By Chicago standards? Lower middle class.”Report
Is there no significant spillover? I’m skeptical that even the safe neighborhoods in Baltimore are as safe as the safe neigborhoods in Seattle, but I don’t have any hard data on this.Report
“safe neighborhoods” in Baltimore are looking at hiring their own security because the cops are rarely around. There’s a lot of neighborhoods that are sketchy next to ones that aren’t. Just take a look at the zillow house info and you can see one area with 600K town-homes and one block over, 40% that.Report
You can see the distribution of homicides in Baltimore here, though I suppose if you don’t know Baltimore it wouldn’t help you much. When I look through it, the gentrified hipster neighborhoods have essentially zero homicides. Of course property crimes might spill over. If you are going to break into someone’s home, it only makes sense to pick a home that likely has something worth stealing in it. FWIW, there are neighborhoods I, a large, white, obviously middle class male, would not walk through at night. There are none that I wouldn’t walk through in the daytime.Report
March,
It’s probably the best pick. For now. It’s a poor choice for five years from now.Report
The amount of confidence I am seeing from Twitter from everywhere is really quite remarkable. People in four cities, including Denver now, are saying it’s a Done Deal. (The other three are Atlanta, Chicago, and Toronto.)
I’m putting my theoretical money on the Twin Cities.Report
Hard to imagine it would be Atlanta. Toronto is interesting, but I don’t know enough about corporate accounting to know whether cross-border HQs are good or bad for taxes between those two countries (or whether it’s easy to relocate people into Canada for X years).Report
Atlanta has mass transit heavy rail, a substantial highway system, a substantial international airport, and cultural diversity.
If you believe that Amazon plays a long game (which I do) and state level cultural issues are a transient thing (which I also do), then Atlanta is a solid choice, esp if they’re still going to rely on transplants to supplement whatever local hires they might do.Report
Maybe. I suspect Amazon has a lot of employees who would see being asked to move to Atlanta for a promotion differently than being asked to move to Chicago/Denver. But maybe I’m projecting.Report
If tech corporations can do Utah, they can do Georgia.Report
I would be far happier about moving to Utah than to Georgia.Report
Seattle and Salt Lake City are very different from Baltimore, Detroit, and Atlanta in a quite visible way.Report
What are employee protections like in Canada? I can see that being a deal-breaker.Report
I hope it’s Denver.
That’ll make my house gain $20,000 in value overnight.Report
@jaybird Yeah, but we’re not planning to sell the house and the traffic on I-25 will be even more of a pain than it already is. Seattle traffic is untenable with all the Microsoft, Google, and Amazon folks commuting from their lovely houses in the suburbs to their offices in different suburbs…
Hm, maybe if we become a bedroom community for Denver for reals, I’ll finally get workable mass transit…
Hmmmmmmm.Report
As a former Seattlite and frequent visitor – you’re not wrong about the traffic. However, Seattle faces severe geographic constraints to enlarging it’s freeways, and Denver (based on my one visit) does not.Report
[Insert enviro-liberal rant about how enlarging freeways doesn’t reduce traffic and things should simply be built more densely here]Report
I don’t think you’re wrong. And the geographic constraints make the other forms of transit more difficult to implement and use, as well as making property more expensive (since there’s less of it).Report
Denver proper, and the portions of the suburbs neighboring it, are reaching the limits to practical enlargement — they’re not going to stack decks, and they’re not going to buy out large chunks of housing or businesses in order to put in more lane miles. That’s part of the reason the light rail system taxes passed.Report
There’s some basic geometry going on here. Denver can expand in all four compass directions, I think? It might have already butted up on the Rockies, so that’s only three, but they are quite a ways from downtown.
By contrast, Seattle has both Puget Sound and Lake Washington on its West and East. These are severe constraints on the number of people you can move in and out of downtown via any method whatsoever, and on how the city can grow. Cities such as Houston, which have utterly no geographical constraint on growth or transportation, tend to be much cheaper both to live in and to get around in.
You can’t build a light rail across Puget Sound to Bainbridge Island or Bremerton. You probably can’t build one across Lake Washington either, a floating bridge isn’t probably stable enough for light rail.Report
Denver and suburbs have already stretched their light rail tax source to the limit. So much so that, given intransigence on leasing right-of-way by the Burlington Northern, Boulder and Longmont are looking at 2040+ before they get rail rather than express bus. Beyond a couple of small extensions, what you see is what you get. (The Burlington Northern asked for more for the right-of-way to Boulder than the entire right-of-way budget for the rest of the metro area.)
Which in turn says that whether metro Denver can expand is sort of immaterial. If the Denver proposal is centered on light rail — which I believe it should be — then any site proposed to Amazon will be in Denver or one of the inner ring suburbs. Not only that, but in very specific parts of those cities. There are places in Denver proper that are miles from the nearest light rail station.Report
@doctor-jay the trick is that when you start in the 5000-6000 foot range, there’s a lot of waste ground because you’re already in a weird ecozone. You can’t build just anywhere, because you’re already in the foothills and any bump could take you up to 7000 without even much effort. Here’s a topo map to give you an idea:
http://en-gb.topographic-map.com/places/Denver-9209839/
So it *looks* like you have room but you really don’t.
Large parts of Colorado Springs are the same. In theory you could develop them. In practice it’s a really stupid idea. Do they do it sometimes anyway? Yes. Does it work out well? No.
That’s (one reason) why they’re so incredibly sprawly in the first place…
I mean, people can live even in Leadville, and do, but you’re never going to convince people it’s worth crowding in up there…
Additionally, I think a lot of the land in between the downtown and the nuggets (the highway corridors) has federal claims or state claims on it. Could be wrong; @michael-cain do you know? I suppose they could give those claims up, but it seems kinda unlikely. They might allow more roads on it, but if people are living just as far away it won’t help.Report
@maribou
The west side suburbs have largely already annexed up to the limits imposed by federal land, state parks, and GoCo green space (which is protected in the state constitution). More importantly, though, with the exception of the West Rail Line that makes it all the way to the Jefferson County government complex at the very south end of Golden, all of the light rail stops well short (as in several miles) of the west end of the suburbs. Anyone can do bus-based public transit. Metro Denver’s biggest advantage is to offer relatively new space with light rail service right to Amazon’s doorstep. If they don’t take advantage of that, they don’t deserve to win.
My suburb is long east-to-west, narrow north-to-south. Light rail runs (will run when they fix the crossing gate software) from the east edge west maybe half way across the city. The east half of the city is already doing infill and densifying (my zip code area is very close to meeting the household density normally used to designate “urban” rather than “suburban”). The west half is… McMansions packed check by jowl. I think in 10-15 years the people who bought those McMansions are going to be terribly disappointed by the city’s political direction.Report
@doctor-jay Mountains tend to be nearly as effective a constraint as waterways + mountains. Not quite, but getting there. Many of the existing suburbs / down the highway cities are nestled in one set of foothills or another because the plains are far less temperate. So now they’re already facing issues like “whoops, cougars in the backyard,” forest fires, massive floods, etc, because foothills go from “better than plains” to “omg we live on the side of a mountain” fairly quickly as you expand.Report
I don’t know Denver all that well, but the “foothills” type communities are pretty far away from downtown, aren’t they? That’s my recollection.
As opposed to Eliot Bay, which pretty much *is* downtown in Seattle.
The difference in distance gives you a big fanout in traffic, which helps a lot.
SF, of course, is even worse with water on three sides, not two. Of course it has transit problems, how could it not?Report
The trick with Denver is you can go east as far as Topeka at least. Consider that you could easily locate expand east of DIA. Note that about Probably locations west of Dia make a lot of sense, you have rapid transit there already. Plus for housing there is lots of empty land to the east of the airport, that would be easy to build homes on. This is also close to both I 70 as well as the east side bypass toll road.Report
@lyle You *could* but I’m not sure a bunch of Washingtonian transplants would want to (major differences in climate) . Plus I’m pretty sure a lot of that empty land, as previously mentioned, is BLM land or otherwise not easily purchasable.Report
Actually the plains don’ have much federal ownership, as folks set up cattle ranches in the past: https://www.worldofmaps.net/en/north-america/colorado-usa/map-federal-lands-and-indian-reservations.htm
note that east of Denver on the Map, has almost no federally owned land. As you approach Kansas you begin to run into wheat farms as one can see along I-70 as small towns have grain elevators. If you look at maps the site just west of DIA is close to the rail line to the airport, on the bypass loop of Denver to the East and close to I-70. I suspect that the ranchers would be glad to sell for a good price to developers now water might be a problem.Report
@lyle That’s really interesting and quite convincing on the land point. Thanks for the link!
What about the climate issues? A lot of folks I know who worked for Amazon in the early days actually *love* Seattle, chose Amazon partly to move there, and would be miserable on the eastern plains… or am I just overestimating how much people care about that? Denver obvs has a lot of other tech-job draws…Report
I think part of Amazon’s scheme is to draw more programmer types and it does take a certain kind of folks to stand Seattle Winters (rain, rain and for a change more rain). I read that most of the folks will be new hires as they increase their programming staff. And of course if your a ski type Denver is perhaps better than Seattle.Report
Lyle,
Pittsburgh winters are worse. Fewer days of sun, more snow.Report
The people who actually ship Amazon’s products have to be careful to stay below temperatures that are not survivable by humans. It’s been an issue here (since corrected). Of course Amazon fires anyone who notices that their in-house guys with temperature probes are careful to probe the coolest areas of the emergency areas for the workers.
They also fire anyone who notices that upper management will eliminate dunnage (foam peanuts, sealed air, and newspapers) to save money, thus decreasing shipping costs, while increasing returns due to damage because the dunnage was missing, because the returns don’t count against executive productivity bonuses. They will have their bonuses.
The feeling here is that if anyone in Seattle knew what it was really like to work for Amazon, most Amazon executives would be lynched for running sweat shops that don’t meet Third World standards.
Amazon is really two companies: A web company (based in Seattle) and a shipping and distribution company (run in bumfuck). It’s the same as tons of other companies that have a friendly liberal public profile and a dark underside in sweatshops in the Philippines, China,or Mexico, with the actual production run by the people who are best at maximizing profit by pushing barely paid workers to the point of death by collapse or suicide.
The reason this happens is that Amazon needs to find good shipping and distribution center managers, which is basically the same group regardless of product, and the managers with the best numbers tend to be the ones you do not want to work for. Those are the ones who taken industrial engineering and time and motion studies into places that Josef Mengele just wouldn’t go. Mine owners wouldn’t screw miners that hard because they knew their house would be routinely riddled with gunfire.
Amazon corporate may have no idea this is how things are, but then again, the Russian refrain was always “If only Stalin knew.”
The numbers look good. The bonuses reward productivity. Everything is awesome. They are constantly hiring – because human bodies give out and old workers in their late 20’s can be replaced by new workers in their early 20’s.
The future is lucrative for the elites, as it was for cotton in the early 1800’s, but is this the future we want? Sears and Walmart put in massive buys of a popular or cheap product to become almost the company’s sole customer, and then they reduce the price they’ll pay the producer until he’s facing bankruptcy, at which point they buy the producer at a discount rate because they’ve destroyed him.
There have been many highly efficient exploits in capitalism, from railroads to steel to oil. What happened made economic and business sense, but the innovators names became toxic along the way. The Amazon name may be big in Seattle, but here for many it’s synonymous with Pinkerton, Baldwin-Felts, and way below Peabody.
It’s basically on par with temporary employment agencies and check cashing services.
But I’m in Kentucky. Other regions may feel differently about it. One of the things that holds us Kentuckians back economically is our belief that some executives should be shot at a few times as a matter of honor and decency because human dignity is something worth defending.
Amazon needs to rise to meet that standard. So far, there’s little sign of it. It’s so not amazing how a huge salary makes people blind to what they do to people they regard as backwards inferiors. The wheels on the bus go round and round.Report
@george-turner
“Amazon corporate may have no idea this is how things are”
Oh, I think they know. They have their PR flacks write responses to some of the sharper news articles that have been written on the topic, so I think they know. They just don’t care. I didn’t get into this above, but part of the reason I have friends who *used* to work for Amazon and not friends who do is that the company stopped being comfortable employing people even as programmers who weren’t mindless-drone-capable, and started expecting them to be on call 24/7 so the execs could get stuff turned out according to deadline and make their bonuses, whether or not said stuff was ready for launch.
Of course that’s way way different, and less evil, than what they do to their warehouse workers, but it’s the same mindset at work – treating people like they aren’t human beings, but mere cogs in the bonus-producing machine.
They’re not the only ones either. Google treats its book scanners (for the google books project) incredibly differently from its programmers, for example.
So mark me down as 100 percent agree.
That said, please pull back a bit on the hyperbole, eh? When you compare people negatively to Mengele, it does nothing for your argument. And it’s rather vexatious. (That’s literally the only complaint I have – I’m glad you brought this topic up in detail because I was struggling with wanting to point it out myself – so please take it in context!)Report
Well, Aurora could grow in that direction. The 1974 Poundstone Amendment to the state constitution restricts cities that are a “City and County” from annexing land unless the voters in the county whose land is being annexed give their approval. The land where DIA sits was formerly in Adams County, whose voters approved the annexation to Denver (in 1988, I believe). The agreement that was voted on required that Denver not develop any of the 54 square miles except for construction of the airport and airport support services. The agreement was modified — approved by voters in both counties — in 2015 to allow 1500 acres to be developed beyond airport and airport-support functions; Denver and Adams County split any tax revenue generated as a result.
To the extent that large growth to the east occurs, the eventual outcome would be that Aurora would become the largest city in Colorado. (At ~360,000, Aurora is currently number three.)Report
@michael-cain That’s a good clarification. To be honest, I share the prejudices of many non-Denverites in thinking of all of Denver metro (Aurora, Arvada, Wheat Ridge, etc.) as “Denver” and I forget how complicated the city/county situation is up there.Report
Which is not entirely unreasonable. So far as I can tell, Denver has a better relationship with its suburbs than most places. When Hickenlooper was mayor, it was one of the things he paid attention to.
The Denver Regional Council of Governments (DRCOG, pronounced Doctor Cog) is a real thing dating back to the 50s. The Scientific and Cultural Facilities District, RTD, FasTracks, and their attendant taxes are all multi-county things and their management reflects that to a considerable degree. (In comments here at OT, I have often said things to the effect of “Based on funding, Denver’s suburbs are building a light rail system. The central hub is in Denver because that’s where it makes sense for it to be.”) Air quality is handled by a regional board. Denver Water operates independently of the rest of the city government and, IIRC, now delivers more water in the suburbs than in Denver.
As an illustration, compare the background for Coors Field versus SunTrust Park (new home of the Atlanta Braves). Denver and its suburbs got the legislature to create the Denver Metropolitan Major League Baseball Stadium District (a special district so it could have taxing authority) to build and operate the stadium. The tax to pay for the stadium had to be approved by voters across the district, with suburban voters greatly outnumbering those in Denver proper. The district chose a central site with good transportation options. Suntrust Park, OTOH, seems to be very much a story of Atlanta versus a subset of its suburbs, with Atlanta losing (and any suburbs on the opposite side of the Atlanta metro area losing even more).Report
All of that said, I’m looking forwarding to reading Denver’s proposal to see if it’s a Denver-and-suburbs story or not. And whether Aurora goes through with actually writing its own separate proposal.Report
@michael-cain all of the above is fascinating, thank you.Report
We could sell the house! Move to Montana! You could work at Missoula College (the other other U of M)! We could put up “trespassers will be shot” signs!Report
My house is within 2.5 miles of two different light rail stations. (The line’s all built, but some glitch in the gate crossing control software is keeping them from final approval.) If Amazon is serious about sites with an intent to encourage use of the light rail for commuting, I’m afraid of what my property values (and taxes) will do.Report
Mine would about double in value, if Amazon takes the brownfield down the hill. I’d probably have to move, couldn’t afford the property taxes.Report
State and local taxes as a factor have been discussed a lot — particularly the supposed advantage of states that, like Washington, have no income tax. It can be a complicated comparison. Colorado, for example, has the Gallagher Amendment which imposes limits on residential property taxes. My property taxes are not yet ridiculously low for the value of my house, but getting there. Unlike California’s setup with possibly steep increases when a house is sold, the Gallagher limits are forever.Report
The weird thing about the confidence is this is the kind of deal that Denver almost never lands. There’s a long history of HQs moving in the other direction — company starts here, grows to a certain size, is acquired, and the HQ goes to wherever the acquiring company is. The last big one they won was Vestas (wind turbines, about 3,000 jobs and another thousand in Pueblo 90 miles away) and that was simply that there was no serious competitor for skilled manufacturing work force and logistics. At that, Vestas US HQ went to Portland; it’s just the manufacturing that’s in Denver (suburbs actually, the kind of space needed for building turbine blades would be too expensive in Denver proper).Report
Michael,
I’ll write you a post on a topic of your choosing if Denver wins.Report
I’ll be as surprised as anyone if Denver wins — this is not the kind of competition that favors Denver — it’s my friend who thinks the game is rigged. Other cities/states are going to offer significantly better tax deals. Regional diversity suggests a non-American West location. If it ends up in Denver, I’d be inclined to think it’s a matter of Bezos and Co. having made up their mind to stay in the West before they started the whole process, whether that be because pot or ballot initiatives or not wanting to fly more than a couple hours between HQ1 and HQ2. In that case, Denver’s a reasonable choice.Report
Well I hope you’re right. It’d definitely be good for Minneapolis (though knowing our luck they’d choose to site in Saint Paul- Bleck!)Report
OK, I just took a swing at these numbers, and I’ve got 47 metro areas in the continental US with greater than 1 million people and an international airport. I’m going to guess that they’ve all got major highways. If any of them don’t have favorable mass transit to a possible sight, they’d put it in.Report
I could also plausibly see NC’s “research triangle” as a candidate. There’s already significant tech in the area, and good universities. The transit issue may be a deal-killer, though, I don’t know.Report
Pretty severe state-level cultural issues there.Report
Perhaps. But I think NC is poised on the brink of flipping to blue. It went for Obama both times. And a big influx of Amazon employees would probably tip the balance.Report
Maybe (and I think your presidential-voting-analysis is likely correct).
I sure remember a lot of complaints when the last big company I worked for opened a site in Lexington though. People react very negatively to places that reject their own identity, and that still describes a lot of parts of NC pretty well.Report
North Carolina went for Romney and Trump.Report
You are correct. Obama won in 2008, but lost in 2012 in NC.Report
The way they’re trying to pit cities against each other, whichever city hosts their HQ will likely have offered such a deal, the city will end up having to subsidize Amazon by raising taxes on everyone else.
Canadian cities also are apparently looking at this RFP with stars in their eyes. I hope it doesn’t end up here.Report
I’m surprised NY and NJ are in different clusters.Report
I mentioned art in addition to science? Whether NY goes into the Mid-Atlantic cluster, or the New England cluster, depends on the values of a couple of coefficients used in the “distance” calculation. Wisconsin is another sensitive state that bounces back and forth between the group to its west or to its east depending on those values.Report
The most interesting question for me is the quality of life and ability to attract top techies aspect of the request.
This is a long standing red and blue debate and one that has existed for as long as I have been politically aware if not longer. Since the mid-1990s, I have seen people complain about big businesses (especially tech companies) choosing to stay in the Silicon Valley or other expensive metros rather than moving to Nebraska or North Dakota for low taxes.
This kind of ignores the fact that wealthy blue-state metros offer much more to attract desirable employees. SF-Bay Area might be horribly expensive but it has world-class restaurants, great weather, access to nature (mountains and beach), great schools without turn-off culture war issues, etc.
Same with Seattle.
I wonder if Amazon would say something like this to Atlanta “You had a lot to offer but the quality of life stuff was not good for our employee’s and we don’t think we can attract techies in an area where a lot of people don’t want evolution taught and the politicians deny climate change.”
How would a red-state area react?Report
Atlanta. Clap emoji.
Is. Clap emoji.
Blue. Clap emoji.
https://en.m.wikipedia.org/wiki/United_States_presidential_election_in_Georgia,_2016#/media/File%3AGeorgia_Presidential_Election_Results_2016.svg
Eta
Is it because Atlanta is filled with African Americans so it doesn’t count or something?
Eta2
California passed prop 8 in *2008* not a lifetime ago.Report
Atlanta is blue but the surrounding area is very much not so.
Concern trolling is concern trolling.Report
@saul-degraw I’m gonna let everything @Kolohe said and you said slide as far as decorum issues go, purely because making this kind of claim about Atlanta is so fishing ignorant that I can’t even. (Not saying I wouldn’t let it slide anyway, but I’m not even going to get to the point where I care to address whether either of you was concern trolling because jeepers.)
Particularly when discussing a company like Amazon. Do you think Seattle metro is surrounded by people just like Seattle metro in their outlook? Protip: it’s not. Here’s an article from 2013. http://nation.time.com/2013/01/15/a-state-divided-as-washington-becomes-more-liberal-republicans-push-back/
They aren’t looking for a “blue state”, they’re looking for a blue (pro-business, pro-social-equality) metro area that has enough power to tell other interests in the state to go fish themselves on social issues. Denver and Atlanta are both equally qualified and equally Seattle-esque in that regard.
I’m not saying anything about other metro areas because I don’t know much about them and I don’t want to guess but I’m not in the mood to do research right now. I recommend you try that.Report
@saul-degraw @kolohe Actually now that my initial shock at the claim that Amazon would reject Atlanta because of its political location has cleared, I will point out that yes, you were both concern trolling with the phrases you quoted at each other, and yes, neither of you should do that.
Not to the “or else” level for either of you.
I’m sorry I lost my temper at you, @saul-degraw, but man. you broke my brain with that one. I will be more temperate in future. You didn’t deserve my pissed-offness there.Report
Maribou, you are a busybody.
I know, moderating internet forums is hard and this is new and there’s fits and starts yada yada, but no. You may have worked with other internet boards, but you’re not very good at moderating this one.
I can see why people might want to have more aggressive moderation relative to times past, but if we do you shouldn’t be the one doing it.Report
@koz I’m genuinely sorry you feel that way. I hope in time you change your mind. The way things were going before wasn’t working for anyone who was involved in moderating, and it was wearing to writers, editors, some commenters… I know different doesn’t mean better, but same wasn’t working, so we’re trying different. Of the people available, I was the best willing choice.Report
@maribou I for one appreciate your moderation efforts. The constatnt bickering, disputes between commentators that hate each other and will argue minutia just because of who posted was getting very tiresome. Not to mention some of the disturbing defenses and arguments being made. (I come here to hear differing points of view and intelligent discussion there of. Not for diatribes and high school in fighting.)Report
@anne That’s good to know. (I’ve missed you around here!) I hope if I ever do moderate things in a direction that you find worrisome, you say something then as well. I definitely have made a mistake or two already (and will no doubt continue to do so), so I don’t want anyone to feel like they shouldn’t give me pushback. Still I appreciate the support.Report
@maribou I’m always here lurking daily 🙂 don’t comment as much as I should. Promise to let you know if I think you ever are pushing something I consider unfair. Again thanks for stepping up to keep this site going I love it and the people here.Report
I’m sorry too.
It’s definitely possible that I could feel different at some point in the future. Most likely that would be because you’re doing things differently. If you’re doing the same things I’m probably going to feel the same.
As far as the rest of it, it seems this way is wearing on everybody.
For some of the slow periods, it seems like you are an overactive TV analyst for a slow baseball game, where yours are like one third of the comments. Two people are posting back and forth, and you are putting in distracting parenthetical judgments.Report
@maribou
Is this part of the concern trolling? I honestly don’t see it. But maybe that’s because when I think about Atlanta, I see it as “Black Mecca” more than I see it as “Red State.” It’s impossible not to see Saul’s comments in the context of Atlanta being, not only a majority black city, but maybe THE majority black city right now.Report
@j-r I think jumping to the “are you dismissing black people?” question is … well, maybe not concern trolling, but definitely not speaking from the assumption that Saul is speaking in good faith. Which we try not to do around here.
Given the other things Saul has said, I think ignorance about the south and a generalized prejudice against it (which showed here in *his* concern trolling) is a much more likely explanation than assuming he doesn’t think black people count. (Implicit bias that they don’t? Yeah, I’d believe that, but that’s not what Kolohe said.)
That said, this one was so stunningly ignorant that I lost my own temper, and went to much the same place Kolohe and you did, so I really don’t blame Kolohe for going there. At all. It’s possible I was being too generous to Saul because I felt bad for snapping at him. I don’t think so but I can see why someone might.
And I appreciate you speaking up as you just did, and emphasizing the specific, most central reason why that’s an ignorant assumption to make. Because it does matter, regardless of what I might think about Kolohe’s phrasing.Report
@maribou
First, thing let me just acknowledge the moderating work that you’re doing. Thank you! I’ve seen you getting pushback and I want to assure you that this is not one of those cases. From my perspective, you guys who do the work on the site have earned the right to call things as you see them.
On the substance of the matter, I’m not sure I agree how much supposed good faith or intentions matter. There is a certain element of partisan politics/culture war that involves a certain type of coastal progressive signalling their progressive beliefs not just as an affirmation of a political perspective, but as a way to signal that they’re the right type of white person. And this has the effect of turning everyone else into supporter characters in a white people’s morality play.
When the wrong type of white person does the same thing, that is, signals their conservative/libertarian bona fides in a way that completely erases people of color from the picture (e.g. Steve King’s musings about how white people built civilization or the attempt to paint immigrants as barbarians at the gate), almost no one here has a problem calling that out for what it is. I don’t take any of this personally and I don’t even have any strong desire to call out individuals on this type of behavior, but let’s keep the same energy across the board.Report
@j-r Yeah, you know, I think you’re right. Thanks for going into more details. I’ll try to be more aware of that problem going forward.Report
Any comment about “blue” or “red” states isn’t worth reading, because it reflects thinking that was misleading at best 17 years ago. In this case, it’s worse than that, because it’s assuming not only that each city is a perfect reflection of its state’s politics, but that a company like Amazon couldn’t function within a city whose culture doesn’t mirror Seattle.Report
Houston is blue. Every single Harris countywide position went (D) in the 2016 elections.
The only thing Houston doesn’t meet is mass transitReport
You could have fooled me with all those cartoons people were drawing of fat ignorant rednecks being saved from floodwaters by the federal government. Hillary told me to place my trust in the media.Report
Was there more than one of those cartoons?Report
There was!Report
Really….oh well.
I used to be so plugged in to the modern world…..now……sigh. Now it’s almost Soylent Green time i guess.Report
This just changed in the last 10 years before that Harris County (the county houston is in) was Red Interestingly Fort Bend County (just Sw) of Houston went blue in the presidential election also (just barely)Report
But the Texas state legislature (and governor) may make it difficult for minorities to vote, outlaw affirmative action, ban abortion, and allow discrimination on the basis of sexual orientation. Depending on what the SCOTUS allows a couple of years down the road. Nasty if the state overrules Houston or Harris County and says enforcing your company value statement is illegal.
No guarantees that they will, but there are states where such actions are more likely.Report
This is the point. It’s not about whether a specific city has nice people (“red” cities are often full of nice people).
A company like Amazon is just very unlikely to set up shop in a state that has statewide political processes that restrict access to things that prominent members of the company would consider basic rights (e.g. Kentucky).Report
Really? You mean the Right-to-Work state where they expanded their investment just this year?
I guess there’s solidarity, and then there’s solidarity.Report
Yes, really. A headquarters is different from a warehouse/distribution facility.Report
Yep, you pretty much have to build warehouses and distribution facilities around the country (I mean, under Amazon’s delivery model). You don’t get to be choosy, you’re looking for nationwide coverage under specific constraints.
HQs, though — that’s different.Report
morat20,
pshaw. they’re looking at nationwide coverage… for some things. Sameday delivery is gonna be NYC, SanFran, and other dense metros.Report
Nobody serious suggests relocation to Nebraska or North Dakota. They do suggest relocation to other, less expensive and less taxed cities. Companies haven’t relocated, but they have put substantial offices in these places.
Which is precisely the sort of location that Amazon is doing right here. My money is on Minnesota, so I’m not betting on Team Red here, but the notion red states wouldn’t be on the table is unfounded.
It’s also worth pointing out that Amazon probably won’t care about overall tax rates because they’re already demanding huge tax breaks. So we can’t quite say that don’t mind the taxes.Report
Yeah, *I’m* the one that’s fishin concern trolling.Report
Denver is well on its way to becoming unaffordable, even without Amazon’s help. Denver is all over the internet as the #1 choice for HQ2. Denver home prices are up 10% yoy, avg homes around 400K right now. If you throw an Amazon on that Denver fire you looking at 20-30% housing price inflation even before ground is broken.
Denver would turn into a Seattle in 24 months.
The Denver home speculators are probably already salivating with anticipation of this “done-deal”.
Toronto ($700k), Boston, NYC, DC, all of California in the unaffordable category.Report
Would… would there be an increase in the quality of family-owned and operated restaurants?Report
Mingo County West Virginia is affordable. Trulia’s map says the median listing price for a home there is $30,000. The Tug Fork could provide cooling for massive server farms, and local logging could provide green energy, with coal as backup. It also has Hatfields and McCoys and the site of the Matewan battle between the union and the Baldwin-Felts guys.
It would be smart to buy in now, before Amazon gets the home prices all jacked up.Report
I was real-estate-porning a while back and looked at a small town in West Virginia, at the newly renovated house that clearly was a local rich guy’s mansion, back in the day. It was gorgeous. The asking price was only modestly higher than what I paid for a three bedroom townhouse.Report
This does strike me as the primary liability of Denver. Though I’m not familiar enough with the terrain to know if you can do a lot of buiilding to the east.
Inland California isn’t too bad, in terms of being expensive. I think they lose out on other criteria, though.Report
Though I’m not familiar enough with the terrain to know if you can do a lot of buiilding to the east.
You can build east all the way to the Kansas border and beyond. But as you move away from the mountains, the weather gets significantly worse: hotter in the summer, colder in the winter, more severe blizzards, big thunderstorms more often. Denver will set a variety of temperature extreme records in coming years simply because the official readings are now taken at DIA, and are more extreme than the readings done at the former Stapleton site, which was quite a few miles closer to the mountains. The east side is mostly Aurora, where median price per square foot for housing is about 20% lower than the metro area as a whole. Aurora has indicated that they will probably make their own proposal to Amazon. I think it’s a pretty safe bet that they’ll offer something along the light rail line (west-center part of town) if they can find it, rather than out on the east edge.Report
I was flying Minneapolis to Houston this past May. Changed planes in DIA
It was sunny and beautiful in Minneapolis. Great jogging weather. It was pleasant enough in Houston
It was snowing in DIA. It snows in May in DIA!!!Report
I was on a retreat in the [near and low] mountains about an hour and a half from Denver. In June. It snowed. QED.Report
IIRC, the high temperature for that week was in the 80s. There are four seasons in Denver. We’re not afraid to use all of them in any given week.Report
Yuuup. When we do get the snow in May, things are usually back to normal the next day.Report
@j_a
I intended to add that I greatly admire the chutzpah of someone who can complain about a bit of May snow somewhere else so soon after they got 55 inches of rain in five days :^)Report
Colorado Geography has a region called the Colorado Pediment that extends from Denver North and East. (about 50 miles east and roughly 30 mi east of DIA which is on the east side of town) then you go up a hill and you are on the High plains (if driving W on I -70 the edge of the pediment is where you first see the mountains) The pediment is essentially the South Platte River Valley.Report
And then there is my neck of the woods: https://www.cnbc.com/amp/2017/09/12/amazon-execs-want-second-hq-in-boston-says-report.html
I’m not sure what to think. I already get a lot of attention from Amazon recruiters, so that would no doubt increase. I suppose a big HQ would prove annoying. I can’t imagine our transit system would survive. Plus we already have too damn many nerds.Report
Can you ever really have too many damn nerds? I am skeptical.Report
@north — Young male tech nerds create a very unpleasant and dysfunctional monoculture. In fact, one of the things I like about Boston is that we are not like silicon valley.Report
So then the solution is… more nerds! At least more non-male and/or non-young ones!Report
Also, other sorts of nerds. Tech nerds are a subset of nerddom.Report
Agreed!Report
Well yeah. I don’t want to end up in a culture space where most women at some event are models who are paid to attend — not that l mind the models. They’re lovely and cool. It’s the men who hired them.Report
Hey, if you are ever out here, I’d love to drag you to a gaming party of old tech nerds, not all of whom are male, hetero, or cisgendered.
Which is to say, I know companies out here that are pretty much exactly what you describe, and companies that are quite different than that.
I’m just very tired of the “Silicon Valley is X” formula, which is often bandied about by people who know less about it than you, and I want to represent.Report
@doctor-jay — Oh hell yeah. Sadly, the Flights team is kinda split between Boston and (of all places) Zurich, so I almost never have any reason to make it out to the Mountain View office. But still, if I’m ever out there again, I’d love to hang out with you.
If you ever find yourself in Boston, don’t be a stranger.Report
My company watches Amazon very closely (it comes up in work diacussions at least 1.5 times per week). Not that we have any special knowledge but out read is that the HQ will be somewhere in the east. Geographically, Louisville or Cinicinnati would be an awesome choice for their central locations, but we can’t supply that many workers.
My vote would be Atlanta. I go down therw for work pretty regularly and they have a very diverse and well-educated workforce.
Beyond Atlanta, anywhere in the East Coast metroplex seems like a good choice, while being mindful of the cost of living, etc.
I also like suggestions of the Carolinas, though I’m not sure the workforce is ready and has the required skillset…yet.Report
NC is a tech powerhouse in both Raleigh and Charlotte. In fact, in some ways the way they wrote their RFP (esp. around the silly specific city specs) seems designed to prevent NC out of fear that NC is probably the best fit.
SC, I don’t know anything… never worked on clients there… but NC is very strong from a Tech perspective.Report
Actually IBM had a large presence in RTP in the Raleigh area. (It may be smaller now but). Plus you have a number of universities in the area UNC and Duke being the leading onesReport
So maybe NC could be a contender, but the mass-transit thing might hurt them.Report
Mike,
Amazon’s a competitor for you, isn’t it?Report
A question which has occurred to me is that Amazon’s HQ1 is in a state where calling your spouse and saying, “Honey, stop at the shop on the way home and pick up an eighth of Heavy Duty Fruity for the weekend” is legal. Will it make any difference?Report
Oooh! Oooh! I know a state that would work!Report
I was literally scrolling through the comment threads to see if anyone else had made this point yet. As a Seattleite I’m friends with a fair few current and former Amazon employees at various levels of the organization, and years back I even worked as a contractor for them for a time, and as soon I saw the announcement I assumed it’d be Denver for this reason alone. This is 100% anecdotal, of course, but from what I’ve seen Amazon has always had a large contingent of the marijuanically-inclined in its workforce. Hell, at one point there was a rumor going around that they were going to piss-test the employees at the office I worked out of, and our HR rep told us, “They’ll never do that, they’d have to fire 80% of their employees and 90% of their management.”Report
If that’s really the case, then it would seem to cut the “usual suspects” lists kicking around the internet down to Denver and Boston.Report
I doubt it. Executives rarely have trouble obtaining whatever it is they want, and I suspect many of them in Seattle currently want other products that are less legal.Report
Ottawa is putting together a bid and they manage to tick off the all the boxes including the strong left lean.Report
Honest question — how hard is it currently to move white-collar workers back and forth across the US/Canada border? In the sense of Jane Smith in Seattle taking a promotion to a different department that happens to be in Ottawa, or in the other direction?Report
To be honest, I’m not sure (government peon so this doesn’t come up for me). I suspect that, given the number of businesses that operate HQs in both countries, this is a common enough thing that the process is pretty well worn but I’m just guessing.Report
I can’t give numbers, but I work with a lot of Canadians, and it seems pretty easy to move to Canada if you speak English and have a high salary job lined up. It’s certainly workable.Report
See you you score on the Comprehensive Ranking System quiz!
Report
It seems the discussion has neglected to mention one of the most compelling options for the new HQ.Report
I will officially laugh my ass off if Amazon moves to Pittsburgh.
No, seriously… I’m actually surprised that nobody’s even mentioned Pittsburgh in over 100 posts.
My friend who works for Amazon, in his capacity as “prankster” doesn’t want them to come here (as his 4 hour pranks would then need to be limited to, oh, 20 minutes, or roughly the time until they could drive over and demand to know what the fuck he was thinking…).
Of course, he also works tourism/PR for Pittsburgh (called enlightened self-interest, at least when Saul’s not reading his work), so he can’t actively militate against Pittsburgh.
We’ll all know in November.
As for why Pittsburgh? There’s a reason our mayor’s been calling us Roboburgh for a while now (even got Obama to say it). Amazon wants out of the “selling things” business, and to get more heavily into the “distribution” side of things.Report