AA Credit Union

Spring 2018

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14 | SPRING 2018 t's good to be Amazon CEO Jeff Bezos these days. He and his team sifted through offers from 238 North American cities settling on 20 fi nal- ists earlier this year. The generous bids included everything from tax breaks to real estate purchase opportunities to specialized training and educational centers all in return for being tapped as the location for Amazon's new HQ2 offi ce. While the online retailer's HQ2 location is still undecided, its request for proposal and sub- sequent vetting process are a perfect example of what companies such as Foxconn, Toyota and Carrier look for when scouting new loca- tions. They also demonstrate why cities are so enthralled with the prospect of being chosen. "The benefi ts of gaining an Amazon [head- quarters] are very macro. More revenue. More state and local taxes paid by the corporation," explains Nela Richardson, the chief economist of Redfi n, a national real estate brokerage. A Laundry List of Needs Companies have specifi c criteria in mind when choosing a new location. A new headquarters needs employees — typically university gradu- ates and skilled labor such as lawyers, graphic designers, business development experts, soft- ware engineers and marketing types. Factory owners also look for new employees, but typi- cally seek out locations where manufacturing already has a foothold — and a talent pool. Transportation is another consideration. Facto- ries look for locales that have access to road and rail networks and enough open land to build long, low assembly lines and supply chain ware- houses. Corporate locations don't care as much about roads as they do proximity to airports and commuter lines. Living conditions are very important, too. All companies want to build where employees want to live. "Your No. 1 consideration [as a corporation] is going to be about talent — attraction and retention of talent and the ability to interface with the rest of the company," explains Kevin Klowden, executive director at the Milken Institute's Center for Regional Economics. All the Perks You just need to look at the proposed fi nancials to understand why cit- ies are jumping through hoops to showcase their suitability. Amazon's second headquarters is projected to bring with it 50,000 new jobs and billions of dollars worth of commercial real estate construction to whichever city lands it. Cell phone manu- facturer Foxconn's recently announced deal is slightly less sweet — a $10 billion factory and more than 3,000 jobs. Apple, which is also talk- ing about building a new headquarters, says it will invest $350 billion and create more than 20,000 jobs in whatever city in which it builds. Direct capital investments and employment gains aside, there are other benefi ts to new fac- I Finance your next home with an American Airlines Federal Credit Union home loan. Learn more about options on Page 33 or visit homeloaans.org.

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