Amazon Seeking 2nd Headquarters: Canadian Cities Pitch Interest

[mistercorporate]

Originally Posted by travis3000

Agreed. The proposal doesn't look bad to be honest. But the reality is, while Canada may be in the running, I think the ultimate decision will send this thing to the US. Anywhere in the west will be ruled out, they need an East Coast location. So Boston, Detroit, Washington, Cincinnati, Pittsburg, Philadelphia, NYC. It'll end up in one of those areas.

Personally, I think Toronto has as good a chance as any of those cities, it's just that the criteria is so open that there are so many candidates. One Canadian city vs a dozen or so American cities makes this a longshot.

[SpongeG]

The War to Woo Amazon's HQ2 is Going to Result in a Ridiculous Rise in Rents

Yesterday was the last day for cities across the country to submit their bids to woo Amazon to build its second world headquarters, dubbed HQ2, in their region — a heated battle for the $5 billion investment and 50,000 new jobs promised by the e-commerce retail giant.

But not everyone will benefit from the addition of Amazon HQ2 to their urban area. A new report from Business Insider (using data from Apartment List) shows that rents could rise astronomically — around $200 or more per month — in whichever of the 15 cities most likely to become Amazon's new home ends up winning their bid.

For those who land one of the thousands of new white-collar jobs averaging $100,000 per year, the monthly budget may still work in their favor. But for everyone else, it could be a serious shock to the system.

Most-expensive cities like Boston, where median rent is already $1,969 per month with an existing annual rent increase of up to 0.8%, and San Jose, where median rent is already $2,691 per month with an existing annual rent increase of up to 1.6%, would be hardest hit — but a $200 per month rent increase in economically struggling cities like Detroit, where median rent is $998, would be tantamount to a nearly 20% rent increase almost overnight and could be catastrophic for existing city residents who don't get one of those coveted Amazon jobs.

...

http://www.apartmenttherapy.com/the-...n-rents-251634

[Acajack]

Originally Posted by mistercorporate

Personally, I think Toronto has as good a chance as any of those cities, it's just that the criteria is so open that there are so many candidates. One Canadian city vs a dozen or so American cities makes this a longshot.

I agree with you.

We also have no idea if the fact that a city is located in Canada is a positive or a negative in their eyes. Maybe they themselves don't know yet.?

[esquire]

Originally Posted by mistercorporate

Personally, I think Toronto has as good a chance as any of those cities, it's just that the criteria is so open that there are so many candidates. One Canadian city vs a dozen or so American cities makes this a longshot.

News reports say that NJ offered something on the scale of $7B in tax breaks to Amazon... would any Canadian jurisdiction exceed that?

I think Manitoba offered $1.7B, really not even in the same ballpark.

[Acajack]

Originally Posted by esquire

News reports say that NJ offered something on the scale of $7B in tax breaks to Amazon... would any Canadian jurisdiction exceed that?

I think Manitoba offered $1.7B, really not even in the same ballpark.

Perhaps not but there may be other cost factors that other cities have that can balance things out a bit.

In the final analysis I see Toronto as the only serious Canadian contender for this, with Ottawa as a potential no. 2 dark horse.

[esquire]

^ But everyone outside of Toronto thinks their city is the potential #2 dark horse after Toronto

[Acajack]

Originally Posted by esquire

^ But everyone outside of Toronto thinks their city is the potential #2 dark horse after Toronto

I'd say some Canadian cities think they're no. 1 *ahead* of Toronto on this one!

Seriously though, my second place ranking of Ottawa(-Gatineau) isn't homerism. I just think that Amazon wants to be on the eastern side of the continent for this one.

Montreal probably checks off more boxes (or at least as many) than Ottawa does but I don't think Amazon would want to deal with the language issue - not for a second corporate HQ with 50,000 people working in it, anyway.

[esquire]

Seems that the three biggest Canadian cities have major knocks against them... Van., too close to Seattle/crazy housing costs. Toronto, ditto on housing. Montreal, language issues.

I honestly wonder if the "next three", i.e. Calgary, Edmonton, Ottawa stand the most realistic shot out of Canada's cities? I would think Alberta could throw some real money at Amazon too, and all 3 cities have sizable corporate presences where you could draw business and IT expertise from. There is also good transit, plenty of office space and enough affordable housing to make it appealing.

If Toronto's housing market wasn't so bonkers, I would think they'd be hands down the leader of the pack among Canadian cities.

[geotag277]

Originally Posted by esquire

News reports say that NJ offered something on the scale of $7B in tax breaks to Amazon... would any Canadian jurisdiction exceed that?

I don't believe a single Canadian city offered tax incentives, because their hands were tied. The Federal government said they weren't supporting any bids with tax incentives unless the city in question was short listed, and I believe municipalities were the same regarding their provincial relationships.

[esquire]

^ If Manitoba offered $1.7B in credits and incentives, surely someone else in Canada must have too?

EDIT: OK, I took a look and it seems that they're referring to existing credits/incentives. So it's still something, but just not specific to Amazon. But a subsidy is still a subsidy, no?

http://www.winnipegsun.com/2017/10/1...n-amazon-pitch

The bid also estimates Amazon could qualify for roughly $1.7 billion in federal and provincial financial incentives through existing research and development tax credits and job-training subsidies.

[mistercorporate]

Originally Posted by esquire

News reports say that NJ offered something on the scale of $7B in tax breaks to Amazon... would any Canadian jurisdiction exceed that?

I think Manitoba offered $1.7B, really not even in the same ballpark.

Our consistently lower Canadian dollar, lower corporate taxes, free medicare and significantly lower tech/management wages gives us conservatively about $2 billion in savings per year vs any American city. That's about $10 billion in the first 5 years alone.

[Acajack]

Originally Posted by esquire

Seems that the three biggest Canadian cities have major knocks against them... Van., too close to Seattle/crazy housing costs. Toronto, ditto on housing. Montreal, language issues.

I honestly wonder if the "next three", i.e. Calgary, Edmonton, Ottawa stand the most realistic shot out of Canada's cities? I would think Alberta could throw some real money at Amazon too, and all 3 cities have sizable corporate presences where you could draw business and IT expertise from. There is also good transit, plenty of office space and enough affordable housing to make it appealing.

If Toronto's housing market wasn't so bonkers, I would think they'd be hands down the leader of the pack among Canadian cities.

Is Toronto's housing market really that bonkers in comparison with some of the most prestigious US cities, especially in the NE and factoring in the currency difference and stuff like universal health care?

[geotag277]

Originally Posted by SpongeG

could be catastrophic for existing city residents who don't get one of those coveted Amazon jobs.

I'm curious how the job poaching angle is going to play out. If you look at markets like Boston and Toronto, they are already very competitive for senior engineers. It's not like senior top tier engineers in these cities aren't already making boatloads of cash in senior positions at world leading technology companies. The engineers Amazon is likely to poach in these places are probably not going to be the best of the best, and further, to really land the best, they are going to have to pay through the nose. This is assuming they want to meet their four figure hiring targets in the short term by leaning on a poaching strategy.

Whereas in places like Detroit and Calgary, most engineers are working for places like automobile companies and banks and telecommunications and oil and gas - in other words, reasonably paying gigs but technology dinosaurs in a sense (read: boring). I think the argument for Amazon poaching talent is much stronger in these cities, because they don't have the same competitive tech landscape already built in.

[geotag277]

Originally Posted by mistercorporate

Our consistently lower Canadian dollar, lower corporate taxes, free medicare and significantly lower tech/management wages gives us conservatively about $2 billion in savings per year vs any American city. That's about $10 billion in the first 5 years alone.

They also have to think about bringing in a bunch of engineers and senior leadership from the USA into their HQ2 in Canada. Are Americans really going to be gung ho about crossing the border and being paid in Canadian dollars as well? Especially top engineers/management/leaders who have their pick of opportunities?

[mistercorporate]

Originally Posted by geotag277

I'm curious how the job poaching angle is going to play out. If you look at markets like Boston and Toronto, they are already very competitive for senior engineers. It's not like senior top tier engineers in these cities aren't already making boatloads of cash in senior positions at world leading technology companies. The engineers Amazon is likely to poach in these places are probably not going to be the best of the best, and further, to really land the best, they are going to have to pay through the nose. This is assuming they want to meet their four figure hiring targets in the short term by leaning on a poaching strategy.

Whereas in places like Detroit and Calgary, most engineers are working for places like automobile companies and banks and telecommunications and oil and gas - in other words, reasonably paying gigs but technology dinosaurs in a sense (read: boring). I think the argument for Amazon poaching talent is much stronger in these cities, because they don't have the same competitive tech landscape already built in.

Realistically, Amazon is an average brand from a marketability and payscale perspective. If I was still an early career engineer or management type, looking to fill my resume with good brands, Amazon wouldn't be my first choice, or even a top 10 choice.

That said, Toronto has a huge glut of engineering and MBA talent, seriously underpaid by North American standards. $100,000 is peanuts for an educated professional with a couple years of work experience. If Amazon came in handing out $100,000 on average among its 50,000 new employees, it would create much needed wage inflation that would boost incomes at all wage levels.

It wouldn't grab the top talent, that goes to companies that pay appropriately, but they will get better talent than they'd get just about anywhere else, for the price.

[mistercorporate]

Originally Posted by geotag277

They also have to think about bringing in a bunch of engineers and senior leadership from the USA into their HQ2 in Canada. Are Americans really going to be gung ho about crossing the border and being paid in Canadian dollars as well? Especially top engineers/management/leaders who have their pick of opportunities?

I have a bit of experience with this, one can build up and scale a relatively large organizational apparatus with as few as 10 senior professionals from the parent company. The rest can be sourced locally and trained remotely, which is kind of the point of getting a second headquarters.

As far as Americans crossing the border, this isn't 2007 anymore. Toronto is a different city, most Americans visiting now fall in love with the place, it has a lot more polish and dynamism and quality of life than most major American cities.

[Black Star]

Originally Posted by esquire

Seems that the three biggest Canadian cities have major knocks against them... Van., too close to Seattle/crazy housing costs. Toronto, ditto on housing. Montreal, language issues.

I honestly wonder if the "next three", i.e. Calgary, Edmonton, Ottawa stand the most realistic shot out of Canada's cities? I would think Alberta could throw some real money at Amazon too, and all 3 cities have sizable corporate presences where you could draw business and IT expertise from. There is also good transit, plenty of office space and enough affordable housing to make it appealing.

If Toronto's housing market wasn't so bonkers, I would think they'd be hands down the leader of the pack among Canadian cities.

Agree....this makes good sense.

[SteelTown]

We have a winner...

Stonecrest, Georgia

In perhaps the most outrageous stunt to take home the grand prize, Stonecrest is offering to change its name to Amazon.

Yes, seriously.

The new city, incorporated in 2016,has offered to dedicate 139 hectares of the city for use by the company, and has offered to install Bezos as the de-facto mayor of Amazon.

https://www.thespec.com/news-story/7...craziest-ones/

[Acajack]

Originally Posted by mistercorporate

I have a bit of experience with this, one can build up and scale a relatively large organizational apparatus with as few as 10 senior professionals from the parent company. The rest can be sourced locally and trained remotely, which is kind of the point of getting a second headquarters.

As far as Americans crossing the border, this isn't 2007 anymore. Toronto is a different city, most Americans visiting now fall in love with the place, it has a lot more polish and dynamism and quality of life than most major American cities.

I also don't see Amazon bringing 10,000, 20,000 or whatever thousand Americans across the border if they choose a Canadian city. Most of the HR will be sourced locally or nationally within Canada I presume, with some people brought in from the U.S. of course, and also maybe people who will move from outside North America to come work in Canada.

Doesn't sound like a huge issue - if that's the route they choose.

[Acajack]

Originally Posted by mistercorporate

Realistically, Amazon is an average brand from a marketability and payscale perspective. If I was still an early career engineer or management type, looking to fill my resume with good brands, Amazon wouldn't be my first choice, or even a top 10 choice.

That said, Toronto has a huge glut of engineering and MBA talent, seriously underpaid by North American standards. $100,000 is peanuts for an educated professional with a couple years of work experience. If Amazon came in handing out $100,000 on average among its 50,000 new employees, it would create much needed wage inflation that would boost incomes at all wage levels.

It wouldn't grab the top talent, that goes to companies that pay appropriately, but they will get better talent than they'd get just about anywhere else, for the price.

I've always heard that Canada was a pretty good deal for international corporations in terms of how much they have to pay (relative to other places) for good talent here.