Amazon’s HQ2 snub leaves Charlotte wondering, ‘What’s wrong with our city?’

Amazon’s HQ2 snub leaves Charlotte wondering, ‘What’s wrong with our city?’
(Credit: Davie Hinshaw | The Charlotte Observer)
(Credit: Davie Hinshaw | The Charlotte Observer)

CHARLOTTE, NC (Ely Portillo/The Charlotte Observer) -'s decision to leave Charlotte off its shortlist for a second headquarters has left many wondering why the city didn't make the cut when some similar-sized places did.

Sure, Boston, Washington, D.C., and New York were obvious frontrunners among the 238 cities that submitted bids in the wild competition for Amazon's HQ2. All three made the shortlist, along with traditional heavyweights with big populations such as Chicago, Dallas and Los Angeles.

But what really burned some Charlotte leaders was seeing peer cities of a similar size picked over Charlotte. The list included Raleigh; Nashville; Austin; Columbus, Ohio; and Indianapolis. Charlotte's biggest rival in the Southeast, Atlanta, made the shortlist of 20 cities as well. The cold shoulder has left Charlotteans wondering what went wrong.

"Columbus, Ohio, is on there and not Charlotte? I might say that's a little surprising," said Brian Leary, president of commercial and mixed-use development at Charlotte-based Crescent Communities. "If there's 20, you'd expect Charlotte to be on there."

Davidson economics professor Fred Smith said he was most surprised by Amazon's inclusion of Indianapolis, a city roughly the same size as Charlotte without a mass transit system or a flagship research university.

"When I look at Indianapolis and I look at Charlotte, I would have thought everything we had to offer would at least be equal, if not more," said Smith.

Smith and other experts interviewed by the Observer pointed to Charlotte's lack of a nationally known research university such as Duke, UNC-Chapel Hill or N.C. State as a major reason Raleigh was instead picked as a finalist.

The area is also home to Research Triangle Park, a nationally known tech center. That likely outweighed factors such as Charlotte's rail transit and bigger, better-connected hub airport. "The airport," he said, "is probably something (Raleigh) can address and make work for them relatively soon."

Amazon hasn't given any details about why it picked some cities and cut others, beyond pointing to last year's request for proposals that asked for a city with a deep pool of tech workers, mass transit, proximity to good schools, a major airport and the capacity to absorb about 8 million square feet of new office space.

Most of the smaller cities on the shortlist have some identifiable features that hint at why they might have been included. Columbus is home to Ohio State University, with 60,000 students, and is the state capital. Miami is an international city in a low-tax state, with almost 50,000 information workers – almost twice as many as Charlotte – according to the U.S. Bureau of Labor and Statistics.

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Nashville has Vanderbilt University and is a state capital, while Austin is home to the University of Texas and, again, is a state capital. Indianapolis is Indiana's capital and is about 50 miles from Indiana University. Denver is another state capital that made the list and is a half-hour from the University of Colorado Boulder. Pittsburgh is home to Carnegie Mellon University and has gained national attention with its narrative of Rust Belt-ruin-turned-to-tech-driven revival.

Amazon will make the final decision on where to locate its second headquarters later this year. The chosen city and state will get 50,000 high-paying jobs but will likely have to shell out billions of dollars in tax breaks and infrastructure investments to lure the retail giant.

In the aftermath of Amazon's decision, officials in other cities – from Houston to Minneapolis to Tampa Bay, Fla. – that thought they had a good shot are starting to dissect what went wrong. Detroit officials said Amazon told them the lack of a deep enough talent pool and poor regional transit infrastructure hurt their bid. Cincinnati officials said they believe the region's transit was one reason they didn't make the cut. St. Louis officials said a stagnant workforce likely hurt that city.

But in Charlotte, local economic development officials are keeping quiet about why the city was eliminated. A spokeswoman for Bob Morgan, CEO of the Charlotte Chamber, didn't respond to a request for an interview.

Dianne Chase, a spokeswoman for the Charlotte Regional Partnership, which assembled and submitted the region's bid, said CEO Ronnie Bryant had a "short conversation" with Amazon Thursday.

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Chase said the feedback Bryant has received about why Charlotte didn't make the cut was "not extensive."

"Right now he's putting his thoughts together about what to say about the process," Chase said. Bryant was not available for an interview Friday.

The Triad and Hickory were the two other North Carolina markets that didn't make Amazon's shortlist. Neither received any feedback from the e-commerce giant, officials said.

Loren Hill, president of the High Point Economic Development Corp., which submitted the Triad's bid, said he learned from the media that the Triad didn't make the list. Scott Millar, president of the Catawba County Economic Development Commission, said Amazon didn't go into detail about why Hickory wasn't selected.

"They sent a nice email (Thursday) saying, 'Hey, we've chosen our sites and unfortunately you didn't make the cut,' " Millar said.

Chase said the Charlotte Regional Partnership is in discussions about what parts of the region's proposal to release to the public. Although they've made some parts public, such as marketing materials and a video touting Charlotte's "edginess" and appeal to millennials, information about key points such as how much incentives money the region offered and where prospective sites were remains under wraps.

The included information, she said, is "intellectual property of the stakeholders," or the 16 counties that make up the partnership's footprint. The partnership isn't subject to public records laws that would compel the city or county to reveal the information.

"There's tons of fantastic information in there. It's all super-impressive," Chase said. "(But) we want to respect privacy of our stakeholders in the process."

'Cool factor'

One intangible that may have hurt Charlotte is that it's not seen as hip as places such as Nashville and Austin, said Leary, the Crescent executive.

"Charlotte needs to work on its cool factor," he said. Efforts to highlight the city's craft beer scene could help it compete with cultural heavy-hitters like Nashville, known for country music, and Austin, with it's "weird" vibe and music festivals, Leary added.

Omar Kazzaz, a Charlotte-based logistics consultant who has been following the Amazon bidding, said another intangible likely held Charlotte back. It's tough to define, but he said he feels the difference when he walks down the street in a place such as New York City and hears a dozen different languages and accents. He calls it a "global mindset."

Jeff Edge, a former Charlotte Chamber economic development official now with Vikings Mergers and Acquisitions, said Charlotte had an edge with its airport, but the city's big challenge was the ability to absorb so many jobs.

"We're not quite at that level to land a project of that magnitude," Edge said. Still, he said, the process brought positive attention for Charlotte, which could help land smaller relocations.

Edge said he would like to see some transparency around the bid but noted economic developers could be afraid of tipping their hand. As for how the bid was handled, he said Charlotte may have been too broad in offering 21 different sites, saying it might have been better to focus on just two or three at first.

"But I don't think that eliminated them by any stretch," he said.