Philly Officials Have Few Regrets Over Losing Out On Amazon HQ2

The rumors hadn’t been friendly to Philadelphia for months, but on Tuesday it was confirmed: Amazon has gone in a different direction for HQ2 — or rather, multiple different directions.

Hours after the e-commerce behemoth announced its intention to split the 50,000 jobs and $5B in investment of Amazon HQ2 between Northern Virginia and Queens in New York City, Mayor Jim Kenney led a press conference of Philly leaders reacting in measured disappointment to the news.

“I was more disappointed by the Dallas game on Sunday,” Kenney said, referring to the Philadelphia Eagles' loss to the Dallas Cowboys Nov. 11.

Kenney, PIDC President John Grady, Chamber of Commerce for Greater Philadelphia President Rob Wonderling and City of Philadelphia Director of Commerce Harold Epps all spoke at the conference, striking a similar tone: saddened by losing out on HQ2, but proud of the city's political and business leaders for their collaboration and effort.

When asked what the city could have done differently, Epps and Grady both claimed they only would have become more focused on business recruitment before Amazon's request for proposals, but otherwise would not have made any changes to the city's pitch. That being said, Epps and Grady expressed hope that Amazon will reach out in the coming weeks to "debrief" and give the city pointers on where it fell short.

That pitch was released online by the city at 3 p.m. Tuesday, full of details and data about the three locations offered as HQ2 sites — Schuylkill Yards and uCity Square in University City and the Navy Yard in South Philly. The section containing the financial incentive package was heavily redacted, but did include the offer of a $1.1B Tax Increment Financing District wherever Amazon would have landed.

Between the original pitch and materials presented after Philadelphia was named to the 20-city shortlist, Grady estimated that the city spent about $400K on recruiting Amazon. He and Epps justified the cost by saying much of that expenditure has been and will be reused for other business recruitment.

“The philosophy around the incentives from the beginning was to be aggressive, but never irresponsible,” Epps said.

Epps, Grady and Kenney all maintained that the incentive package offered was similar in nature to what the city has offered to other businesses in recent years, scaled up for the size of the proposed development.

Grady was the main point of contact between the city and Amazon throughout the process, and he said that the last he heard from the company was in an email Tuesday morning informing him that Philly had not been selected. Before then, he said he had been in "somewhat regular" contact with Amazon.

Among the contacts were a two-day visit to Philly from Amazon executives in February and a follow-up visit in April, Grady said. He said it is possible Amazon took even more visits without the knowledge of city officials.

Beyond the blueprint that Philly's Amazon pitch has set for future business recruitment, Epps said that the city will also benefit from the process due to its position between the two sites that wound up being selected. Philly's historic growth in the past 10 years has been partly due to its value relative to New York and Washington, D.C, and that value gap could grow if property values rise with Amazon's presence.

“If not in this city, then the best locations Amazon could have picked for us were chosen,” Epps said. “I think, as this thing unfolds, Philadelphia will be a quiet beneficiary of decisions some individuals and companies will make based on the realities in D.C. and New York.”