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Late this morning, Amazon announced that due to local opposition, it is canceling its plans to build a headquarters campus in New York City, a move that would have created an estimated 25,000 jobs and brought a minimum investment in the city of $2 billion, in exchange from close to $3 billion city and state incentives.

Amazon’s commitment, the company said in a statement, “requires positive, collaborative relationships with state and local elected officials who will be supportive over the long-term. While polls show that 70% of New Yorkers support our plans and investment, a number of state and local politicians have made it clear that they oppose our presence and will not work with us to build the type of relationships that are required to go forward with the project we and many others envisioned in Long Island City.”

Amazon announced late last year that after months of public consideration and speculation about where it would put a second North American headquarters (HQ2), it would be split the expansion between two of the finalists - New York’s Long Island City, just across the East River from Manhattan in the borough of Queens, and Arlington, Virginia, in the Crystal City neighborhood, adjacent to National Airport and just across the Potomac River from Washington, DC.

Virginia, from all reports, has been easy to work with. New York City, not so much.

The backlash came from a number of quarters, with people questioning things like the size of the incentives, the impact on local neighborhoods and housing costs, the expected stresses on the city’s infrastructure, and the company’s long-held resistance to unionization, which is not the most welcomed attitude in a highly unionized city.

The Amazon statement continued:

“We are disappointed to have reached this conclusion - we love New York, its incomparable dynamism, people, and culture - and particularly the community of Long Island City, where we have gotten to know so many optimistic, forward-leaning community leaders, small business owners, and residents. There are currently over 5,000 Amazon employees in Brooklyn, Manhattan, and Staten Island, and we plan to continue growing these teams.

“We are deeply grateful to Governor Cuomo, Mayor de Blasio, and their staffs, who so enthusiastically and graciously invited us to build in New York City and supported us during the process. Governor Cuomo and Mayor de Blasio have worked tirelessly on behalf of New Yorkers to encourage local investment and job creation, and we can’t speak positively enough about all their efforts. The steadfast commitment and dedication that these leaders have demonstrated to the communities they represent inspired us from the very beginning and is one of the big reasons our decision was so difficult.

“We do not intend to re-open the HQ2 search at this time. We will proceed as planned in Northern Virginia and Nashville, and we will continue to hire and grow across our 17 corporate offices and tech hubs in the U.S. and Canada.

“Thank you again to Governor Cuomo, Mayor de Blasio, and the many other community leaders and residents who welcomed our plans and supported us along the way. We hope to have future chances to collaborate as we continue to build our presence in New York over time.”

MNB earlier today took note of a Reuters report on how cities that were runners-up in the Amazon HQ2 sweepstakes see a glimmer of hope in the fact that some New York City politicians are objecting to the financial incentives offered in order to land the deal. Cities that did not get the HQ2 nod - such as Chicago, Miami and Newark - are “revisiting their bids,” the story said. Even Connecticut, just an hour away from the Long Island City site, was planning to make a play if Amazon pulled out of its original plans, even though it didn’t even make the list of 20 finalists.
KC's View:
So Amazon decided that it didn’t need a New York headquarters campus to prove that it had made it, and that it could make it anywhere.

In the end, Amazon really got most of what it wanted, and it still has an enormous amount of information about hundreds of places were, to varying degrees, willing to move heaven and earth to get the HQ2 project. And, let’s be clear … those communities also know what it will take to land a 21st century company such as Amazon, and if I were them, I’d be making a lot of infrastructure decisions based on that information. It doesn’t make sense, after all, to be trying to attract 20th century companies with 20th century infrastructure. (In fact, I’d be thinking right now about 2050 and beyond, and creating community cultures that are designed to meet projected future needs.

Amazon does say it won’t “re-open the HQ2 search at this time,” and I think that’s the truth - it doesn’t have to. It can make considered and informed and disruptive decisions anytime.

As for New York City … well, it still is the greatest city in the world. Nothing has changed that. I just worry that an inability to embrace Amazon and build a 21st century infrastructure that could serve the company’s needs - while still being sensitive to local community concerns and desires - doesn’t speak well for it.

Ironically, the New York Times had a piece the other day about nine mass transit systems outside the US that could fairly be described as superior - often vastly superior - to the New York City subway system (which isn’t setting too high a bar, let me tell you). If the city wants to be the greatest city in the world, and not just rest on its reputation, then it can’t settle.

Amazon wants to be the greatest company in the world, so it decided not to.

So much for Valentine’s Day. Amazon just gave NYC the kiss-off.