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HomeBusinessRevealed: Lotusland’s dud bid for Amazon’s second headquarters

Revealed: Lotusland’s dud bid for Amazon’s second headquarters

Bob Mackin 

Vancouver, Surrey and Richmond tried to woo Amazon to set-up its second headquarters in Lotusland with promises of cost savings and secret incentives from the provincial government. 

That, according to the 50-page bid book obtained Feb. 16 by theBreaker

Introduction to the Vancouver Economic Commission bid for Amazon’s second headquarters.

Lotusland was among 238 bids from around North America in October, hoping to lure the tech giant’s expansion, which it said could be worth US$5 billion. In mid-January, 20 cities were shortlisted, including Toronto, which proactively released its 200-page bid book last October. The only Pacific time zone bidder on the list was Los Angeles. 

The Vancouver Economic Commission-led bid book, under the title “Vancouver We Are Home,” said software engineers work for half the price of the Seattle market (US$60,107/year vs. $US$113,906/year), the Canadian loonie tends to be cheaper than the American greenback, and Canada’s medicare system means health care costs are less for employers. The health care costs alone would save US$6 billion over a decade for 50,000 employees, the bid book said, “bringing total savings to USD$34 billion.” 

The bid was handicapped from the start by being too close to Seattle, but the bid book tried to turn that weakness into a strength.

“Seattle and Vancouver are in the same time zone and located only 140 flight miles apart; that’s 2,300 flight miles closer than New York. Not only does proximity provide strategic advantages in terms of collaboration and information flow, but there are also financial and environmental benefits that come with operating 45 minutes apart – a clear benefit for any organization aiming for a triple bottom-line.”

Ironically, both New York City and neighbouring Newark, N.J. made it to the 20-city shortlist. 

The VEC bid boasted that Vancouver’s “DNA is comprised of similar cultures and values as Seattle,” such as environmentalism and left-wing politics. Like Seattle, it said, one can “ski, surf and savasana [yoga’s corpse pose] all in one day.” It included three photographs of Prime Minister Justin Trudeau and a letter addressed to Amazon CEO Jeff Bezos. 

A map suggested Amazon could look for office space at downtown’s to-be-redeveloped Main Post Office, Surrey Central, Broadway Tech Centre and/or an area in North Richmond near River Rock Casino Resort, an area the bid book referred to euphemstically as “Riverside Rendezvous.”

It said the region is already home to tech companies like Microsoft, Boeing (analytics lab), Cisco, Electronic Arts, GE, Intel, and SAP — as well as homegrown companies Slack, Hootsuite, Avigilon, Bardel, D-Wave, Lululemon Athletica and Vision Critical.

The Vancouver bid emphasized outdoor recreation.

Where would all the workers live? The bid book boasted the NDP’s promised 114,000 affordable units in B.C. over 10 years would help in the long run. In the short-term? The suburbs.

“Measures are in place to tackle housing affordability concerns. Despite the high prices in the downtown core, we are fortunate to have a wide variety of affordable housing options all within a 25-minute radius of our top sites for Amazon HQ2.”

The only section containing substantial censorship was about provincial incentives. Existing digital and production tax credits were offered, but it is not known what the NDP government was offering, except for the visible mention of  “a dedicated B.C. Provincial Nominee Program Solution for Amazon” to fast-track migration. 

The bid book stressed B.C.’s network of universities and colleges, but made special mention of foreign students and migration from Asia. In 2015-2016, 19,875 B.C university students were from China, more than India, U.S., Japan and South Korea combined. 

“The Chinese student population in BC increased by 17% annually between 2010 and 2015. The Asian student population also views Vancouver as a long-term home. 43% of Vancouver residents have Asian heritage, making it the most Asian city outside of Asia. Vancouver’s strong Asian ties are critical as Amazon continues to deepen its business throughout this region and works to ensure its talent can support growth in these key markets.”

Last November, Amazon announced it would double its Vancouver workforce to 2,000 by 2020. It is not clear whether the secret tax incentives in the HQ2 bid book played any role. 

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Vancouver-Amazon-HQ2-Proposal-Feb-2018.pdf by BobMackin on Scribd