Amazon Splits the HQ2 Baby, Rich-Get-Richer Style

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Amazon's trip to Queens has been met with some pushback.Xavier Harding/MicAmazon sign at the rally in Long Island City, New YorkXavier Harding/Mic " Greed kills LIC" sign at the Amazon rallyXavier Harding/MicAmazon boxes at the anti-HQ2 rallyXavier Harding/MicNew York City Council member Jimmy Van Bramer and state Sen.

"I doubt big tech is anxious, but they will be more aware of the competitive landscape when it comes to strategies for recruiting technical talent given Amazon will be offering very similar incentives", said Will Potter, co-founder of the NY executive recruiting firm Bamboo Talent, referring to incentives that include salary, high-performing restricted stock units and the ability to work on wide-reaching products. Even still, residents of Long Island City voiced their frustration with big tech entering the neighborhood.

"That reflects that talent was really the driving factor for us", Carney said. "For a high-cost market like Long Island City, incentives are a necessarily evil". And JBG Smith, the developer that will be working with Amazon to build its new complex, in May announced an effort to preserve and construct low-priced housing in the surrounding area.

The chosen locations are Long Island City neighborhood in the NY borough of Queens, across the East River from Manhattan, and the Crystal City section of Arlington, Virginia, across the Potomac from the U.S. capital. The Downtown Seattle Association said more than 2,000 small businesses have opened in downtown Seattle since Amazon showed up.

But investors were already pouncing. Both have been promised 25,000 good-paying jobs and help in attracting potentially billions of dollars in private investment.

The two tech giants can offer working conditions "that are much more pleasant than those on Wall Street", Pollak said. With Amazon moving in, he said, he sees another reason to take a risk: a "captive audience" of workers looking for apartments and shops.

Virginia's per-job incentive is effectively only about a third of what Amazon is getting from NY, where Amazon is also planning a new 25,000 employee expansion. They get to exclude up to 15 percent of those gains from taxes. Meanwhile, the average cost of a single-family house has increased by almost 90 percent to an average price of $844,000. But other business and individual taxes are higher in NY.

"National Landing is an urban community in Northern Virginia located less than 3 miles from downtown Washington, D.C.", Amazon wrote in its announcement.

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"I was surprised the package wasn't bigger", said John Boyd, a site selection consultant who wasn't involved in the Amazon search. "It cannot be that the mayor and governor and Jeff Bezos - literally three men in a room - can conspire to give him $3 billion and a helicopter pad, because who wants to struggle taking the subway?" I asked, referring to the reality TV show in which singers compete for a recording contract.

"If they see there's a crunch for talent, they're going to have to be more competitive and obviously the easiest way to be more competitive is to pay people more", she said.

One such subsidy comes courtesy of New York City's Relocation and Employment Assistance Program.

A separate study commissioned by the state predicted that Amazon would generate $186 billion for the state economy over the next 25 years. Once a lonely figure, the building has suddenly been thronged by dozens of newer office towers as the neighborhood just across the East River from Manhattan has boomed in the last few years.

"That kind of opportunity zone already has lots of opportunity", said Brett Theodos, a research associate with Brookings' Metropolitan Housing and Communities Policy Center.

Public officials and locals to Long Island City, New York, raised their voices Wednesday in protest of the company coming to Queens.

That makes the area too wealthy to qualify for tax breaks on its own, but the tax law allows such areas to piggyback on nearby ones that do qualify. At 6.5 per cent, New York's corporate income-tax rate is only modestly higher than Virginia's 6 per cent, according to the Tax Foundation.

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