This past week, company representatives confirmed that the plans to build Amazon HQ2 in Long Island City, Queens, NYC have been canceled. While the decision is backed by some New York City officials, others are disappointed by the company’s decision.
Why Amazon Changed Its Plans
In an effort to diversify the city’s economy, supportive local officials offered Amazon almost $3 billion in government incentives. After the announcement for Amazon HQ2 in November 2018, the same local officials and Amazon received backlash from opposition ranging from residents to local politicians and lawmakers. Along with criticism of the incentive package, locals fell into heated debates over the highly-likely rise in the cost of living and property prices that Amazon HQ2 would bring with it. Amazon’s corporate practices also came under fire.
Related: The Amazon HQ2 Decision: How It Will Impact US Housing Markets
As the opposition against Amazon HQ2 in New York City had shown no signs of subsiding, the company made the decision to pull its plans (that came with 26,000 jobs) on Wednesday, despite the presence of supporters in the city, namely Governor Andrew M. Cuomo and Mayor Bill de Blasio.
“A number of state and local politicians have made it clear that they oppose our presence and will not work with us to build the type of relationships that are required to go forward,” Amazon said in an official statement.
What’s Next for Amazon HQ2?
The original plan was for Amazon HQ2 to be split among two locations: Long Island City and Arlington County, North Virginia along with a new distribution hub in Nashville. Plans will move forward in North Virginia and Nashville. However, Amazon will not be looking for a new home for the second half of its headquarters.
Instead, the company has plans for growth across its current distribution hubs in Boston, Austin, Vancouver, Pittsburgh, and Detroit. Amazon also plans on adding more jobs in its current hubs in New York, specifically in Staten Island.
What’s Next for the Long Island City Real Estate Market?
The Long Island City real estate market was expected to see a huge spike in demand and a rise in property values and prices thanks to Amazon HQ2. Since Amazon’s announcement, there was a significant increase in the number of closed real estate deals in neighborhoods near the future headquarters as interest in these areas increased. So what does the cancellation of Amazon HQ2 mean for the local real estate market?
While many agree that the loss of potential jobs and tax revenue is a blow to the local communities of New York City, most agree that the housing market will do just fine without HQ2. With a healthy growth of inventory in the Long Island City real estate market that is still projected to be met with consistent demand (even without Amazon HQ2), this real estate market will continue to prosper.
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