Miami’s a finalist for Amazon’s second headquarters. Does it have a chance of winning?

The Miami Herald

January 18, 2018

by Douglas Hanks


Amazon narrowed its list of potential cities for a second headquarters on Thursday, and Miami made the cut.

The online retail giant received 238 applications for what may be the most competitive corporate recruitment effort in history as the company promises to generate about $5 billion in the city it chooses to build a second headquarters employing about 50,000 people. The narrowed 20-city list announced by the Seattle-based company includes major metropolitan areas from across the country, starting with Atlanta and ending with Washington, D.C. In the alphabetical roster of “HQ2” finalists, Miami is listed between Los Angeles and Montgomery County, Maryland, a prosperous D.C. suburb.

Miami is the only Florida city to make the cut, and it bested other cities known as corporate hubs. Houston didn’t make the Amazon cut. Neither did Sacramento, California, or Baltimore, Maryland, or Charlotte, North Carolina. The New York Times writer who covers the Amazon beat called Miami’s selection “unexpected,” and one organizer involved in the Miami bid said: “I’m shocked we made it.”

Though dubbed a “Miami” bid, the application was submitted by economic-development arms of Broward, Miami-Dade and Palm Beach counties. The details largely remain a secret, with Miami-Dade declining to make the application public beyond an Oct. 12, 2017, letter from Mayor Carlos Gimenez describing the Miami area as the “Tech Center of the Americas.”

The bid offers five undisclosed sites from Miami-Dade, two from Broward and one from Palm Beach, said Michael Finney, director of the Beacon Council, Miami-Dade’s economic-development agency. Officials familiar with the application said there was more than one site in downtown Miami and one in Doral.

“Miami is a city of the future,” Gimenez said in a press conference. “God willing, Miami will be the second headquarters of Amazon here in the United States.”

Amazon founder Jeff Bezos spent part of his childhood in the Miami area, and was valedictorian of his graduating class at Palmetto High in 1982. Now he has the chance of becoming the top corporate player in Miami, where Amazon would become the largest employer in the region (ahead of the current leader: Miami-Dade’s school system, with about 33,000 employees).

Gimenez said he expects county officials to meet with Amazon executives during the next round of screenings. He pointed to the area’s concentrations of colleges and universities as an underrated plus for the region’s bid. “We’re one of the Top 10 college towns in the United States,” he said. “People who live here may not realize that, but we are.”

But Gimenez also said Miami’s “brain drain” problem is a top drawback — the tendency of talented young people and recent graduates to leave South Florida for regions with better-paying jobs.

“The biggest challenge, I think, is the talent. I think that would be the biggest challenge that we have to overcome here, versus some other cities that have a rich talent base. Boston, etc.,” he said. “We have advantages over some of those. Boston, taxes, the weather, etc. It’s going to be an interesting balancing act.”

Finney said the county has not offered Amazon any subsidies or tax breaks that aren’t available to other companies interested in moving to the area, but that advancing to the next round of applicants could mean a customized package for a retailer that generates more than $100 billion in sales each year.

“There’s an opportunity for us to go to city government, county government, and frankly even the state. And say: ‘OK, things have changed a little bit. We now are one of 20,’ ” Finney said. “This process is moving forward, and we want to make sure we incorporate the best possible options that are available from the state of Florida.”

While Amazon is being offered lavish subsidy packages and incentives by some jurisdictions, Miami is expected to come up short on that front given the backlash over so-called “corporate welfare” in Florida, according to a Moody’s analysis. That October report ranked Miami No. 7 in a Top 10 list of Amazon prospects, praising the region’s role as a hub of commerce for Latin America.

“Miami-Dade offers many advantages in its bid to be selected for Amazon’s second headquarters. Amazon is a logistics behemoth, and Miami is a leading distribution center,” Moody’s analyst Kwame Donaldson wrote.

The Amazon hunt also sparked debate over whether Miami’s traffic woes and underfunded transit system would cause the company to look elsewhere.

The Moody’s analysis predicted other contenders would have the edge. “And though Miami offers Florida’s most extensive public transportation system,” Donaldson wrote, “commuter and metro rail service lags behind the cities in the Northeast Corridor.”

But the sharpest criticism came from within, when Esteban “Steve” Bovo, chairman of the Miami-Dade commission, predicted traffic would sink Miami’s Amazon bid. “It ain’t gonna happen,” Bovo said in October. “We’re not equipped to draw 50,000 jobs here … because we don’t have the ability to let those people move around in our community.”

Gimenez alluded to Bovo’s comments during his press conference, saying: “We have a great airport, a great seaport. We have a great transportation system into the [urban] core,” Gimenez said. “Actually, our transportation system is a strength. Some people think that it is not.”

During a commission hearing about transportation funding about an hour later, Bovo, who is considering a run to succeed Gimenez as mayor in 2020, stuck by his criticism. “I am very happy about the news today we heard regarding Amazon,” Bovo said. “As I said before, I’m fearful that transportation is our Achilles. I don’t want that box not to be checked off when Amazon looks at us.”