How Northern Virginia locked down Amazon HQ2

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Moderator Bill Collins (right) interviews Matt Kelly, CEO of JBG Smith, (left) and Holly Sullivan, head of worldwide economic development for Amazon (center), as the keynote panel for the “Amazon HQ2-Apalooza” in Crystal City last week. (Photo Credit: Alfredo Flores)
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By Missy Schrott | [email protected]

More than 1,000 community members and stakeholders gathered Feb. 28 for an “Amazon HQ2-Apalooza” to learn about the tech giant’s impending presence in Northern Virginia.

While Arlington County hosted the event, representatives from throughout the region attended both as audience members and panelists, including Stephanie Landrum, president and chief operating officer of the Alexandria Economic Development Partnership. Other panel speakers included representatives from Amazon, Virginia Tech, JBG Smith and Arlington Economic Development.

Several of the panelists focused on the story of what made Northern Virginia stand apart from Amazon’s 237 other location proposals.

Holly Sullivan, Amazon’s head of worldwide economic development, said when Amazon sent out its request for proposal for a second headquarters, leadership didn’t have a specific location or environment in mind.

“We absolutely did not know where we were going. I can fully attest to that,” Sullivan said. “We had 238 communities sitting in on this project, and as we started looking at the data and kind of cooling that down, we did learn about ourselves … that we prefer an urban campus.”

The urban campus presented in the Northern Virginia proposal is a 150-acre site composed of a combination of existing JBG-owned buildings and developable land. Sullivan said Amazon and its employees were more interested in being based in an accessible neighborhood community than an isolated suburban campus.

Victor Hoskins, director of Arlington Economic Development, said collaboration among the different jurisdictions had been Northern Virginia’s key to drawing in Amazon.

“This region wins because it’s united. We won this because we approached it in a collaborative way,” Hoskins said. “We were really trusting each other. I think that’s what we did – we built a level of trust that frankly I don’t know if it can ever be imitated. I feel sorry for any region that has to compete with us in the future. It’s going to be hard.”

The incentive packages from Alexandria, Arlington and the Commonwealth of Virginia were major components in the Northern Virginia proposal, according to Landrum. Gov. Ralph Northam signed off on state incentives of up to $750 million in February.

“We sat at a table very early on with the state and said, ‘We want to win Amazon, [but] we don’t need to win Amazon,’” Landrum said, “so we cannot be seen as putting something forward, a package that would not fly in our community, a package that is seen as a giveaway, that does not bring solutions to the issues that we have in our communities.”

Landrum said state leadership supported community-driven incentives.

“We talked about what a successful package would look like to Amazon, but also to our communities,” Landrum said. “One of the things I think all of us are proud of is that the investment package for Amazon, a third of it goes to the company but two thirds of it is an investment in our communities.”

Community investments include funding for education, affordable housing and transportation. A major win for Alexandria is funding to add back a southern entrance to the Potomac Yard Metro Station.

Matt Kelly, CEO of JBG Smith, agreed that projects that have been years in the works would now be possible because of Amazon.

“I do believe it was always very sincere and authentic that they really wanted to be in a place where they would be welcome and a thriving and constructive neighbor in the community,” Kelly said, “and to me that … says a lot about the future in terms of what we can expect and what we’re going to get out of this as a region, which I think is incredibly positive. And I think it really enables us to turbocharge what is a long, long wish list of things that are long overdue.”

Sullivan said Northern Virginia’s incentives had been an important factor in Amazon’s decision, but not the only consideration.

“Incentives are important,” Sullivan said. “They are a tool in the tool box, but more importantly – we said this publicly, I’ve said this publicly, we said in the RFPs – we wanted to locate in a community that also supports us. … We’re saying we’re going to create at least 25,000 jobs in Virginia, so we’re putting our skin in the game, so for the state and county to also support us is really an important part.”

In response to questions about Amazon pulling out of its New York headquarters, several panelists reiterated that the Northern Virginia headquarters will continue as planned. Some also discussed why Virginia had succeeded where New York failed.

“We want to really locate where not only our company, but our employees, are welcome,” Sullivan said. “And we feel that in Arlington, and we think that’s the core part. We think we could’ve gotten New York done, but you have to always say, at what cost? So I think we made a very prudent decision that gives us an opportunity to really hyper-focus on Virginia.”

Not everyone in the region is happy about Amazon’s imminent arrival – three protestors made an appearance at the event to demand a public hearing – but Sullivan said the response in Northern Virginia has been largely positive and welcoming.

Landrum said the positive regional reception stemmed from making sure the deal worked at all levels, from local to state.

“There is so much room and additional density available for development that our communities expect and want,” Landrum said. “These plans are visions that our communities put in place, in some cases, a decade ago, and we need [Amazon] to support the new Metro station at Potomac Yard, to pay taxes in our communities and to build the 24/7 mixed-use communities that we expect in both of these jurisdictions, and so I’m really excited about the impact.”

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1 COMMENT

  1. Basically, you give the company every benefit and loop possible, at the taxpayers expense, and say screw the citizens. Isn’t this the same company that “paid $0 in U.S. federal income tax on more than $11 billion in profits before taxes. It also received a $129 million tax rebate from the federal government” last year?
    Should taxpayers be the beneficiary of these lucrative tax rebates? Whatever money Amazon won’t be paying will definitely be made up in higher taxes, cost of living expenses, rents and merchandise costs.

    (https://www.cnbc.com/2019/04/03/why-amazon-paid-no-federal-income-tax.html)