how many millions are you saving for Amazon HQ

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how many millions are you saving for Amazon HQ

David Zheng

Investor · Saint Louis, MO · Member since 2016 · 970 posts · 1k+ votes

with the final 20 cities released for amazon's new HQ

how many investors do you think are hoarding cash to buy up as much as possible when we know?

also....if anyone is an insider. HIT ME UP lol

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Russell BrazilBusiness Member

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Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes

Im saving Zero. For most of the cities named, Amazon is not going to move the needle. They expect 50,000 jobs. Lets say 50% of that is hired from existing population and 50% from migration. Spread that out over 5 years, and a population increase of about 5,000 extra people per year simply does not mean much for many major cities. And all these cities that have potential locations for Amazon, it isnt like that land will sit vacant if Amazon does not move there. It will be developed into something else, just not with as big of a buzz word attached.

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Josh Collins
Investor · Woodbury, MN · Member since 2016 · 90 posts · 72 votes
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I'm going with the second tier markets as the front runners. My picks are 1.) Raleigh, NC, 2.) Nashville, TN, and 3.) Pittsburgh, PA.
I think Texas is a tough sell with Bezos' political orientation otherwise they might be my favorite (taxes, business friendly, zoning, mid-American). I think Amazon would add extra weight to housing affordability therefore I like the mid-continent cities but there are very few that seem plausible and/or well connected enough to make it seem reasonable. I have a hard time seeing Chicago-land getting picked. I just think they're too unfriendly to business. Tennessee and Pennsylvania also have very low tax rates which is favorable for new business and employees. But I like Raleigh's location and to be honest, my eyes trained on that area before I even knew they were in the running. Central to everywhere on the Atlantic Coast and most of mid-America too.
By the way, it's really fun to hear ideas on all the cities. Some people here make very good arguments for cities I would have just written off as a no.
It should be fun to watch!
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Matt R.
Sherman Oaks, CA · Member since 2013 · 3k+ posts · 2k+ votes
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Originally posted by @Brian Reynolds:
@Logan Allec "small suburb" of Santa Clarita. According to it's own website it has 213,000 residents. That's not small. I love Santa Clarita and have a rental in Sand Canyon, but I don't see Amazon setting up shop there, the 5 is already terribly congested nearly 24 hours a day going in and out of Valencia... one of the factors is "ease of commuting". I don't even know why Los Angeles is still on the list.
LA had six possible sites, I know two were downtown and one was the old Rocketdyne plant in Canoga Park with 45 acres. I am not aware of the Santa Clarita option as that is not in LA city of borders...county yes but don't know if those non city areas were part of the LA city proposals or not. My guess is not.
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Brian Reynolds
Rental Property Investor · Porter Ranch, CA · Member since 2016 · 31 posts · 40 votes
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@Josh Collins I lived and worked in Raleigh-Durham area for 7 years. Awesome place (if a shade boring for a young professional), affordable housing, listed in top 10 places to live in USA often, has tech scene (research triangle park) with talent pool, 3 universities pumping out graduates, healthy arts and entertainment scene, ease of commuting, not crowded, space to spread out.
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Josh Collins
Investor · Woodbury, MN · Member since 2016 · 90 posts · 72 votes
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@Brian Reynolds
Great to have your first-hand information. Sounds like the kind of place I would look for if I owned Amazon. Not sure what all the incentives are yet so that could be a game changer of course.
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Account Closed
Investor · Princeton, TX · Member since 2014 · 1k+ posts · 1k+ votes
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Jeff Bezos is very liberal on social issues. If anyone had any doubts the $33,000,000 he recently gave for scholarships for DADA recipients should have made that clear.
Texas is absolutely the front runner without the "culture" issue. Of course Mr. Bezos knows Texas extremely well and he knows what the demographics will be here in 10 years.
His family does own more than 25,000 acres in a part of Texas that is more than 80% hispanic.
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Peter S.
Attorney · Miami, FL · Member since 2017 · 108 posts · 113 votes
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Don't overlook Miami-Ft.Lauderdale-Palm Beach which did a combined bid. Three major airports, two large seaports and the gateway to Latin America. Tons of housing, no state income tax and three research universities within 50 miles. Bezos graduated high school in Miami, so he knows the area well. And as far as attracting top talent, show me a recent grad who won't take 70 degree winters and a low cost of living.
The politicians here in Miami are all psyched about getting them and if there are any politicians that can get a deal done, its the slimy politicians in Miami. Ha
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Scott TitusPro Member
Rental Property Investor · Lake Ozark, MO · Member since 2017 · 102 posts · 86 votes
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@Timothy Doenges I agree that it could help chicago, but there are far more issues at play that an amazon facility will not help. I see everyone here looking at what it would help, but take a step back and look at the macro issues of some of these large cities. Taxes are outrageous. Seriously outrageous. They’re actually crippling. Chicago has the fastest exodus of millionaires of all cities in the U.S. due to these constantly raising taxes. Think about that for a minute.
California as a whole has horrible political problems and skyrocketing taxes...again, another state most investors don’t want to buy in due to the constantly rising property taxes. I could go on and on about many of these areas, but the point is that just because it would be good for the city doesn’t mean it would be good for investors.
Just my .02.
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Nathan A.
Investor · Morgan Hill, CA · Member since 2017 · 18 posts · 6 votes
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@Russell Brazil I think that the new HQ will create way more than the 50,000 jobs. According to a report by the Bay Area Council Economic Institute, for each job created in the high-tech sector, approximately 4.3 jobs are created (multiplier effect) in other local good and services sectors across all income groups, including lawyers, dentists, schoolteachers, cooks, and retail clerks, among many others.
I also agree with @Account Closed, 50,000 jobs x $100,000 will have a significant impact on any local economy.
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Deanna O.
Rental Property Investor · San Diego, CA · Member since 2010 · 366 posts · 314 votes
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Matt R - I live in San Diego - zero surprise we weren't in the top 20. Great place to live, but no good building site that is anywhere near a good commute, extremely high cost of housing ($500k average for a basic 50 year old tract home), no decent public transit, over-all poor education levels in the public schools. Throw in a city government that can't solve even basic problems intelligently & meh, why bother.
Scott R. - quick correction -- property taxes in CA aren't "rising". They are still 1% of purchase price and have been since the 70s. What HAS changed is property values, thus if you buy a $700k house you will pay @ $7k per year, while your neighbor who purchased his (identical) home in 2008 might only be paying $3k. New buyers frequently complain about how this is "unfair"...until the value of their property goes up (at which point you don't hear a peep LOL).
The good news is that no matter how much the market value of your property goes up the tax only increases a max of 2% per year,meaning that Year 2 your tax won't exceed 1.02% of purchase price, third year 1.04%, year 4 is 1.06% etc.
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Chris Virgil-Stone
Rental Property Investor · Cape Coral, FL · Member since 2015 · 206 posts · 83 votes
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Not to be biased but my bet is in or around Atlanta. They recently bought Whole Foods, also based in Atlanta. Atlanta is also the tech hub of the south.
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Matt R.
Sherman Oaks, CA · Member since 2013 · 3k+ posts · 2k+ votes
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Originally posted by @Deanna O.:

Matt R - I live in San Diego - zero surprise we weren't in the top 20. Great place to live, but no good building site that is anywhere near a good commute, extremely high cost of housing ($500k average for a basic 50 year old tract home), no decent public transit, over-all poor education levels in the public schools. Throw in a city government that can't solve even basic problems intelligently & meh, why bother.
Scott R. - quick correction -- property taxes in CA aren't "rising". They are still 1% of purchase price and have been since the 70s. What HAS changed is property values, thus if you buy a $700k house you will pay @ $7k per year, while your neighbor who purchased his (identical) home in 2008 might only be paying $3k. New buyers frequently complain about how this is "unfair"...until the value of their property goes up (at which point you don't hear a peep LOL).
The good news is that no matter how much the market value of your property goes up the tax only increases a max of 2% per year,meaning that Year 2 your tax won't exceed 1.02% of purchase price, third year 1.04%, year 4 is 1.06% etc.
I guess there are no surfers at Amazon. I was thinking the Qualcom site. I get your point however LA made the cut and housing going to cost even more I assume.
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Deanna O.
Rental Property Investor · San Diego, CA · Member since 2010 · 366 posts · 314 votes
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Stadium site would be touchy politically, though it is about the ONLY avail site that
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Deanna O.
Rental Property Investor · San Diego, CA · Member since 2010 · 366 posts · 314 votes
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....25 miles out in the middle of nowhere. It is the only open site in San Diego with public transit (trolley), but NO reasonable housing nearby. Gang & drug-infested areas run $1,500/2 bed apartment. $3k for similar in Mission Valley. Compare that to new entertainment-ready McMansions in Texas with 4 car garages, & I could fly to somewhere with good surf.
I did have to laugh about and earlier posters comment about $100k as being "high wage jobs". In San Diego $36k year rent, $25k in Fed income taxes, another $5k in state income tax...throw in food & clothing, health insurance & a car (can't get around without a car here) & raising a family would be a very modest, frugal affair on $100k. Doable, but not exactly the lifestyle you think of when you say "high income". The same salary in any of the other of the other contending regions would go a whole lot further (even just outside DC).
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Deanna O.
Rental Property Investor · San Diego, CA · Member since 2010 · 366 posts · 314 votes
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"that isn't 25 miles out in the middle of nowhere"
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Matt R.
Sherman Oaks, CA · Member since 2013 · 3k+ posts · 2k+ votes
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Originally posted by @Deanna O.:

"that isn't 25 miles out in the middle of nowhere"
Those apts condos near qualcom 3k mo, I was thinking 2300ish. These new tech types don't seem too keen to live in 100% suburbia. Many will be cool with 1-2 bd condos or they will have to be if it is LA.
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Nate R.
Real Estate Investor · Austin, TX · Member since 2015 · 214 posts · 234 votes
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I agree it will impact any of these cities, but especially cities with already-tight housing markets and infrastructure that can't handle the influx of 50,000 new residents. Due to the tight labor market, I am assuming that wages would go up to attract new residents to fill those jobs, or that Amazon would transfer employees from other locations. The net result, though, is population increase and more money in the local economy.
I live and work in North Austin, where there is already a big tech presence. Amazon has a big engineering office at the Domain mall, and there are other big tech companies near as well (Apple, Dell, etc).
Traffic -- an intractable problem in this metro for reasons I won't get into -- seems to get worse daily, and neighborhoods that were once considered suburbs are now part of the new geographic center of the Austin metro area. It's hard to imagine plopping down 50,000+ people down here and not having any impact.
So, maybe there are places with better infrastructure or more cheap land that will be in the running. Austin could be a contender but I just have a hard time imagining how we could handle Amazon HQ.
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Account Closed
Investor · Princeton, TX · Member since 2014 · 1k+ posts · 1k+ votes
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I was less than clear in one of my earlier posts. The $5,000,000,000 a year will be in direct salaries from Amazon. The total financial impact would be much larger. It is not known exactly. In fact, nobody even knows what this new site will actually do. For example, is it going to completely run the pharmacy portion of the business? If so... the mix of people needed would be different than if it is going to run the cloud computing portion.
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Josh Collins
Investor · Woodbury, MN · Member since 2016 · 90 posts · 72 votes
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Well, it looks like the Las Angeles area people were correct. I have to say I'm surprised but the LA incentives were large and in charge. I can't begin to describe how wrong I feel right now! Lol.
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