After Amazon’s September announcement to construct its new headquarters, dubbed Amazon HQ2, cities and regions across the continent completed and submitted Phase I bids by the October 19 deadline. According to Amazon, the company received 238 proposals from states, regions and provinces throughout North America.
With a plan to establish this second headquarters, Amazon offers one location in North America the opportunity to reap great benefits from its continued expansion. But does Houston have a realistic shot at being a contender for the new headquarters?
Amazon’s Investment and Requirements
Amazon plans to invest $5 billion to construct the new base and add as many as 50,000 new jobs. Amazon has stated a need for 500,000 plus SF by 2019 with a view to an additional 8,000,000 SF in the following years.
The site also requires a metropolitan area with over 1 million residents and a stable, business-friendly culture. HQ2 also needs to be within 30 miles of a population center, within 45 minutes of an international airport, near major highways and roads and have access to mass transit routes.
Additional Benefits of HQ2
With so much to gain, the competition for HQ2 is fierce. In addition to the direct investments listed above, HQ2 could indirectly add tens of billions of dollars to the chosen location and create tens of thousands of additional jobs.
In Seattle, which hosts Amazon’s current headquarters, over 50,000 jobs have been created from direct investment. Those jobs are in addition to 40,000 Amazon jobs. Also, Amazon’s direct investments have added $38 billion dollars to the local economy. Furthermore, non-Amazon employees have seen a $17 billion increase in their personal income due to Amazon’s direct investments.
A Chance for Houston
Facing competition from over 54 states, provinces and territories, the city of Houston hopes its proposal can be seriously considered. The mayor’s office is not inclined to disclose the specifics of its bid. However, the city of Houston is highlighting innovation, diversity and the city’s strong ties to the global economy. One possible site is the East River being developed by Midway. If Houston were chosen for HQ2, it could trigger a new era of growth in the city.
Another bid has been submitted by leaders in the northeast community of Lake Houston. Letters from both Ryan McCord (president of McCord Development) and Mark S. Mitchell (president of the Lake Houston Economic Partnership) ask Amazon to consider Lake Houston’s Generation Park for HQ2. The 4,000 acre development is near both the Houston Ship Channel and Bush Intercontinental Airport.
More of Everything
Although adding 50,000 jobs sounds like a lot, it is unlikely that all of these would be taken by locals. As a result, 50,000 new jobs will probably draw workers from across the region, maybe even from around the nation. New residents relocating to Houston would require more of everything – more public services, more schools, more healthcare and more infrastructure.
Houston’s housing industry would be one of the largest sectors to benefit from an influx of people. If chosen for HQ2, numerous industries including commercial real estate, residential real estate, the apartment market, the construction industry, construction suppliers and many others could experience rapid growth in Houston. It is also possible that Houston’s rents could rise across the board based on the law of supply and demand.
A Boon for the Selected City
No matter which location Amazon chooses for HQ2, landing it will be a tremendous boon for selectee. If chosen, Houston would benefit directly and indirectly from Amazon’s investments. HQ2 would also bring other, additional benefits to the city as well.