Economics / Municipal government

The Amazon HQ2 bid has reportedly cost $545K. What will Philly get in exchange?

A Billy Penn report found that videos, marketing blitzes and legal fees add up: PIDC has spent roughly half a million dollars trying to bring Amazon here.

Philly ads on Seattle buses. (Photo by Chris Beiter)

Almost a year after Philly joined the national scuttle to woo Amazon into setting up its $5-billion HQ2, the costs of making Philly’s case have run up a tab.

Between marketing pushes in Seattle, compiling information on Philly sites like the Navy Yard and the Schuylkill Yards redevelopment, and a hype video featuring local leaders, the total cost of getting Philly to the shortlist of 20 cities has risen to $545,000, Billy Penn reported Saturday.

The bulk of the sum came from the Philadelphia Industrial Development Corporation, a joint venture between the City of Philadelphia and the Chamber of Commerce.

“95 percent of this total was invested in research, data analysis, and development of assets that have already been used in other efforts and will continue to be of use attracting business and talent to Philadelphia well beyond the Amazon HQ2 process,” PIDC’s vice president of marketing communications Jessica Calter told the outlet.

For site consultant John Boyd, head of Princeton N.J.-based site selection firm The Boyd Company, Philly’s expenses in the effort of luring the $5 billion project here are well worth it.

“It strikes me as a reasonable amount and I believe that it’s money well spent,” said Boyd, whose company has helped companies like AT&T and Boeing chose locations for their corporate hubs.

“Philadelphia deserves credit and the benefit of the doubt: Making the top 20 was a major accomplishment,” said Boyd. “This is the largest project in the history of economic development. Taxpayers should look at that figure as money well-spent putting together the strongest case for Philadelphia.”

There’s concern, though, that the deal offered to the Seattle ecommerce behemoth, amid fierce competition between the 20 metro areas selected, might be too sweet. As a handful of local legal battles show, there’s also concerned over secrecy: Philadelphia hasn’t yet revealed specifically what incentives it will offer Amazon if it picks the “Philly Delivers” bid.

The consultant said withholding the details is a “strategic decision” aimed at keeping the trust of Amazon execs.

“There are other reasons, too,” Boyd said. “It could affect negotiations with other companies planning their relocation or expansion.”

For local business leaders like Arcweb Technologies CEO Chris Cera, maybe Philly’s focus should be more on starting a new Amazon here, and providing the tax and legal structure for that to happen. Coded By Kids founder Sylvester Mobley asked to make sure the same collaborative effort behind the bid is replicated in other areas.

Companies: Amazon / Philadelphia Industrial Development Corporation
Series: Amazon HQ2
People: Sylvester Mobley / Chris Cera
Projects: Philadelphia Navy Yard

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