On the heels of Amazon’s big announcement that it is planning its first headquarters beyond its Seattle home base, Chicago has reportedly thrown its hat in the ring with the hopes of landing the so-called ‘HQ2’ corporate campus. Chicago Mayor Rahm Emanuel has spoken directly with Amazon CEO Jeff Bezos regarding the matter, a source close to City Hall tells John Pletz of Crain’s. While Emanuel has taken an active role in securing downtown corporate relocations, the HQ2 deal would be by far the mayor’s single largest get to date with 50,000 employees and billions of dollars at stake.
Though Amazon has recently invested in eight Illinois warehouses, a new sorting center, and is expanding its existing Chicago downtown offices, the Windy City will face stiff competition for other US metros—like Atlanta—for what Pletz describes as potentially “one of the biggest corporate tech prizes in memory.” For instance, Illinois currently lacks the tech-friendly targeted tax credits as found in 12 other US states and Washington D.C. In fact, Chicago was entirely left off a recent list of eleven cities deemed likely to land Amazon’s HQ2 by MarketWatch.
Despite the aforementioned setbacks, Chicago still offers some advantages over competing US cities. Chicago is centrally located and has long served as a major hub for both rail and air travel. There’s a reason that catalog powerhouses Sears and Montgomery Ward were based in the Second City. While e-commerce is undoubtedly a different kind of animal, it can be argued that Amazon is the 21st century equivalent of those pioneering mercantile titans.
Chicago also has favorable infrastructure in place with one of the nation’s top transit systems when it comes to drawing talent from outlying neighborhoods and the suburbs to its downtown. This asset has already paid dividends on a smaller scale with the West Loop, Goose Island, and Merchandise Mart experiencing strong growth in the technology sector.
Perhaps the Windy City’s biggest competitive edge is found in its large and well-positioned developable sites. For example, Chicago’s renovation of the Old Post Office building and its 2.5 million square feet of large, tech-friendly office space is expected to be move-in ready in early 2019. The site could also support the construction of additional high-rise towers, as originally envisioned (and zoned) by late developer Bill Davies.
With Amazon willing to spend up to $5 billion on the HQ2 project, other attractive Chicago locations include the Tribune’s 30-acre riverfront Freedom Center, Related Midwest’s 62-acre development site between the South Loop and Chinatown, and Sterling Bay’s 28-acre former Finkl Steel site near Goose Island.
The reported discussion between Chicago’s mayor and Amazon’s Mr. Bezos isn’t the only recent meeting between the Emanuel administration and a high-profile Silicon Valley CEO. Earlier this summer is was revealed that City Hall had reached out to billionaire entrepreneur Elon Musk regarding the possible use of “high-speed electromagnetic sleds” in a proposed tunnel project that would link Chicago’s downtown and O’Hare International Airport.