As ‘mother of bidding wars’ ramps up for Amazon HQ2, Canadian cities draft Combat  plans

Amazon.com Inc.’s call for pitches from cities hoping to become home to the online retailer’s new headquarters has touched off a frenzy in city halls across america andnbsp;Canada.

Cities are crafting demonstrations that boast of the features in hopes of being chosen as the location where Amazon will employ as many as 50,000 people and spend $5-billion (U.S.) as it grows its second company headnbsp;office.

“This is shaping up to be the mother of bidding wars,” said Scott Galloway, a professor at New York University’s business school and writer of The Four: The Hidden DNA of Amazon, Apple, Facebook and Google. “Every mayor needs to be the one which detonates a prosperity bomb from the townnbsp;square{}”

Bids are being constructed by Vancouver, Calgary, Edmonton, Toronto, Ottawa, Montreal, Halifax, as well as Sault Ste. Marie, Ont. Windsor, Ont., is teaming up with Detroit in what might be the sole cross-border pitch fielded by Jeff Bezos and his Amazon executives. The Canadian towns are up against dozens of U.S. areas and are gambling they could convince Amazon to risk a political firestorm in President Donald Trump’s United States by finding outside thenbsp;nation.

“All Canadian towns boast at least one significant research university and a solid high-tech surroundings and all can adapt the jobs growth expected from Amazon, especially because this expansion will be metered out with time,” stated a report from commercial property firm Colliers, bypassing overnbsp;Halifax.

With only less than half-a-million individuals in the regional municipality of Halifax, the port city understands it’ll seem a pint-sized competitor for the bidding. However, Halifax officials say the city is serious about putting together a bid which will contend. “We know we are a long-shot. No question,” Mayor Mike Savage said. “But we would be a no-shot when we did not put in a bid. We’ve got some very serious people round the table which have been meeting everynbsp;day.”

Ed Clark, a former bank executive who’s leading the drive for the three Ontario cities, ” said Canada’s cheaper money, lower salaries and low-cost health-care provide Amazon significantnbsp;economies.

Toronto not be resorting to antics like mailing a cactus into Mr. Bezos — as business leaders in Tucson, Ariz., attempted to — to be able to woo the company, said Mark Cohon, chairman of Toronto Global, the agency leading the Toronto area’snbsp;bidding.

“We will concentrate on the company and the strong narrative that Toronto has and we are not likely to get caught up in the gimmicks which we have seen from some smaller places around North America,” Mr. Cohonnbsp;stated.

Members of some bidding teams, such as in Toronto and Ottawa, recently toured Amazon’s Seattle campus, which includes 33 buildings and 8.1-million square feet with 40,000 workers, to determine where the $450-billion firm feels atnbsp;home.

Blair Patacairk, managing director of trade and investment for Invest Ottawa, said Canada’s capital would be a natural choice due to its likeness tonbsp;Seattle.

“Our secret sauce is we are Seattle No. 2, if you consider the quality of life and the culture,” Mr. Patacairk stated. “Yeah, we are not as huge as the GTA or Montreal. We are not that. But we are very similar in different ways to those men that are sitting there innbsp;Seattle.”

Looking to replace lost oil patch projects, Calgary and Edmonton are touting their lack of traffic congestion in cities which have space to grow. Vancouver, already home to an Amazon office, has a high quality of life on its own side. But it may too near Seattle for Amazon, which probably wishes to put its new HQ in another area and time zone. Montreal’s political turmoil and clogged roads aren’t in its favour, although the city has great universities.

Alan Middleton, a marketing professor at York University’s Schulich School of Business, said a fantastic pitch will highlight development distance and tax relief, along with emphasizing an area’s educated workforce and excellent ofnbsp;life.

He said the Greater Toronto Area has nearly everything Amazon would be searching for — except for a well-functioning transport network — but he doubts Mr. Bezos would risk being known as the guy who took 50,000 jobs to another country. “Even though he’s an antagonist of the President, I can not see him moving from america,” Prof. Middleton said.

Amazon announced the competition on Sept. 7 and set a submission deadline of Oct. 19. Bidders are to submit their proposals through the corporation’s website and the company says it’s going to name its chosen site some time in 2018. However, there are no other details on how the process will unfold. Amazon declined to comment for thisnbsp;narrative.

In its eight-page request for suggestions, Amazon lists why cities should be glad to host the business (jobs, money, jobs), and what it is searching for in a winning town. At the peak of the list is a place with a million individuals who could attract and retain tech workers and a “business-friendly surroundings and tax structure,” where community leaders “think creatively and big” about property. Nice-to-have features include a downtown campus with a design that looks like Amazon’s Seattle headquarters and isnbsp;development-ready.

Great schools and universities, a significant airport nearby and a great transit system are significant. So are “incentives,” that Amazon refers to at least 20 occasions in its petition fornbsp;proposals.

“Amazon welcomes the opportunity to interact with you in the introduction of an incentive package, real estate opportunities, and price structure to encourage the corporation’s location of the project on your state/province,” the document states. Such language is the substance of requests for proposals (RFPs) used by promoters of megaprojects, automobile plants and major sporting events. In the struggle to land jobs and investment, incentives are the weapons.

We know we are a long-shot. Nonbsp;question.

Halifax Mayor Mike Savage

“They will be looking for handouts,” Prof. Middleton said in a telephone interview.

Prof. Galloway explained Amazon’s record as “obnoxious, but no more obnoxious than what the Olympics sends out, or the World Cup.” He said authorities’ eagerness to court the organization is going to make them provide tax breaks and giveaways they will laternbsp;regret.

“My advice is: do the math and make sure that this is great for the city following the elected officials have [left office] and taken their victory laps,” he said in a telephone interview. “Enough giveaways and sufficient tax breaks will make this a poor thing. People are so drunk with the notion of being the next home to Amazon they could make irrational decisions. As they do to the Olympics every fournbsp;years.”

Of the Canadians cities vying for Amazon’s affections, Toronto is the only serious competition, he said. “Having said this, I do not think Canada has anynbsp;opportunity.”

That’s because Amazon and other enormous tech companies are facing criticism from america for preventing taxes and killing jobs. Establishing a new headquarters in a different country won’t help Amazon’s bid to be viewed as a fantastic corporatenbsp;citizen.

Prof. Galloway figures Amazon has chosen New York City. “They are simply running a competitive bidding process in order that they can take the best terms to the mayor of New York and ask him to match it,” henbsp;stated.

Prof. Middleton, however, said he’s been advised Cleveland is the probable winner. “They are pitching like mad and offering a great deal of cash and have a reviving tech industry,” henbsp;stated.

Eric Atkins, with documents from Jessica Leeder, Andrew Willis, Alexandra Posadzki and Shanenbsp;Dingman

Calgary

Calgary is the fourth-largest town in Canada, with 1.5 million people, but the civic boosters supporting its proposal are convinced that it might be the No. 1contender one of Amazon’s northernnbsp;alternatives.

“Amazon has been a goal of ours for a few years, we have been having several conversations with them,” states Mary Moran, president and chief executive of the Calgary Economic Development, the company shepherding the town’snbsp;bidding.

Calgary’s best pitch to Amazon could be that its energy-focused market fell off a cliff three decades ago after a decade of torrid growth. The end result of the downturn is twofold: accessible property and a skilled labour market with somenbsp;slack.

“It is really obvious that they’re not looking for a big city, they are trying to find a less-congested, easy-to-get-around, lower-cost-of-doing-business town, otherwise why bother moving?” Ms. Morannbsp;states.

According to a recent report from Barclay Street Real Estate, the city has about a 25-per-cent vacancy rate for offices, representing roughly six-million square feet ofnbsp;distance.

The town also has about 6-per-cent unemployment and lots of “headquarter” ability (legal, human resources, logistics, etc). 1 drawback about the talent pool is that, while Statistics Canada data from 2016 indicate the city has about 32,200 engineers, just about 2,900 are softwarenbsp;engineers.

Calgary may also have the most enthusiastic regional population, if the active and voluble #amazonyyc hashtag on Twitter is anynbsp;sign.

Shane Dingman

Edmonton

Edmonton Mayor Don Iveson had the very colourful reaction to the Amazon RFP we have come across, calling the opportunity to land $5-billion (U.S.) in economic growth a “tastynbsp;morsel.”

Adam Sweet, chief of staff in the Edmonton Economic Development Corporation — which will be running Edmonton’s proposal — is maintaining closemouthed on the event the town will be making to Amazon, declining even to mention what he believes are its cultural differentiators. “We are making an economic situation,” is as specific as he’ll get, but he says that the town is determined to win. “When Edmontonians put their mind to something, we state what we do and we do what wenbsp;state.”

Publicly available data indicate why Edmonton might be a fantastic fit. Amazon is seeking a place with higher growth, and Edmonton’s population boom has made it the second-fastest growing city in Canada and the youngest of the large cities, with a median age ofnbsp;35.7.

Space should also be no problem: A Colliers International report on Edmonton’s office marketplace noted that the city has had 10 consecutive quarters of “negative absorption,” or increasingnbsp;vacancy.

What Mr. Sweet will say is the City of Champions enticed an outpost of Google’s artificial-intelligence firm, DeepMind Technologies, into city and it’s a world-renowned machine-learning research center at the University ofnbsp;Alberta.

Edmonton might be the coldest city in the contest. According to Statistics Canada, its coldest month comprises average lows of -19nbsp;C.

Shane Dingman

Halifax

Halifax officials know they’re dreaming big with their eyesight to attract Amazon to the East Coast. Atlantic Canada’s largest city remains modest at fewer than half-a-million men and women. But bid enthusiasts insist that the city can punch above its weight given thenbsp;chance.

While Amazon will doubtless bring a new flow of job-seekers, Halifax has been stoking its electronic market. Tech-industry jobs ballooned more than 50 percent from 2010-15; the town was recently named Canada’s fifth-largest tech hub. Halifax ranks among the lowest-cost cities in Canada for technology firms based on average wage and lease obligations, based on a by CBREnbsp;Ltd..

There are more than half-a-dozen postsecondary schools in the Halifax area, which adds up to both work-force potential for Amazon and paths for unique collaborations. “We’re disproportionately strong concerning our educational facilities and the capability to support this form of enormous, white-collar initiative,” stated Ron Hanlon, president of the Halifax Partnership, an economic-developmentnbsp;bureau.

Transit, however, will be challenging. Buses are the backbone of a bare-bones subway transit service, even though the city hinted that enlarged commuter-ferry service will factor into its own bid. It’s also in discussions with airlines about bumping up direct flights to major destinations in the USA, said Ron Hanlon, president of the Halifax Partnership, an economic developmentnbsp;bureau.

Officials are mum on where they will suggest to construct Amazon’s gargantuan campus. But anticipate what locals call the “sea advantage” to play anbsp;part.

Ocean access generates options for eco friendly building designs in addition to quality-of-life incentives for employees. “We like to discuss our boardroom-to-kayak-to-beach opportunity,” Mr. Hanlon said. Those are beaches which, as a result of Halifax’s buyer-friendly housing market — the average home price is about $300,000 — Amazon workers will have the ability to livenbsp;on.

Jessica Leeder

Montreal

Montreal officials say they are putting together a excellent bid. They are just too busy to discuss it, says a spokesperson for Montreal International, the agency responsible for the town’s proposal, and they do not need to disclose the confidentialnbsp;plan.

However, Quebec, “has what required to attract such a significant investment: a secure business environment, a strong academic community that fosters co-operation and highly skilled, creative ability whose genius is the envy of all,” Quebec Economy, Science and Innovation Minister Dominique Anglade stated in a news release earlier this month which highlighted the city’s standing as a technology hub and its willingness to foreignnbsp;investment.

With its charming cobblestone streets, historical buildings and vibrant arts scene, Montreal could be the most scenic of the Canadian cities bidding for the Amazon headquarters. And it is certainly hip. The town has a thriving craft-brewery scene and its denizens have street-style befitting the pages of a fashionnbsp;magazine.

Montreal also checks a range of Amazon’s boxes. The population because of its own census metropolitan area exceeds four million, well over the one-million threshold stipulated in the RFP. The state’s economy is turning a corner after decades of slow growth, yet home prices remain considerably lower than in Toronto and Vancouver, making home ownership a realistic aspiration for itsnbsp;residents.

But Montreal has a variety of drawbacks as well, including crumbling infrastructure and Quebec’s history of political chaos and corruption. Those could prove to be significant setbacks to the city’s efforts to attract the technbsp;giant.

Alexandra Posadzki

Ottawa

With a population of about 1.3 million, the Ottawa-Gatineau area barely exceeds the minimal dimensions stipulated in Amazon’s RFP. And its airport does not provide direct flights to Seattle — a significant drawback. However, Blair Patacairk, managing director of trade and investment at Invest Ottawa, says Canada’s funding has lots going for it, including a highly educated workforce, a burgeoning tech industry and a high overall quality of life.

While Ottawa is famous for its high concentration of civil servants, its technology sector is growing quickly and is the area’s second-largest employer, following the federal government, Mr. Patacairk states. Sixty-one percent of Ottawa’s workforce have postsecondary degrees, which makes it the nation’s most educated workforce, henbsp;adds.

Housing is less expensive than it’s in Toronto, Vancouver or several of the U.S. cities vying for the Amazon campus and the area’s smaller relative size means less time spent innbsp;gridlock.

Even though it does not have the “cool cred” afforded to its bigger Ontario counterpart, Mr. Patacairk notes that Ottawa does provide various entertainment options, from concerts to sporting events. Its proximity to hiking trails and ski slopes will interest the outdoorsy and, in winter, its residents can skate across the Rideau Canal, the world’s biggest skatingnbsp;rink.

“We have the benefit of being directly with our friends in Quebec, lots of whom are French-speaking,” Mr. Patacairk notes. “People come here and adopt that. They go on each side of the river. So the National Capital Region has a lot to offer in thatnbsp;respect.”

Alexandra Posadzki

Greater Toronto Area

The Greater Toronto Area’s bid assesses lots of the boxes on Amazon’s wish list. Its inhabitants — 5.9 million to the census metropolitan area, according to the latest census data — well exceeds the minimum of one million. Pearson International Airport is easily accessed through the UP Express and the area has a concentration of high quality universities churning out graduates, such as innbsp;technician.

But another, more abstract element of the Toronto area also bears mentioning — its multiculturalism and developing worldwide prominence as an epicentre of cool. Toronto finished fourth at the Economist’s 2017 evaluation of the world’s most livable cities. Its West Queen West neighbourhood was named the second-coolest neighbourhood in the world by Vogue magazine, which dubbed its primary thoroughfare that a “veritable artery” of art galleries, indie patisseries and other “hallmarks ofnbsp;hipness.”

“Toronto is generally viewed right now as a cosmopolitan, trendy place that’s extremely dedicated to innovation and creativity,” Toronto Mayor John Torynbsp;states.

But traffic congestion and sky-high home costs could detract from the regional bid, including Mississauga, Brampton and the Halton, York and Durham regions, and has been directed by Toronto Global, a new agency created to attract foreign investment into thenbsp;area.

Toronto is Canada’s second-least affordable housing market after Vancouver, according to a June, 2017, report by RBC, with the average household spending 45.9 percent of its earnings to pay ownership costs for a normal home bought in the first quarter of thisnbspannually.

The town is also next to Vancouver concerning congestion, based on a 2016 report by the Toronto Foundation. Torontonians love to whine about the Toronto Transit Commission — you need not look farther than the favorite Twitter hashtag “#TTCfail” for evidence. Regardless of this, the American Public Transportation Association bestowed its “outstanding public transit system of the year” award on the TTC this year and Mr. Tory notes that lots of transit improvements are on the way and could be completed by the time the Amazon headquarters will benbsp;constructed.

Home prices and traffic congestion are simply the byproduct of Toronto being a desirable place to live, Mr. Tory says. “We’re attracting plenty of talent from around the Earth, which explains why the population is growing. That leads to increased demand for transit, but it is the exact same reason why we’re in a position to rank quite high on the gift list,” he says. “You can not have it bothnbsp;manners.”

Alexandra Posadzki

Vancouver

Vancouver isn’t just geographically the closest major city to Seattle, but also the house of Amazon’s largest satellite office in Canada. Therefore, the people running its bid appear comfortable with their own chances. Maybe toonbsp;comfy.

“They already know a great deal about Vancouver — enough, we believe, to want to find here; it’s now a matter of showing them how they could do so,” stated James Raymond, a research manager in the Vancouver Economic Commission (VEC) who is also the Project Execution Lead to your HQ2nbsp;bidding.

The city does have a tendency to speak for itself. In August, The Economist rated it the third-most livable city in the world. Having said that, a Collier’s report on office space for its next quarter of 2017 discovered its regional vacancy rate was 6.3 percent, with a per-square-foot price tied with Toronto for the priciest in thenbsp;country.

It has among the greatest tech-talent pools in the nation, with approximately 75,000 tech employees in the Metronbsp;region.

For all that, despite Mayor Gregor Robertson’s outspoken support, the Vancouver bid was comparatively silent, leaving other cities to wrestle for the spotlight. “With more time and resources, we might have opted to run an official public and stakeholder engagement campaign,” Mr. Raymond wrote in an email, though he said a recent survey put public support for the bidding at about 88 pernbsp;cent.

Also on VEC’s plate at the moment are events and a future study on the city’s film and TV industry. According to Ingrid Valou, spokesperson for the VEC, “there are a whole lot of people really pushing themselves to make certain that none of our other work suffers as a result” of the Amazon bidnbsp;procedure.

Shane Dingman

Windsor/Detroit

If former Windsor mayor Eddie Francis were pitching Amazon chief executive Jeff Bezos on finding a $5-billion (U.S.) complex in the southern Ontario town and neighbouring Detroit, he would begin with a challenge.

“My question to Amazon is, ‘What will be your legacy from this choice; do you want your legacy to be a catalyst for renewal?'” Said Mr. Francis, who left politics three decades back and is currently CEO of WFCU Credit Union innbsp;Windsor.

In what’s regarded as a long-shot bid, billionaire Dan Gilbert is leading the sole cross-border pitch for Amazon’s second headquarters in two towns with a combined population of approximately 900,000 and rusty, industrial roots. Windsor Mayor Drew Dilkens and town officials of all stripes declined to comment on thenbsp;suggestion.

Windsor has teamed up with its U.S. neighbour to acquire high-profile events before, including hosting an NFL Super Bowl in 2006. But a comparatively shallow talent pool and infrastructure problems, such as limited mass transit, imply both cities are underdogs from the Amazon sweepstakes, based on international-business specialist Andreas Schotter, who previously made decisions on mill places while working at Volkswagennbsp;AG.

“Amazon should find in a globally connected neighborhood, one with high livability and a varied urban experience,” stated Mr. Schotter, a professor at the Ivey Business School at the University of Western Ontario. “Detroit isn’t a global city, it’s a regional center focused on autos … and Windsor and Detroit will find it hard to sellnbsp;livability.”

Andrew Willis

Courtesy: The Globe And Mail

Related posts

Leave a Comment