Amazon’s Long Island City campus was dead on arrival, after the company negotiated with New York officials for more than a year in secrecy.
It took Amazon more than a year of behind-the-scenes negotiating to announced that it would be building a big office in New York City. Then, it took the ecommerce giant just three months to say “actually, never mind.”
In case you missed it: this morning, Amazon announced that it would no longer be building an office in the Long Island City neighborhood of Queens, New York. The office was announced at the tail-end of Amazon’s much-publicized search for a second headquarters, dubbed HQ2. Amazon first announced in September 2017 that it intended to open an HQ2 for 50,000 employees somewhere in North America, and it was soliciting bids from cities to figure out where to put the office. Some 238 cities put their hat into the ring, but after a year of searching, Amazon announced in November that actually, it was instead going to open two offices: one in Long Island City, and one in Crystal City, Virginia, both of which would eventually house 25,000 workers.
Amazon said today that it was abandoning those plans for the Long Island City campus due to opposition from state and local politicians. In recent weeks, state lawmakers appointed a senator to a board that had the authority to cancel the nearly $3 billion incentive package Amazon received to open the office. However, Amazon said that it continues to expand teams in Brooklyn, Manhattan, and Staten Island, which altogether consist of over 5,000 Amazon employees.
It’s unclear yet whether Amazon’s decision to pull out of New York will cause other cities to reconsider offering tech companies large incentive package. Both of the subsidy packages offered to Amazon by New York and Virginia have received criticism, as well as a nearly $4 billion subsidy package offered by the state of Wisconsin to Foxconn in 2017. However, a recent survey of U. S. mayors found that the majority of them still think that tax incentives are a good way to lure businesses, indicating that incentive packages are here to stay in the short term.
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