Amazon walks away from plans to build New York City headquarters due to the political climate

On Thursday, Seattle-based technology company Amazon announced it has ditched plans to build its second headquarters in New York City, saying it is "disappointed to have reached this conclusion." Senior economic analyst for Bankrate, Mark Hamrick, warned, ‘For those who didn’t want Amazon to bring the promised 25,000 new jobs and added economic vitality to the area: Be careful what you wish for.”

In a statement released by the company, Amazon said, "After much thought and deliberation, we’ve decided not to move forward with our plans to build a headquarters for Amazon in Long Island City, Queens. For Amazon, the commitment to build a new headquarters 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."

According to a December Quinnipiac University poll, 57 percent of New York City residents support Amazon’s arrival, compared to just 26 percent who oppose the deal. Announcing its intended investment last November, Amazon’s HQ2 would've brought 25,000 jobs and USD $2.5 billion in corporate investment, with an eventual 8 million square feet of office space to Long Island City. Amazon said it would have generated "incremental tax revenue of more than $10 billion over the next 20 years as a result of Amazon’s investment and job creation."

However, the decision came after relentless opposition from politicians, most notably newly elected Democratic Congresswoman Alexandria Ocasio-Cortez, who is currently the most high-profile progressive and anti-corporate politician in Congress. Political opposition against HQ2 has been mounting since a New York City Council meeting in December where Amazon’s executives were hounded and jeered and refused to support unionization of its workers, a progressive pillar of the region at all levels of government. Earlier this month, reports surfaced that Amazon was reconsidering its plans for its New York office, which led to cheers from Ms. Ocasio-Cortez, who tweeted, "Can everyday people come together and effectively organize against creeping overreach of one of the world’s biggest corporations? Yes, they can."

When the deal was first announced, New York Governor Andrew Cuomo and New York City Mayor Bill de Blasio had touted the benefits of HQ2, which included a pledge from Amazon to create 25,000 jobs, paying an average of USD $150,000 per year in exchange for a USD $3 billion incentive package that included city and state tax breaks and subsidies. The top issue for progressives is disallowing big corporations to benefit from what they consider to be at the expense of regular people. Yet, New York City Mayor Bill de Blasio, who presents himself as the leader of the progressive movement, signed onto the deal, though he later backed off when faced with massive progressive opposition. Concerns were also raised over how HQ2 could impact already rising real estate prices in the area. On this issue, Amazon had primarily negotiated with Governor Cuomo, who only has authority over the executive branch of state government and none over the state legislature, the City Council, or the congressional delegation.

"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," the company continued in the statement. In response, Mayor de Blasio said, “You have to be tough to make it in New York City. We gave Amazon the opportunity to be a good neighbor and do business in the greatest city in the world. Instead of working with the community, Amazon threw away that opportunity. We have the best talent in the world and every day we are growing a stronger and fairer economy for everyone. If Amazon can’t recognize what that’s worth, its competitors will.”

Amazon said it would proceed as planned with the second part of its HQ2, which will be built in Northern Virginia, as well as its distribution center that it said it would open in Nashville. It will also continue to "hire and grow across our 17 corporate offices and tech hubs in the U.S. and Canada."