New York wants new Amazon HQ, says city beats the suburbs

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Employees of Amazon India are seen behind a glass bearing the company’s logo inside its office in Bengaluru, India, August 14, 2015. REUTERS/Abhishek N. Chinnappa/File Photo

New York City is officially throwing its hat in the ring to lure Amazon.com’s proposed second headquarters, hoping a large, diverse workforce, extensive university system, big-city living and status as an epicenter of industry will overcome its major drawback as one of the country’s most expensive housing markets.

The city is highlighting the example of Google, which has 5,000 employees in Manhattan, as a prime example of how West Coast tech can thrive in the Big Apple.

Another major selling point is that New York offers access to various industries Amazon is entering, including advertising, media, fashion, food and finance, Alicia Glen, the city’s Deputy Mayor for Housing and Economic Development, said in an interview.

“For a company like Amazon that wants to be in all of these different sectors, they have to be thinking this is a great place to put roots down for the next half century,” she said.

The city is seeking proposals from land owners, developers, business groups and others to find the best locations to rally behind to make a unified pitch; it could propose multiple locations in different boroughs. The city doesn’t plan to offer big financial incentives, considering New York an attractive enough location without them, Glen said.

“Kids want to work in NYC,” she said. “They don’t want to be in a suburban office park.”

Seattle-based Amazon last week solicited proposals for the headquarters, a project that will cost more than $5 billion, and create 50,000 jobs over the next 15 to 17 years. Politicians across the U.S. and Canada have eagerly expressed interest. New York has competition from big cities such as Boston and Chicago and smaller markets like Tulsa, Oklahoma, and Memphis, Tennessee. Amazon set an Oct. 19 deadline for proposals, and plans to make a decision next year. The company has said its criteria include a metropolitan area of at least 1 million people with an airport offering convenient flights to Seattle and Washington.

San Francisco and New York are at a disadvantage due to their high housing costs, which drives up salaries, said Mehul Patel, chief executive officer at Hired, which tracks salaries in the technology industry. Tech workers are taking pay cuts to move from expensive markets like San Francisco to more affordable industry hubs such as Austin, Texas, because the lower cost of living outweighs the pay cut, he said. That’s a factor that will influence Amazon’s choice, he said.

“Amazon is going to optimize for the lowest salaries and highest quality talent,” Patel said. “They’re enough of a brand name employer they can lure local graduates and recruit from bigger markets and they can pay less.”

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