Sep 8, 2017

5 potential contenders for Amazon's next headquarters

AP

Amazon's search for a second headquarters has cities across the country scrambling to roll out the red carpet for the company, which promises to bring 50,000 new jobs and $5 billion investment — and immediate "tech hub" cred that so many communities covet. Based on the criteria Amazon provided, as well as the tech giant's political reality, we came up with a list of top five possible contenders to become Amazon's second mothership.

The five cities: Denver, Chicago, Phoenix, Minneapolis and Detroit.

Criteria: While Amazon was purposefully vague about it's criteria, it was clear about a few preferred traits.

  • More than 1 million people
  • The ability to "attract and retain strong technical talent," including a strong university system
  • Stable, business-friendly environment and "creative thinking" when it comes to real estate development
  • Cultural fit for Amazon, including a diverse population
  • Functional local transit system, which we evaluated using the AllTransit score that measures frequency of transit trips in an area and the number of jobs accessible through transit
  • An international airport with daily flights to Seattle, New York, San Francisco and Washington, D.C.

The contenders, explained:

Denver: Denver had the highest public transportation score of the metropolitan areas we vetted. It was also number five on TechNet's list of current tech hubs.

  • Who else is there: DISH Networks, Liberty Interactive and internet backbone company Level 3 are all in the Denver area.
  • Are they interested?: Yep. Aurora Economic Development Council president Wendy Mitchell said the agency will "absolutely be bidding on this RFP."

Chicago: The city includes or is next to several renowned private universities, and has strong public transportation.

  • Who else is there: Big companies like Boeing and ConAgra.
  • Are they interested?: Mayor Rahm Emanuel is already lobbying Bezos.

Phoenix: The metro area has access to two major state university systems.

  • Who else is there: Retailer PetSmart and Swift Transportation, a major trucking company.
  • Are they interested?: The city said in a statement it plans to bid on the headquarters and believes it will be competitive.

Minneapolis: Home to the University of Minnesota and number 33 on TechNet's list of emerging technology hubs.

  • Who else is there: Target — which, obviously, competes with the web retail giant.
  • Are they interested?: Yes, the Twin Cities are bullish on Amazon.

Detroit: Detroit ranks lower on TechNet's list of hubs but has a major university in Wayne State (and, statewide, Michigan State and the University of Michigan) and a history as a center of American industry.

  • Who else is there: Dan Gilbert's Rock Ventures and pretty much the entire American automotive industry.
  • Are they interested?: Detroit is "carefully" looking at Amazon's request.

Our analysis: We ranked major metropolitan areas based on the criteria above, and eliminated cities in coastal states. Amazon is running into more scrutiny for its growing dominance, and it knows expanding into cities and states that have largely been left out of the tech boom will serve it well. For that reason we eliminated cities in states like California, New York and Massachusetts. We also took into account cultural and diversity factors, including local anti-discrimination ordinances, and how it ranks on lists of emerging tech hubs due to the talent those cities attract.

Caveat: This is by no means an exhaustive evaluation, but rather a cursory (and, we admit, somewhat arbitrary) look at where Amazon may be headed.

Other cities: Of course, other cities will make attractive bids.

  • Philadelphia and Baltimore are close to strong university ecosystems, have decent public transportation, and are situated between New York and Washington. But they're on the eastern seaboard, and we suspect Amazon is more likely to choose a city in a non-coastal state.
  • Texas has three cities that would certainly love to appeal to Amazon: Houston, Austin and Dallas. But Houston doesn't have anti-discrimination laws that protect people on the basis of gender identity and sexual orientation. (North Carolina cities have this downside, too, thanks to the state government's stance.) Dallas, like Atlanta, doesn't have great metro area transportation scores (according to AllTransit).
  • Mid-sized midwestern cities like Columbus and Kansas City have educated workforces and are seen as emerging tech centers, but flights to Amazon's required destinations are more limited than other cities' airports.
  • Toronto is an intriguing option if Amazon is looking outside the states for a North American headquarters. It has well-known universities, public transit and a strong technical talent pool.

At the end of the day: Amazon's choice will at least in part boil down to the tax breaks a city is willing to offer.

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