REMARKABLE! TORONTO MAKES THE SHORT LIST FOR AMAZON’S HQ2
Toronto. Los Angeles. New York. Atlanta. Denver.
What do these cities have in common? They are among a distinguished group representing the short list for Amazon’s next headquarters. Announced last month, the list of 20 cities includes a single Canadian entry (beating out 11 other bids north of the border, including Vancouver, Calgary, Winnipeg, Halifax, and Montreal, and selected from 238 submissions in total) – kudos to the 6ix!
Earlier this month, Prime Minister Justin Trudeau met with Amazon CEO Jeff Bezos, giving credence to the rumours that Canada’s business capital is a serious contender for HQ2. But how did we make the list and what would an Amazon headquarters mean for the city? Here’s everything you need to know.
Seeking: A Large, Business-friendly Metropolis
So what were Amazon’s criteria for HQ2? The retail giant’s wish list included proximity to a metropolitan area with a million+ people, a location within 45 minutes of an international airport, direct access to mass transit, and the capacity to expand the headquarters to almost a quarter of a million square metres over the next ten years.
The RFP also outlined the ability to attract top tech talent, an area where Toronto (benefiting from “the more relaxed immigration policy in Canada,” as one senior analyst with Edward Jones aptly described it) comes out ahead. “We build doors, not walls,” read the cover letter from Toronto Global, the group co-ordinating the city’s bid. “Those doors open to highly skilled economic immigrants and international students who can easily become permanent residents and citizens.”
$5 Billion Buys a Lot of Timbits
What would an Amazon headquarters mean for T.O.? For starters, the winning city is expected to gain 50,000 new technology jobs and direct investment of more than $5-billion (U.S.). In addition, construction and ongoing operations is expected to create tens of thousands of additional jobs and tens of billions of dollars in additional investment in the surrounding community. In Seattle (home to Amazon original HQ), the company estimates that, from 2010 to 2016, it has contributed an additional $38 billion to the city’s economy; every dollar invested by Amazon in Seattle generated $1.40 for the city’s economy overall.
Let’s Not Count Our Chickens Just Yet
While making the cut is certainly reason to celebrate, we may not want to pop the champagne just yet. Competition for the prize is understandably fierce, and in an era when protectionism is ripe in the United States, it may be tough to woo business north of the border. Not only that, but Toronto opted not to offer tax breaks (many other contenders used financial incentives as a bargaining chip – New Jersey offered $7-billion in tax incentives), some of our proposed sites require significant services and infrastructure (Amazon has said it will favour locations that have existing infrastructure in place), and Toronto has some of the most costly housing and lowest rental vacancy rates in North America (making it difficult for new residents to find a place to call home).
But losing the bid might be a blessing in disguise. Critics warn that winning the top spot might not be as exciting as it sounds. “Winning the prize risks making unaffordable housing, gridlock and brain drain even worse,” reads a headline from the Financial Post. A Seattle journalist confirms, “When so many highly paid jobs come all at once, it can be a boost for the economy and tax bases in these cities, but it can also bring a lot of challenges and overwhelm infrastructure if transportation and affordable housing are not already in place, as well as, most damning here [in Seattle] I think, increase house prices and rents to unaffordable levels for people not making those tech salaries.”