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Amazon Arrives on the East Coast Ready for Government Contracts
There goes the neighborhood! Technology and online commerce giant Amazon has chosen new headquarters—plural. Amazon will have two new headquarters in Long Island City, New York, and in Northern Virginia.
UPDATE: Due to pressure from certain New York politicians, Amazon has backed out of its plans for New York! Please only focus on the Virginia/D.C. aspects of this article, which was written before Amazon changed its plans.
The motive is unmistakable. By moving to New York City and Northern Virginia, Amazon will cozy up to the financial and federal power centers of America. Long Island City is close enough to Wall Street. Amazon’s move to the Arlington and Alexandria area of Northern Virginia is an obvious play for access to the Pentagon and Washington, D.C.
Next to the Pentagon and across the Potomac River from D.C., the trio of Pentagon City, Crystal City, and Potomac Yards is ideally situated for federal and defense contracts. At the same time as the news of Amazon broke, these three Northern Virginia cities also announced a combined re-branding as “National Landing” to double-down on their proximity to the nation’s capital.
Two new headquarters on the East Coast will create more than 25,000 jobs each in New York City and Northern Virginia, a total of 50,000 new hires. Amazon will begin hiring for the new positions as early as 2019. The headquarters moves also come with $5 billion of Amazon investment, matched by $2 billion of tax and other incentives by the cities.
Amazon’s founder and CEO Jeff Bezos released this statement:
“We are excited to build new headquarters in New York City and Northern Virginia. These two locations will allow us to attract world-class talent that will help us continue investing for customers for years to come. The team did a great job selecting these sites, and we look forward to becoming an even bigger part of these communities.”
Thanks to Amazon, the East Coast can expect tens of thousands of downstream job opportunities related to these moves, in addition to the 50,000 new Amazon employees. Undoubtedly, the Amazon’s presence will galvanize the respective real estate markets and pump up consumer spending and tax revenues.
The new headquarters in Northern Virginia also demonstrates continued interest in federal and defense contracts. As someone who is personally and professionally invested as an expert in government contracts in Northern Virginia, I am curious to hear your perspectives, thoughts, and concerns—feel free to email me!
Amazon already sunk its teeth into several juicy government contracts, breaking into the relatively new market of cloud computing, which Uncle Sam is eager to adopt. In the federal government contracting marketplace, three solid business development pipelines for the future are cloud computing, cybersecurity, and IT infrastructure modernization.
Not only did Amazon win a lucrative cloud services contract for the CIA and other intelligence agencies, it’s also a front-runner to win the Pentagon’s multibillion-dollar “JEDI” contract, which also covers cloud computing. In fact, Amazon’s competitors like Microsoft, IBM, and Oracle complain that the Pentagon contract seems tailored or rigged for Amazon’s benefit. Maybe those millions and millions of lobbying dollars are paying off, or maybe the solicitation specifications inherently advantage an established giant like Amazon.
In any case, expect a strong lobbying and government contracts presence by Amazon. It’s not just about free delivery of consumer products, Amazon is headed to the power center of Washington, D.C. This journey comes amidst recent calls for regulation of the technology companies by President Trump and others. As tech giants like Facebook, Apple, and Google find themselves in the cross-hairs of federal regulators, free speech advocates, and civil liberty watchdogs, Amazon’s political pilgrimage is prescient.
Christoph Mlinarchik, JD, CFCM, PMP is the owner of www.ChristophLLC.com, providing expert advice in government contracts: consulting, professional instruction, and expert witness services. Contact Christoph at Christoph@ChristophLLC.com.