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By Nick Wakeman

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Nick Wakeman

Amazon narrows HQ2 sites, GovCon getting nervous

The competition for Amazon’s second headquarters apparently has narrowed to a few sites including one in the Washington D.C. area.

Multiple outlets have reported that Amazon has Crystal City in Arlington, Virginia on its shortlist for the so-called "HQ2" along with Dallas and New York City.

The Washington Post reported over the weekend that Amazon is talking to real estate developer JBG Smith, which has pulled some properties off the leasing market. An announcement could come this month, after the mid-term election.

And according to a Yahoo Finance posting of a Wall Street Journal article, Amazon is negotiating with Virginia government officials about incentives.

The Wall Street Journal also is reporting that Amazon may pick two sites instead of one: Crystal City and Austin, Texas, according to a CNBC summary.

If Amazon does indeed pick a D.C. area location for its second headquarters, it would be a life-changing event for the local business community, including government contractors.

The company says its second North American headquarters would eventually house 50,000 employees.

Of course, the most obvious impact is on traffic. Crystal City is well located with Metro access and a station for the Virginia Rail Express commuter rail. But I’m sure there is a sense of dread for many that work in that area.

Another plus for Crystal City is nearby Reagan National Airport.

The area also has buildings owned by JBG Smith that could be ready for occupancy by the end of 2019. So Amazon could get a quick start on manning the second headquarters site.

Traffic will get worse, but a longer-term impact will be on the job market. And this has many government contractors worried. In fact, I'm told many are rooting for Amazon to pick another location.

Believe me I get it. Finding, recruiting and retaining workers is tough. The talent war is frequent topic of investor calls for publicly-traded government contractors.

The traditional role of human resource officer has been elevated at many companies with titles such as “chief people officer,” reflecting how seriously senior leadership takes the issue.

If you are a techie in the D.C. region, your choices are generally between working for a government contractor or working for the government itself. But the presence of Amazon will be a game changer.

Yes, many commercial technology companies like Amazon have a large presence in the D.C. region. But putting a headquarters here, well, that’s a whole new ball game.

Contractors will certainly adjust. Salaries and benefits may go up. They’ll also likely look to move more jobs outside the D.C. region and tap some new sources of talent. Many companies are already doing this.

But the addition to Amazon to the corporate landscape in the D.C. region will have a long and lasting impact. It could draw other high-tech businesses and more high-tech workers.

Yes, the competition will get tougher but I can’t help but think it will be mostly positive.

Posted by Nick Wakeman on Nov 05, 2018 at 12:09 PM

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