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Amazon said to be reconsidering New York City headquarters

Amazon is said to be reconsidering its plans to open up a new campus in New York City’s Long Island City neighborhood after facing backlash from local residents, according to a Washington Post report on Friday.

The report, which cited unnamed sources, said Amazon executives have had discussions recently to rethink the company’s plans for New York and consider alternatives.

“We’re focused on engaging with our new neighbors — small business owners, educators, and community leaders,” an Amazon spokesperson said in a statement to CNN. “Whether it’s building a pipeline of local jobs through workforce training or funding computer science classes for thousands of New York City students, we are working hard to demonstrate what kind of neighbor we will be.”

Amazon selected New York City and Northern Virginia in November to split duty as its second headquarters (nicknamed HQ2) after a year-long search. Each city was expected to have more than 25,000 workers over time.

The New York Times reported Friday afternoon, citing two unnamed sources, that Amazon execs are frustrated with the cold reception the company has received in New York, but that the company is not currently planning to back out.

If Amazon is reconsidering its Long Island City campus, it’s not telling close partners on the project.

“We talk with the folks from Amazon all the time,” says Elizabeth Lusskin, president of the Long Island City Partnership, the local economic development organization. “As far as they say to us, everything is great, they’re excited about New York, they’re working hard to get to know the community and move things along.”

New York Governor Andrew Cuomo framed the original announcement as a tremendous job creation opportunity for the entire New York region. It also ignited a frenzy over real estate in both cities.

But critics objected to the massive subsidies New York offered to lure the tech behemoth.

New York State committed to $1.525 billion in incentives, contingent on the company creating 25,000 new jobs with an average salary of $150,000. Protesters took to the streets in Long Island City, criticizing the deal for being bad for taxpayers and the neighborhood.

Those critics got new hope earlier this week when New York State Senator Michael Gianaris of Queens, who is a vocal critic of HQ2, was recommended to serve on the Public Authorities Control Board.

The relatively unknown board weighs in on any financing and land use deals that run through public authorities, which primarily include economic development projects. It’s had some success in the past blocking major projects.

On Friday, Cuomo reacted angrily when asked during a pre-planned, unrelated news conference about the possibility that Amazon might bail on New York.

“For the state Senate to oppose Amazon was governmental malpractice,” Cuomo said. “And if they stop Amazon from coming to New York, they’re going to have the people of New York State to explain it to. It is irresponsible to allow political opposition to overcome sound government policy.”

Mayor Bill DeBlasio, who helped craft the HQ2 deal behind closed doors, expressed confidence that Amazon would still come to the city.

“The mayor fully expects Amazon to deliver on its promise to New Yorkers,” said his spokesman Eric Phillips in a statement.

Rep. Alexandria Ocasio-Cortez, who campaigned against the subsidy package, celebrated the news that Amazon may be reconsidering the whole deal. Her district borders Long Island City.

“I think it’s really encouraging to show that government and all of us primarily have a responsibility to the communities that we directly impact,” Ocasio-Cortez told CNN on Friday. “When we don’t consult with those communities, we absolutely need to reconsider those deals and that process.”

Unions, which have organized most of the deal opposition on the grounds that e-commerce destroys traditional retail jobs, said the Washington Post report suggests Amazon is threatening to pull the plug on the efforts to pressure New York politicians and galvanize support. Amazon has said publicly — most recently at a City Council hearing on the subsidies — that it opposes union drives at its warehouses.

“If the Amazon deal falls apart, they will have nobody to blame but themselves,” said Stuart Applebaum, president of the Retail, Wholesale and Department Store Union. “New Yorkers wont be bullied by Jeff Bezos, and if Amazon is unwilling to respect workers and communities they will never be welcome in New York City.”

Amazon, for its part, has tried to win over its future neighbors. Last month, it ran a print advertisement in some of New York’s biggest daily newspapers, wishing residents a happy New Year and pledging to work with and listen to the community.

Among other things, Amazon said it would hire from “across the five boroughs,” offer career training for local residents and bring in over $27 billion in state and local tax revenue that can help “improve subways and buses.”

If the deal does fall through, some fear it could have broader repercussions on New York’s ability to attract top corporations. “It’s setting a bad precedent,” Carlo Scissura, president and CEO, New York Building Congress, told CNN Business on Friday. “This is getting the business community very worried about the future of New York. ”

 

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