Even though West Virginia does not have a city vying for the new Amazon HQ2 economic development project, the state still may benefit greatly from the site selection decision slated for the end of this year.
Twenty competing locations have made the shortlist for Amazon’s planned $50 billion headquarters complex, including Pittsburgh, Columbus and three separate sites in the Washington, D.C., metropolitan area. It’s known as HQ2 because it will supplement Amazon’s existing Seattle headquarters.
Each site meets the core requirements necessary for the near-term construction, and subsequent expansion option, of up to 8 million square feet of mixed use buildings and support facilities that will create 50,000 permanent jobs.
Mandatory commercial real estate requirements for the campus-style development include “certified or shovel-ready greenfield sites and infill opportunities” as well as environmentally sustainable construction materials and base building systems.
Highly desirable logistical considerations include proximity to within 30 miles of the center of the selected city’s “rooftop” population, 45 minutes drive-time to an international airport, and mass transportation for commuting.
While traditional infrastructure such as robust and redundant electrical supply are a given for a development of this size, it is the digital world of information technology and communication networks that could very well drive the final decision.
And that’s good news for West Virginia because the one site that has the greatest concentration of data centers and proximity to the thickest distributed fiber network is Loudoun County, Virginia, right next door to the Eastern Panhandle.
As the largest online retailer in the world, Amazon’s decision-making process necessarily has to take into account internet-based IT and communication fundamentals, both physically and virtually.
This is especially true in that its subsidiary, Amazon Web Services, is also the largest “cloud computing” company, which resides not in the ethereal world but on industrial-scale racks and stacks, in millions of square feet of data centers, remotely accessed 24/7/365.
Loudoun County is already home to the highest concentration of server farms in North America, and is at the heart of “Data Center Alley” where fully 70 percent of the world’s internet traffic reportedly flows.
While Amazon typically does not disclose the locations of their own data centers, it is widely accepted that Amazon Web Services already has a huge presence in the county and its east coast corporate offices are currently situated in adjacent Fairfax County.
That Amazon’s core business model also includes significant post-9/11 defense and security contractor work reinforces the site’s appeal, too.
Loudoun County is home to Washington Dulles International Airport and the soon-to-be-completed Metrorail Silver Line extension so it clearly meets the logistical requirements while sufficient traditional infrastructure and comparatively low electricity rates strengthen their bid.
Interestingly, as the wealthiest county in the United States, Loudoun County has experienced some of the highest land value increases over the last decade, as has adjacent Fairfax County, the second-most wealthiest, which has helped fuel growth in West Virginia’s Eastern Panhandle.
Associated economic participation and commuter patterns have already led to both Jefferson and Berkeley Counties as being classified as part of the Washington, D.C., Primary Metropolitan Statistical Area.
Should HQ2 locate in Loudoun County, the spillover effect would be profound and most assuredly fuel an already strong housing market that, in turn, would then further stimulate the growth of new service sector businesses.
Indeed, the multiplier effect could eventually reorder the broader regional economy and even fan out well into West Virginia’s Potomac Highlands where low land values already underpin a market for second homes.
And better yet, the massive tax breaks and incentive packages such as the reported $5 billion offered by the state of Maryland to Amazon for their competing Montgomery County location, will be borne by the Commonwealth of Virginia.