These Cities Don’t Regret Their Amazon Bid

Image credit: Flickr Contributor Maciek Lulko

The bidding war for Amazon’s second North American headquarters has been shrouded in commotion and controversy. Since announcing their RFP in September 2017, Amazon has come under fire by many academics and policymakers, who argue that the company’s willingness to accept major giveaways will divert much-needed funds for schools, housing, transportation, and other public goods. In particular, economists have expressed concern over the bidding process, which pits cities against one another in a likely effort to drive up the price of incentives.

In the wake of Amazon’s initial announcement, cities like San Antonio and Little Rock, Arkansas rescinded their bids due to concerns about protecting their resources. “We have a competitive toolkit of incentives, but blindly giving away the farm isn’t our style,” wrote San Antonio Mayor Ron Nirenberg and Bexar County Judge Nelson Wolff in a joint letter to Amazon CEO Jeff Bezos.

And yet, many other cities stand by their decision to enter the competition — regardless of whether they were ultimately chosen as a finalist. At the recent City Nation Place Americas conference in New York City (an event co-sponsored by the NYUSPS Schack Institute of Real Estate), development officials from Miami, Kansas City, and Philadelphia touted the effect of the Amazon process on their overall brand strategy.

“The Amazon proposal [encouraged Miami] to collaborate in a way that we hadn’t seen before,” said Michael Finney, the President and CEO of the Miami-Dade Beacon Council. In particular, Miami has learned the importance of communicating with nearby cities like Fort Lauderdale, along with the state of Florida as a whole. By convening both state and local governments, Miami has developed a cohesive narrative for attracting new talent and investment.

“The real value to our region was the cohesive story we built and the collaborative spirit in which it came together.”

As President and CEO of the leading organization behind the Kansas City proposal, the Kansas City Area Development Council, Tim Cowden had a similar experience. While putting together a bid, Cowden said, the city began with a group of five to seven individuals doing what they do every day: shining a spotlight on Kansas City’s unique assets. By the end of the process, their team had grown to more than 300 people working across two states, 18 counties, and 50-plus communities.

Like Finney, Cowden also saw the Amazon application as a victory in itself. Although Kansas City was not selected as one of the twenty Amazon finalists, the city now benefits from improved regional partnerships.“We won’t let our disappointment overshadow the incredible regional effort that went into our bid,” he told the Kansas City Business Journal in January. “As we said from the day we submitted our proposal, the real value to our region was the cohesive story we built and the collaborative spirit in which it came together.”

There’s also much to be gained from an application process that requires a clear economic development and tourism strategy. According to Anne Bovaird Nevins, the Chief Strategy Officer at the Philadelphia Industrial Development Corporation, the Amazon process was instrumental in helping Philadelphia understand its regional strengths and weaknesses. “We have a story to tell and we have to figure out how we tell that story together,” added Sylvie Gallier Howard, the Chief of Staff at the Philadelphia Department of Commerce.

By focusing on its larger role in the Boston-Washington corridor, Philadelphia was able to underscore its mobility and connectivity. In the absence of any one standout industry, the city highlighted its global airport, proximity to New York and Washington, D.C., and one million housing units located within half a mile of a transit station. In addition to crafting this narrative, Bovaird Nevins said, Philadelphia learned the value of supporting its information with concrete statistics.

Image credit: City of Philadelphia

Just weeks before Amazon announced its list of finalists, Philadelphia was chosen, along with three other city-regions, as the site of the Brookings Institution’s global identity project. Following a competitive application process, the institution selected Philadelphia, Atlanta, Louisville, and Columbus, Ohio as testing grounds for developing an internationally recognized city brand. In Philadelphia, the project will build on the promotional materials developed as part of their Amazon bid.

Still, the initiative is about more than catering to a single tech company or anchor institution. “This isn’t a logo, slogan, or sales campaign,” Marek Gootman, the Director of Strategic Partnerships and Global Initiatives at Brookings, said in January. “Greater Philadelphia will coalesce diverse stakeholders to project an integrated image telling the story of its purpose, value, and opportunity.” Thanks to the Amazon proposal, the region will have plenty of material from which to draw. “Fifteen years ago, we were a city in decline,” said Gallier Howard. “Now, we have momentum.”

STEVEN PEDIGO is the Director of the NYUSPS Schack Institute of Real Estate Urban Lab and a Clinical Assistant Professor for Economic Development at the NYU School of Professional Studies. He is also the Director of the Research and Advising for the Creative Class Group, an Associate Partner at Resonance Consultancy (Vancouver/ NYC), and a Senior Advisor for Leland Consulting(Portland). Follow him on twitter @iamstevenpedigo.

ARIA BENDIX is a writer for the NYUSPS Schack Institute of Real Estate Urban Lab. Her work has appeared in The Atlantic, CityLab, Bustle, and The Harvard Crimson, among other publications. Follow her on twitter @ariabendix.