A Big Investment

A new Amazon headquarters could mean big changes coming to Austin

A new Amazon headquarters could mean big changes coming to Austin

Amazon logo
The city that lands Amazon's next headquarters can expect big changes. Photo by Wallstplaybook.com

Austin was just named the country's fastest growing city over the past 10 years. Following a decade of explosive growth, imagine if Austin lands Amazon’s proposed $5 billion second headquarters? With the massive new presence of Amazon, change in Austin would likely be even swifter and greater.

There is no doubt that our city — considered a leading contender for the so-called Amazon HQ2 project — would undergo a tremendous transformation if the company sets up its satellite headquarters here. But what would an Amazon-amplified Austin look and feel like?

Austin Mayor Steve Adler, for one, believes that what lies at the city’s very heart wouldn’t be changed by the arrival of HQ2.

In a letter to Amazon pitching Austin as the best site for the e-commerce giant’s second headquarters, Adler wrote, “Our long-term goal in Austin is to both preserve the soul of our community and make it accessible to all — even as we excel as a community that continues to attract topic talent.”

After all, he wrote, it’s the soul and people of Austin that matter most.

Right now, Amazon is sifting through 238 proposals from communities across North America, including Austin, all clamoring to host HQ2. The company has said it will not announce its decision until early next year. In the meantime, CultureMap asked four prominent Austinites to look into their crystal balls and tell us how Amazon HQ2 might alter the Austin landscape.

Longtime Austin environmentalist Robin Rather, CEO of local communications and marketing firm Collective Strength, tells CultureMap that Austinites seem to neither loathe nor love the idea of Amazon HQ2 being here. She says the project could set Austin on a positive path.

“If they come here, we will have to build it. We will have to come to terms with another level of our exponential growth and figure out how to handle the water, air quality and, of course, the further gentrification and traffic impacts,” Rather says. “But we have to do that anyway, and perhaps Amazon will serve as a helpful catalyst.”

William Mellor, vice president and general manager of Austin-based AngelouEconomics, an economic development and site-location consulting firm, agrees that Amazon could spur Austin to tackle nagging concerns like traffic congestion and housing affordability — even before Amazon breaks ground on HQ2.

“When you have something like this on the horizon, it can really light a fire and get people motivated to help combat these issues before they become even bigger issues,” Mellor tells CultureMap.

Mellor points to Amazon’s heavy investment in Seattle, the company’s hometown, as an indicator of what the e-commerce titan could accomplish in Austin, particularly since Amazon has signaled HQ2 will be an equal to its original headquarters.

Amazon estimates its direct spending in Seattle from 2010 (when the company moved its headquarters to downtown Seattle) through 2016 boosted the local economy by $38 billion. That sum is roughly equivalent to the economic impact of 109 annual SXSW festivals.

With as many as 50,000 jobs planned at Amazon HQ2, the company eventually would eclipse the likes of H-E-B, Dell Technologies, and Apple as the dominant corporate employer in the region. Today, Amazon already is a key player in the area’s workforce, given its huge warehouse in San Marcos and corporate office in Austin, not to mention its recent $13.7 billion purchase of Austin-based Whole Foods Market.

“If Austin is the winner of this project, then we can expect the obvious impacts of jobs and investments, but we can also expect benefits from investment into the community at large,” Mellor says.

At what cost would that come, though?

Certainly, bringing HQ2 to Austin wouldn't necessarily mean lavishing millions of dollars in tax breaks upon Amazon. Although details of the proposal remain under wraps, Austin officials say the city’s HQ2 bid doesn’t include financial incentives.

However, Austin native Lani Rosales wonders whether her hometown would wind up paying another price for HQ2.

Rosales, chief operating officer of The American Genius, an Austin-based national news network for entrepreneurs, and co-founder of Austin Digital Jobs, a Facebook group that promotes job openings in the Austin area, says she’d be proud to have Amazon expand in Austin, but worries  the company's arrival means exacerbating the city's existing issues.

“That said, I don’t feel confident that Amazon will choose Austin because our infrastructure — public transportation, roads, housing, international travel options — is already struggling to keep up with our consistently expanding population,” Rosales tells CultureMap. “Add the population equivalent of the University of Texas student population overnight, and you’ll breed local resentment against a company for clogging up the pipes, so to speak.”

Austin City Council Member Jimmy Flannigan, former president of the Austin Gay and Lesbian Chamber of Commerce, isn’t fretting about HQ2 possibly clogging the city’s pipes. While HQ2 would produce up to 50,000 jobs in Austin, that’s “still a fraction of a fraction of the size of this community,” he says.

Besides, he tells CultureMap, Amazon could help Austin take on challenges that have been triggered by economic and population growth.

“If Amazon is really looking for the thing they said they’re looking for, they shouldn’t expect the City of Austin to give away the store,” says Flannigan, referring to financial incentives. “But on the other side, if Amazon is looking for a vibrant community, an educated community, and one that’s looking for a strong corporate partner, they’ll find a good partner in the City of Austin.”

But would that partnership tarnish our “Keep Austin Weird” culture?

Mellor, for one, doesn’t think so. Other major employers have come to town, he notes, yet Austin has managed to retain its quirky vibe.

“I would expect that if we were to win Amazon,” he says, “then we would still be able to keep that weird quality, although we’d probably have to work at it a little bit.”

Mellor likes the odds of Amazon putting our weird city on its short list for HQ2, in part because of our top-notch quality of life, our relatively affordable housing as compared with a number of other major metro areas, and our status as the headquarters of Whole Foods.

And for all the pluses and minuses of Austin potentially becoming the home of Amazon HQ2, it appears Amazon might — just might — be more cheered than jeered if it casts the final vote for our city.

“If you enter a prom queen contest, you want to win,” says Rather. “And if we win it, we’ll welcome them with open arms as we always do.”