Amazon pulls out of plan to build HQ2 in New York City amid political opposition

Amazon broke up with New York City – on Valentine's Day, no less.

In a stunning development, Amazon said Thursday it will no longer pursue a second headquarters in New York City amid local political opposition.

The change of plans by the world's largest online retailer comes after reports last week that Amazon was re-evaluating its decision last year to put one of its two new headquarters in Long Island City in Queens.

"After much thought and deliberation, we’ve decided not to move forward with our plans to build a headquarters for Amazon in Long Island City, Queens," the company said on its website.

"For Amazon, the commitment to build a new headquarters requires positive, collaborative relationships with state and local elected officials who will be supportive over the long-term." 

Amazon had promised to bring between 25,000 to 40,000 jobs to the city, in exchange for up to $3 billion in tax breaks from the state and city governments.

Amazon HQ2 competition won't reopen

New York and Virginia won a national competition last year to land the new Amazon headquarters.

Amazon said Thursday it has no plans to reopen the competition and will proceed "as planned in Northern Virginia and Nashville, and we will continue to hire and grow across our 17 corporate offices and tech hubs in the U.S. and Canada."

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In recent days, several cities, including Newark, New Jersey, said they would be eager to talk again to Amazon if the Seattle-based company wanted to reconsider its plans.

Amazon made it clear Thursday local opposition was too great an obstacle for the Queens project to continue.

"While polls show that 70 percent of New Yorkers support our plans and investment, 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 with the project we and many others envisioned in Long Island City," the company said.

How opposition built up

The public subsidies for the project, plus the concerns about gentrification of Long Island City, sparked significant opposition from residents and political leaders, including Democratic Rep. Alexandria Ocasio-Cortez.

"Anything is possible: today was the day a group of dedicated, everyday New Yorkers & their neighbors defeated Amazon’s corporate greed, its worker exploitation, and the power of the richest man in the world," she wrote on Twitter.

Those opposed to the headquarters being built in Long Island City feared public services in the city – subways, schools and neighborhoods – would be overtaken by Amazon.

What may have been the final straw for Amazon was a recent decision by the state Senate to add one of the most vocal opponents of the project to a little-known state board – the Public Authorities Control Board.

The Senate appointed Sen. Mike Gianaris, D-Queens, to the board, which would have needed to approve at least some of the public aid for the project.

“Today’s behavior by Amazon shows why they would have been a bad partner for New York in any event," Gianaris said in a statement. "Rather than seriously engage with the community they proposed to profoundly change, Amazon continued its effort to shakedown governments to get its way."

Supporters dejected

New York Gov. Andrew Cuomo put the blame squarely on the Senate for scuttling the deal.

"A small group of politicians put their own narrow political interests above their community – which poll after poll showed overwhelmingly supported bringing Amazon to Long Island City – the state's economic future and the best interests of the people of this state," he said in a statement. "The New York State Senate has done tremendous damage. They should be held accountable for this lost economic opportunity."

But Cuomo said the reasons Amazon wanted to come to New York – its talent pool, education system and diversity – will remain even without the company. "We won't be deterred as we continue to attract world class business to communities across New York state," he said.

Cuomo and New York City Mayor Bill de Blasio had helped broker the deal and warned that local opposition could scuttle the arrangement. 

Cuomo's office said the $3 billion in public subsidies would be small compared to the nearly $30 billion in economic activity and jobs the company would bring to the city and metropolitan area.

De Blasio knocked Amazon for the decision Thursday.

"You have to be tough to make it in New York City," he said in a statement. "We gave Amazon the opportunity to be a good neighbor and do business in the greatest city in the world. Instead of working with the community, Amazon threw away that opportunity."

Republicans in New York blamed Democrats for scuttling the deal, which would have led to job opportunities for the whole region, including the Hudson Valley and Long Island.

"From the start, the Senate Democrats have politicized and poisoned this process just so they could avoid the wrath of the extreme left wing of their party," said Senate Republican Leader John Flanagan, R-Suffolk County.

Dissenters applaud Amazon's decision

Unions had also protested against Amazon's arrival, and, along with their supporters, hailed their ability to beat back a corporate giant Thursday.

"Ultimately, Queens is not for sale," said Sen. Jessica Ramos, D-Queens.

The company has refused to unionize its workforce. Unions opposed the big tax breaks for the world's most valuable company and the world's richest man. Critics said Amazon refused to work with local leaders to assuage their issues.

“Rather than addressing the legitimate concerns that have been raised by many New Yorkers, Amazon says you do it our way or not at all, we will not even consider the concerns of New Yorkers – that’s not what a responsible business would do,” said Chelsea Connor, spokeswoman for the Retail, Wholesale and Department Store Union.

Reaction from Queens

Long Island City, overlooking the Manhattan skyline, is a mix of glass high-rise buildings, industrial businesses and new construction interspersed with chic coffee shops.

On Thursday, reaction was mixed to Amazon's decision. After the announcement in November, rents rose and renters quickly scooped up vacant apartments.

“It’s a bit cruel and inconsiderate to get people all stirred up," said Miguelina Rodriguez, an urban studies professor at CUNY's LaGuardia Community College in Long Island City. "Landlords were practically doubling and tripling the rents in a matter of weeks in anticipation of Amazon's arrival.”

But others said they were pleased with Amazon's decision.

“I moved out of Long Island City three years ago because things were getting too expensive," said Betsy Alwin, 45, an artist. "It’s good that Amazon listened to the people. I think it’s good that we make sure that large corporations aren’t just getting handouts unless people are really going to benefit.”

Around lunchtime at a busy Starbucks on Jackson Avenue, the main thoroughfare that runs through the area, it was business as usual as workers bundled beneath bubble coats, scarves, beanies and the occasional construction hat came in for a cup of coffee. 

Greg Biel, 64, a sales representative at a rubber supply company, said he couldn't understand why Amazon pulled out so quickly.

"It could have been great for the small businesses around here to see more people, more foot traffic," he said.

Contributing: Dalvin Brown, USA TODAY