Amazon's HQ2–Is the Choice Already Made? Here Are Some Clues

Amazon’s year-long saga of choosing its second headquarters city–“HQ2“–should coming to an end soon. The company has promised it will make an announcement by the end of 2018, which means it has just over two months left. 

Today, The Wall Street Journal reported that Amazon officials paid return visits to several of the 20 finalists, including New York City, Chicago, and Newark, New Jersey. In New York City, the site under consideration appears to be in the up-and-coming area of Long Island City, in Queens. 

Of course, the inside sources who shared this information with the Journal emphasized that the choice has not been narrowed to these three locations and that Amazon will likely check in with some of the other contenders as well. The inside sources even noted that Amazon might (somewhat sadistically) carry out negotiations with several different cities until a deal is all but complete, letting them think they’re still in the running just to avoid tipping its hand too soon.

But many expert observers are predicting a different choice, and they have logic on their side. They also have the bookmakers on their side. As The New York Times observed this week, Northern Virginia seems to be the likeliest option. For one thing, Northern Virginia already hosts the largest and fastest-growing offices outside of Seattle for Amazon Web Services (AWS), the company’s highly successful cloud-hosting division. Then there’s the fact that Jeff Bezos has been talking with with local developer JBG Smith which owns large portions of a neighborhood called Crystal City, which just happens to be right across the Potomac from Washington, D.C., where Jeff Bezos just happens to be spending $12 million to renovate the $23 million mansion he bought two years ago. He also owns The Washington Post. Of course, D.C. itself is one of the 20 finalists as well, but given the congested traffic in the city already and the fact that it can only provide the space Amazon wants across multiple locations, most don’t see it as a truly serious contender.

The Seattle-based tech site GeekWire just provided another big clue to where HQ2 may wind up. Consider that Amazon has said it will open the first phase of HQ2–at about half a million square feet–sometime in 2019. That’s a lot of office space, which suggests Amazon will need people to occupy those offices. A lot of those people will be software engineers, and software engineers are notoriously in high demand and difficult to hire. A smart company, good at looking ahead–which Amazon unquestionably is–might be working on hiring those engineers right now. So GeekWire did something brilliantly simple: It looked at how many engineers Amazon appeared to be hiring in all 20 of the finalist locations (they all have some Amazon presence already). Northern Virginia had the most jobs to fill by a wide margin.

With that in mind, consider something very interesting about Amazon’s list of 20 finalists. Nineteen of them are either a specific city or (in the case of Montgomery County, Maryland) a specific county. Only in Northern Virginia’s case is a finalist identified as an entire portion of a state. As it turns out, among the 238 proposals the company received, at least two separate pitches came from Northern Virginia–a joint proposal by Fairfax and Loudoun Counties, and another joint proposal by Arlington and Alexandria Counties. If Amazon had treated those the same way it did all other proposals, it would have identified one pair of counties or the other as a finalist, or perhaps both pairs as two finalists. Does listing Northern Virginia in general as a finalist mean it’s considering even more proposals from other counties or towns? Or was it that Amazon didn’t want to zero in too quickly on the geography it already favored for HQ2?

There could be a simple explanation for Amazon’s Northern Virginia hiring spree. Back in 2017, the company announced it would build a new AWS campus in Northern Virginia, although it offered very few specifics beyond saying that new campus would add 1,500 jobs to the 7,000 already there. So maybe Amazon is building its big new offices in Northern Virginia at the same time as it is also building a much larger HQ2 in some completely different location. Or it could be that HQ2 is in Northern Virginia. And that it’s been hiding in plain sight for more than a year.

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