CLEVELAND, Ohio — Cleveland isn’t a contender for Amazon’s second corporate headquarters, a much-coveted – and hyped – project that could bring as many as 50,000 jobs to a major metropolitan area over 10 to 15 years.
But the Buckeye State isn’t out of the running. Columbus made the list of 20 finalists that the e-commerce giant released Thursday morning. Amazon expects to settle on a site this year and open the first phase of the project in 2019.
Cleveland was one of 238 communities to submit proposals in October, in response to an unusually public solicitation from the Seattle-based company. Now Amazon has winnowed the list to locations in 16 states, one Canadian province and the District of Columbia.
“This is a highly competitive process and, although we are not one of the 20 finalists, this city and this region continue to be an attraction for global business,” Cleveland Mayor Frank Jackson said in an emailed statement. “I am confident in Cleveland’s advantages and know our economic, geographic and other assets make this a desirable place to live, work and do business.”
The finalists are: Atlanta; Austin; Boston; Chicago; Columbus; Dallas; Denver; Indianapolis; Los Angeles; Miami; Montgomery County, Maryland; Nashville; Newark, New Jersey; New York City; Northern Virginia; Philadelphia; Pittsburgh; Raleigh; Toronto, Ontario; and Washington, D.C.
“Getting from 238 to 20 was very tough – all the proposals showed tremendous enthusiasm and creativity,” Holly Sullivan, who handles public policy for Amazon, said in a news release. “Through this process we learned about many new communities across North America that we will consider as locations for future infrastructure investment and job creation.”
Amazon trimmed the field based on criteria including the quality of the workforce; availability of sites; and access to an international airport and public transit. The first phase of the project requires 500,000 to 1 million square feet of office space, at an estimated cost of $300 million to $600 million. The ultimate investment could total $5 billion and span 8 million square feet – more than five Key Towers worth of space. Average pay for the jobs, including software engineers, could be $100,000.
Cleveland, like many communities, hasn’t released the details of its pitch. Neither the city nor Cuyahoga County have provided any documents in response to public records requests submitted by The Plain Dealer last fall.
On Thursday, the city said the project team is consulting with lawyers to determine what – if anything – from that document will be released. A written statement from Team NEO, the nonprofit economic-development organization that submitted the bid on behalf of public and private partners, said that the proposal will remain “a protected business trade secret that will be deployed to benefit Cleveland in other nationally competitive economic-development discussions.”
More than 20 organizations and 90 people contributed to the proposal.
In addition to Team NEO, the city and the county, major players included JobsOhio, a private, nonprofit, statewide economic-development corporation; the state; the Downtown Cleveland Alliance; the Northeast Ohio Areawide Coordinating Agency, a planning group; and the Greater Cleveland Partnership, which is the metropolitan chamber of commerce.
Deb Janik, senior vice president for real estate and business development at GCP, expressed dismay that Cleveland didn’t make the cut. But the chamber and other local economic-development groups now are rallying behind Columbus.
“If it’s in Ohio, this kind of an impact is certainly going to be a benefit for the entire state,” she said. “We’ll do anything we can to help.”
It’s too early to know whether Team NEO and its partners will get feedback from Amazon on the merits and shortcomings of Cleveland’s offer. During site-selection contests, companies don’t always explain their decision to strike one location or another from a list. If Amazon does offer a critique, though, that information could shape the way the private sector and local governments pursue future deals.
Regardless, Janik said, the process yielded a few tangible benefits. Creative ideas dreamed up for Amazon could resurface in pitches to other companies. And the organizations and officials who assisted with the bid forged new ways of working together in the crucible of the six-week process.
“This is a strong foundation to build on when other opportunities come into play,” she said. “We know we’ve got the right partners around the table to move quickly.”
In a Twitter post Thursday morning, Cuyahoga County Executive Armond Budish said the local team made a strong proposal. “We are disappointed but, as always, proud of the great collaborative work our community did to put together the bid. We are ready for the next big opportunity.”
Amazon is making other forays into Northeast Ohio, where the Internet retailer has a distribution operation in Twinsburg and massive fulfillment centers, expected to employ 3,000 people between them, in the works in Euclid and North Randall. The company has leased additional space in the region for package pick-up and other operations.
Columbus, where Amazon made its first Ohio inroads with data centers and a pair of fulfillment centers, offered the headquarters project incentives ranging from property-tax abatement to income-tax refunds, according to letters obtained by The Columbus Dispatch.
The Dispatch reported in October that Amazon could receive 15 years of property-tax breaks on investments associated with the headquarters. Columbus also offered to plough much of the income-tax revenue generated by Amazon back into the project or into assets – such as transportation and infrastructure – that would address Amazon’s needs over the 15 years.
A letter from the city’s economic-development chief also mentioned reimbursement of Amazon’s real estate costs – for land acquisition, demolition and site preparation – up to $75 million. That money would not be available until the 16th year after Amazon’s arrival in the city, after the other, up-front incentives burn off.
Amazon could be eligible for other incentives in Columbus based on job creation, payroll, real estate investments and annual revenues. The Dispatch reported that the incentives would require approvals from Columbus City Council and the city’s school district.
The documents obtained by the Dispatch did not describe any incentives the state put on the table.
In an emailed statement, Republican Senator Rob Portman praised Amazon’s inclusion of Columbus on its shortlist. “Columbus is a growing, thriving city, and there is no doubt in my mind that it is the best choice among the announced finalists,” Portman wrote.
Portman, Democractic Senator Sherrod Brown and Ohio’s House representatives co-signed a letter in early October urging Amazon to consider making the state its second home. Now Columbus will have to vie against coastal competitors, bigger cities and tech meccas for what many communities view as a landmark prize.
Amazon expects to work with all 20 finalists to analyze the proposals more deeply and request more information before making a decision later this year.