Updated: Amazon splitting HQ2 between New York City, Northern Virginia

By Tom Bergeron
Newark | Nov 13, 2018 at 6:56 am
Updated

(Editor’s Note: Amazon issued a formal announcement at 9:50 a.m. Tuesday. Read it here. Newark Mayor Ras Baraka and Gov. Phil Murphy issued statements later Tuesday morning.)

Newark Mayor Ras Baraka released a statement Tuesday on the city coming up short in the quest for Amazon’s HQ2 project. He doesn’t really need to.

Baraka has made his feelings known about the unprecedented nationwide courtship for a few weeks now — since word leaked out that Newark was not likely to get the big prize.

“In my mind, we won months ago,” he told ROI-NJ last week.

For Baraka, Newark made its mark just being one of the 20 finalists that were named in January for a project whose RFP said it was bringing 50,000 high-paying jobs and a $5 billion infrastructure investment to the winner.

As it turns out, Amazon threw a curveball. On Tuesday morning, it announced that the project would be split between Long Island City, Queens, and Crystal City, Virginia. The news had been reported earlier in the morning by numerous media organizations, including The New York Times, the Wall Street Journal and the Washington Post, which Amazon founder and CEO Jeff Bezos owns.

In its announcement, Amazon also said Nashville, Tennessee, would be the site of an Operations Center of Excellence, with 5,000 jobs coming to that facility.

“I want to thank Amazon for considering Newark for HQ2,” Baraka said in his statement Tuesday morning after the formal announcement. “The attention that Amazon brought to Newark by keeping us under consideration down to the wire greatly helped us showcase our city’s unprecedented progress and attractiveness to technology and other businesses. I also want to thank the governor, our federal and local legislators, our business community, clergy, colleges and universities for their unprecedented collaboration in the campaign to attract Amazon.

“News that Newark was a finalist highlighted our key advantages: proximity to New York City at a more affordable cost, access to mass transportation, a talent pool fed by half a dozen colleges and an internet infrastructure that allows Newark to offer the fastest and broadest free outdoor Wi-Fi in the country, development opportunities including land with riverfront and park views, and our diversity, a large African-American and Hispanic population.

“Real estate professionals tell us that other corporations have been taking a look at Newark, and several are strongly considering relocating to the city, since Newark was named as one of the 20 finalists.”

Gov. Phil Murphy also addressed the Amazon decision, issuing a statement of his own, and then elaborating at an event late Tuesday morning in Jersey City.

“Regardless of today’s announcement, Newark is undoubtedly stronger and has benefited tremendously from the spotlight it has been under for more than a year,” Murphy said in his statement. “New business inquiries are up significantly. Because of our collaborative, all-in effort, now everyone knows that not only is Newark a city on the rise, but that New Jersey’s cities have the tools to be homes for leaders in the global innovation-driven economy.

“We are investing again in our people and our infrastructure. We are on the radar of more companies that prize top-tier talent, a diverse workforce, strong communities and unparalleled access to the world’s largest markets. We have a new spirit and a comprehensive new plan focused on building both a stronger and fairer economic future and thriving cities and communities.

“Newark and New Jersey may not be getting HQ2, but our proximity to Queens means we’re certainly going to benefit.”

Indeed, the decision may not be a total loss for New Jersey.

The inclusion of Long Island City may actually make New Jersey a partial winner, as most experts feel one area — even one as big as New York City — cannot handle an influx of 25,000 workers.

That means Newark — as well as North Jersey communities like Harrison and Jersey City and, really, any place from which people are willing to commute to the city — could benefit from an increase in housing demand.

In addition, ROI-NJ reported last week that numerous Newark and state officials were pursuing options to partner with New York City even before the announcement was made.

One source, who requested anonymity because they were not authorized to speak on the subject, told ROI-NJ that New Jersey has plenty to offer a winning Long Island City bid.

In fact, they said Newark would go into the talks as a nearly equal partner.

“If you’re going to talk about the spillover effect, it’s a spillover into an equally big glass,” they said. “The real estate prices are cheaper (in New Jersey).

“When you look at the tech ecosystem in New York and you look at the way our ecosystem is beginning to thrive, equally, it makes total sense to have any spillover and contiguous jobs fall into New Jersey versus anywhere else in the tri-state area. Our trajectory is paired with theirs, it’s not second fiddle to theirs.”

It’s unclear where those talks are now — only that Newark and state officials will be eager to continue them.

Newark was considered a longshot for the project since Amazon stunned the economic development world in September 2017 by announcing it was seeking a location for a second headquarters.

The announcement led to a Willy Wonka-like pandemonium of interest from municipalities big and small throughout North America. New Jersey alone had more than a half-dozen areas submit proposals, though only Newark’s came with the state’s blessing.

When Newark was announced a finalist in January, most of the country was stunned.

Those who work and live in the city were not.

The trajectory of the city, they said, never has been greater.

Peter Bronsnick, executive vice president of SJP Properties, said Amazon’s interest in Newark was a natural continuation of what has been going on.

“Newark was on an upward trajectory well before the Amazon HQ2 search was even announced, but there’s no question that being shortlisted during that process helped to raise the city’s profile considerably — and in a very positive way,” he said.

“Newark’s resurgence is a testament to everyone’s collective efforts, especially the community leaders.”

Aisha Glover, now the head of the Newark Alliance and the person who led the city’s effort as the head of the Newark Community Economic Development Corp., summed it up another way earlier this year.

Glover, speaking shortly after Newark was named a finalist, said her phone rang off the hook so much after Newark made the final 20 that it led to a new phrase — and a new website: Yes, Newark.

Glover said the most telling moments came when the person on the other end — the one who initiated the call — was silent, trying to process the information.

“Really? Newark?” she said they eventually would say.

“Yes, Newark,” Glover would then say back to them.

Glover said she was happy to spend time educating them, talking about how Newark has the third-largest port in the U.S. (the biggest on the East Coast) and is the fifth-largest college town and the most ethnically diverse city in the country.

“All of these factoids, people just have no idea,” she said. “Once you peel back the concerns or misperceptions about public safety, we really fit that textbook definition of a city you want to be in. There’s definitely been a lot of shock.”

Which leads to the pause.

“People say, ‘Wow, I had no idea,’” she said.

“We came up with the campaign called, ‘Yes, Newark.’ Because everybody kept saying, ‘Really? Newark? Are you sure?’

“We just say, ‘Yes, Newark.’”

The ramifications of Newark making the final 20 may be felt for years — inside and outside of the state.

Barbara Kauffman, executive vice president and chief operating officer of the Newark Regional Business Partnership, said last week that Newark’s bid for Amazon not only introduced many areas of the country to the new Newark, it also reminded those who live and work in the city each day what it has become.

Kauffman said she’s ready to get to work to help land the next company.

“Now it’s time to show that there’s plenty of companies that we can land,” she said. “Whether or not Amazon comes here, we have the opportunity to have a lot more companies coming.”

The pitch, she said, will be easy.

“We knew that we had all of these things, but when it was all put together in one package and we looked at, we said, ‘Hey, there is a lot to like about this place.’”

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