Hey, Amazon, Look at Us. South Florida Seeks the Tech Giant’s Second HQ
October 21, 2017
In advance of a Thursday deadline, South Florida has submitted its proposal to lure Amazon’s highly coveted second headquarters, along with potentially hundreds of North American cities and metropolitan areas competing for the e-commerce gorilla’s $5 billion campus. The stakes are high: The award is expected to bring up to 50,000 jobs averaging more than $100,000 annually to the winning community.
Think about that: If the headquarters, dubbed HQ2, were to come to Miami-Dade, for instance, that would increase the number of people making that level of salary in the county by about 60 percent. The percentage is similar in Broward, according to the state statistics.
“That is an unprecedented boost to the area that you can almost never get in one shot. This really is a huge, huge opportunity. It addresses what I think is the region’s most pressing economic development issue, which is creating high wage, high skilled jobs — that would do it,” said Kevin Greiner, a senior fellow at the Florida International University Metropolitan Center.
Odds makers — in this case, ratings firm Moody’s, the Brookings Institution, Anderson Economics Group and national site selection firms — rate Miami as high as No. 7 among candidates, and as low as nowhere on the list for the Seattle-based giant’s second North American headquarters. Other contenders frequently mentioned include Denver, Austin, New York, Philadelphia, Atlanta and Chicago.
50,000 Number of high-paid jobs Amazon’s second headquarters may bring.
The South Florida community’s proposal will include Miami-Dade, Broward and Palm Beach counties. According to Miami-Dade Beacon Council CEO Michael Finney, who is leading the effort, the region submitted eight sites for consideration: five in Miami-Dade, two in Broward and one in Palm Beach. Finney said that he can’t talk about the specifics of the proposal or the sites, as that is a requirement of Amazon. Amazon is expected to make its choice in 2018.
The Miami Herald has not seen the Amazon proposal, but Doral Mayor Juan Carlos Bermudez said the previously reported Codina Partners project in Downtown Doral is included.
“We believe ours is a very strong proposal at the national and local level because we are probably one of the only places that has almost 50 shovel-ready acres ready to go for offices — with housing around it — in Downtown Doral,” said Bermudez, adding that adjacent land is available for phase two. “Obviously I’d love to have it in Doral but South Florida needs the high-skilled, high-wage jobs that Amazon is offering.”
According to sources, the Beacon Council proposal includes at least one site in downtown Miami. A video produced by the Downtown Development Authority narrated by Knight Foundation President Alberto Ibargüen and featuring Miami residents embracing the downtown lifestyle is part of the package.
Miami City Commissioner Ken Russell, chairman of the Miami Downtown Development Authority, wouldn’t talk about specific sites, but said the DDA compiled a universe of properties, both government and privately owned, that could be put on the table. He said the Brightline train that will soon link Miami’s urban core with Metrorail and Metromover, Fort Lauderdale and Palm Beach should be attractive to Amazon.
“There are a lot of cities that are showing off for Amazon … We took a different approach. We put out a challenge,” Russell said. The message of the video, he said: Miami isn’t for everybody and if you are not welcoming of diversity, don’t come. “We believe that will resonate with Amazon because they do embrace a lot of the values that we have in Miami and they will recognize how this is really a jumping off point not only for South America but for Europe and the world.”
Broward’s economic development agency, the Greater Fort Lauderdale Alliance, declined an interview request Wednesday, deferring to the Beacon Council for information, but sent this statement from President Bob Swindell: “We’re optimistic about the sites and assets provided in the proposal, and our goal now is to be included in the company’s second round of consideration, to have more opportunities to showcase all of the advantages of doing business in South Florida.” Palm Beach County’s Business Development Board did not respond to a request for comment.
The Miami area proposal is one of four that will be submitted by the state of Florida as a package, along with bids from Jacksonville, Orlando and Tampa Bay, said Finney. The Beacon Council is Miami-Dade’s economic development organization.
“We’ve got a ready and willing, capable workforce that is skilled in all the disciplines that a world-class tech company like Amazon would look for,” said Finney, who previously led economic development efforts for the state of Michigan and Rochester, N.Y. “We are multilingual, and we cover multiple disciplines from software and IT to virtual reality and artificial intelligence and all the traditional business disciplines.
“I CAME TO MIAMI BECAUSE I FELT THERE WAS INCREDIBLE UPSIDE POTENTIAL FOR THIS REGION. … WE HAVE TO TELL OUR STORY MORE EFFECTIVELY.” Michael Finney, Miami-Dade Beacon Council
“I came to Miami because I felt there was incredible upside potential for this region. I felt like the world didn’t know the business opportunity that exists here and I feel even more like that today having gone through this process,” added Finney, who moved to Miami to head the Beacon Council this summer. “We have to tell our story more effectively.”
According to Amazon’s request for proposal, the company is seeking to open its second headquarters in a metropolitan area with more than one million people and a stable and business-friendly environment that can attract top tech talent. It wants communities to think “big and be creative” about real estate options — both urban and suburban locations were requested — and incentive packages. It is also looking at education systems, cost of living, mass transit, proximity to the airport, cultural opportunities and quality of life, among other factors.
Local community leaders and industry professionals have said South Florida ticks many of the boxes. Miami appeals to a vibrant millennial community — that’s a big plus — and its tech community is developing. Boosters point out that South Florida is a college town with hundreds of thousands of college students between Florida International University, University of Miami, Miami Dade College, Broward College, Nova Southeastern and Florida Atlantic University, among others.
But the region, where Amazon CEO Jeff Bezos graduated high school as valedictorian, faces obstacles as well.
The lack of a sophisticated, well-functioning mass transit system may hurt South Florida, but many cities are overly dependent on the automobile, said Dan Foster, senior managing director of Newmark Knight Frank, a site selector that handles projects globally, including in the Miami market.
A bigger issue could be access to a deep enough tech talent pool, he and others interviewed said. While few communities could support 50,000 high wage jobs now, the area will need to show that it can develop a pipeline and that it is an environment where people want to live and work.
Miami-Dade’s tech industry is the smallest of the county’s seven targeted industries by number of jobs — although the tech industry is four times larger in Broward with big workforces for Magic Leap, Chewy, MDLive and other companies. South Florida and the state also often rank low in surveys of the technology landscape; Bloomberg’s 2016 U.S. State Innovation Index ranked Florida 34th, while the Milken Institute’s State Technology and Science Index puts Florida in 41st place. For tech salaries, Florida ranks 24th, according to CompTia’s annual study.
And as the recent storm season underscores, South Florida comes with disaster risk, Foster said.
Nationally, the handicapping among analysts is well underway. The most positive of them: Moody’s Analytics ranked Miami as No. 7, lauding its airport and seaport, its status as an international gateway city and its business-friendly climate, while giving it lower marks for mass transit. Moody’s also questioned Florida’s political will, ability to deliver large incentive deals and availability of the 8 million square feet of office space Amazon requires. It noted that Miami is as far away as you can get from Seattle.
“MOODY’S ANALYSIS RANKED AUSTIN (ALREADY HEADQUARTERS OF AMAZON’S WHOLE FOODS DIVISION), ATLANTA AND PHILADELPHIA AT THE TOP.”
Moody’s analysis ranked Austin (already headquarters of Amazon’s Whole foods division), Atlanta and Philadelphia at the top.
Dallas, Denver, Chicago, New York, Boston, Washington, DC, and Toronto have also been named as contenders in the media. A Brookings Institution analyst and a detailed Anderson Economics Group study didn’t even rank Miami in the top 20 possibilities.
But despite the terms of the RFP, nobody really knows what’s most important to Amazon.
“If Amazon is trying to replicate what it has in Seattle, I don’t think Miami’s chances are very good. I can’t imagine two communities that are more different. But if Amazon is looking for something completely opposite … Miami’s chances improve,” said Andrew Levine, president of Development Counsellors International, which advises communities on marketing their assets.
Some analysts say multiple cities will satisfy all or most of Amazon’s requirements — meaning government incentives and tax abatements could be critical. Historically, other states often have offered richer incentives than Florida, which recently has trimmed support for economic development programs such as Enterprise Florida.
That’s what worries Greiner.
“It’s an unavoidable conclusion that proposals like this become incentives arms races,” Greiner said. “The state is a major player in this. This is an earthshaking, game-changing, one-of-a-kind opportunity.”
Amazon is not only huge in retail, but also a big player in technology, distribution and media. “Because Amazon is so diverse, it connects to local industry strengths that could push these industries over the top,” Greiner said.
Then there’s the multiplier affect. A headquarters of this magnitude would help support hundreds if not thousands of small service companies, he said. Amazon has become a very significant player in spinning out tech startups — some 50 startups have been created. That would be a significant boost to the Miami area’s efforts to build a regional tech hub.
“I hope the state comes up with a really enticing package and gets past the politics in Tallahassee.” Greiner said.
Finney pointed out that incentives at the state and local level will be a bigger part of the conversation if and when negotiations move forward.
Whatever happens, the application has been a positive exercise to bring the region together to assess the strengths and weaknesses from a tri-county perspective, said Alfred Sanchez, president of the Greater Miami Chamber of Commerce.
“Whether we get it or not — and I really hope we get it — we are looking at ourselves in the mirror and seeing where the blemishes are and we’re really, really intent on fixing those blemishes,” said Sanchez. “Mike Finney is not afraid to say these are the areas we are lacking and we are going after it. … The chamber will work very closely with the Beacon Council to address our deficits and try to meet tomorrow head on.”
Nancy Dahlberg: @ndahlberg
Click here to view original article.