Market Overview

Amazon HQs Are Coming To The East Coast

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Amazon HQs Are Coming To The East Coast

Amazon.com, Inc. (NASDAQ: AMZN)'s quest to find a second and third home on the East Coast has come to an end.

What Happened

Amazon said it will open two new headquarters in New York City's Long Island region and Arlington, Virginia. The company will invest $5 billion in the two regions, which is expected to create more than 50,000 new jobs across the two cities.

Amazon will receive direct incentives of $1.525 billion from NYC over the next 10 years and will be based on generating 25,000 new jobs with an average wage of over $150,000. The company will receive $573 million in direct incentives from Virginia based on expectations for a similar creation of 25,000 jobs with an average wage of over $150,000.

In conjunction with the announcement, Amazon also said it will open a new "Center of Excellence for its Operations business" in Nashville, Tennessee. The company will create 5,000 new jobs who will oversee customer fulfillment, transportation, supply chain and other similar activities.

Why It's Important

Amazon CEO Jeff Bezos said its decision is based on the cities ability to attract world-class talent that will help "inventing for customers for years to come."

New York Gov. Andrew Cuomo said the city of New York "can proudly say that we have attracted one of the largest, most competitive economic development investments in U.S. history." The region is well positioned to partner with Amazon to ensure a long-term successful relationship.

Virginia Gov. Ralph Northam said Amazon recognizes the state's "new model of economic development for the 21st century" and represents a "big win for Virginia."

What's Next

A notable concern ahead of Amazon's announcement was the impact on housing costs. According to PayScale's vice president of data analytics Katie Bardaro, the impact to housing prices is likely to be smaller than existing homeowners are hoping for, MarketWatch reported.

Housing prices could rise near the headquarters although it won't be sudden and it could be possible the sudden migration of highly paid workers can have "negative effects on local economies."

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Victor Anthony Says Buy Into Amazon's Weakness, Raises Target To $2,225

Brooklyn Bridge, Spanning East River between Brooklyn & Manhattan, New York City. Photo courtesy of the Library on Congress.

Posted-In: Amazon Headquarters Amazon HQ2 Jeff Bezos New York City virginiaNews Top Stories Media Best of Benzinga

 

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