Citing opposition from “a number of state and local politicians” as an overwhelming force that ultimately led to the decision to drop Long Island City from its “co-HQ2” status, Amazon announced today it will not build a New York City headquarters after all. The online retail behemoth blamed politicians for its decision to opt against building the co-HQ2 in the New York area despite, the company claimed in a statement posted on its website, “70 percent of New Yorkers support[ing] our plans and investment.”
On the official Amazon blog, DayOne, Amazon indicated that although the company “loves New York, its incomparable dynamism, people, and culture – and particularly the community of Long Island City,” it will not move forward with the headquarters due to “clear opposition to our presence” with the development. However, the post also indicated that the 5,000 Amazon employees currently located in Brooklyn, Manhattan, and Staten Island will remain “and we plan to continue growing these teams.”
The announcement concluded with an expression of gratitude to New York governor Andrew Cuomo, New York City mayor Bill de Blasio, and their staffs. Amazon will not reopen the HQ2 search at this time, but “proceed as planned in Northern Virginia and Nashville.”
Updated: 2.14.2019: 2:04pm EST
“[When] Bezos pulled out [of Long Island City], THE world’s richest company controlled by the world’s richest man just told New York: ‘Go to Hell,'” observed Salvatore Buscemi, managing director of Dandrew Capital Partners LLC. “The real issue is that in the current aggressive political climate, New York is now considered radioactive as nobody is going to move their business to NY after this,” he added.
“As far as real estate goes, the real winners were those who took this as a brief opportunity to sell their home at a premium (so they could move to Florida where the taxes are lower). Those who bought on pure speculation will be in a world of pain. Announcements are just that, announcements. Until it’s inked, don’t trust the narrative. It also doesn’t help that New York State Governor Andrew Cuomo as of yesterday was begging Trump for $2.5 billion as he has New York State going broke now with the SALT taxes that are suffocating home and condo sales – at the higher price levels,” Buscemi continued, concluding, “The dam has just collapsed.”
Updated: 2.14.2019: 5:22pm EST
“I think it's a bad sign for future New York and, ultimately, the closed process in choosing New York City [to host the co-HQ2] is to blame,” added Jeremy Brutus, co-founder of luxury amenity management and consulting firm URBN Playground. He added, “The lack of awareness from the governor, who does not live in New York City, is kind of astonishing. I do fault the governor partially and, also, the benefits were never really understood by city dwellers.”
Certainly not all local politicians could clearly see how hosting HQ2 would help Long Island City, and some of the most vocal were adamantly against Amazon. Controversial and highly vocal democrat representative Alexandria Ocasio-Cortez, known for both her multimillion-member Twitter following and recently, the highly disturbing “Green New Deal,” triumphantly gloated in response to Amazon's announcement: “The decision shows everyday Americans still have the power to organize and fight for their communities, and they can have more say in this country than the richest man in the world.”
Interestingly, Ocasio-Cortez is just about the only party blaming the local population for Amazon's exit; everyone else on all sides of the equation appears to be blaming local politicians like her. Cuomo, for example, commented this afternoon, “A small group of politicians put their own narrow political interests above their community…the state's economic future, and the best interests of the people of this state.”
Long Island City was announced as one of two co-sites for Amazon’s much-sought second headquarters, referred to as HQ2, just three months ago. However, when Amazon announced it would split the headquarters and, along with that split, the number of jobs coming into the area and, in theory, the potential economic stimulus, many critics of the company and the massive tax incentive programs New York City offered Amazon in order to secure the co-HQ2 award were incensed. Some economists estimated the “win” would actually cost New York City about $3 billion, creating, at best, a “break-even” scenario based on Amazon’s estimates for what the split decision, which included a 5,000-job “Amazon Operations Center of Excellence” for Nashville, Tennessee.
New York City Council speaker Corey Johnson, who has spoken out against many of the tax incentives, said in response to the announcement that he “looks forward to working with companies that understand if you’re willing to engage with New Yorkers and work through challenging issues, New York City is the world’s best place to do business.” He added in an interview with Channel 4 New York, “I hope this is the start of a conversation about vulture capitalism.”
Multiple union representatives also have spoken out, praising Amazon’s decision to back out if it would not “address the legitimate concerns” associated with HQ2. Many locals also bemoaned the decision, however, expressing concern for the loss of the incoming “flood of new high-wage jobs, business development, and much-needed tax revenue to the entire region,” as Nassau County executive Laura Curran put it in her plea that Amazon “please reconsider their decision.”
Make your voice heard:
- Are you surprised by this?
- Is it a loss or a narrow escape for Long Island City?
- Did you invest in any HQ2-related investments?