Toronto will face “fierce competition” to land Amazon’s second headquarters, but its mayor and several experts think it has a chance.
Amazon, the eCommerce giant, is vowing to spend $5 billion to build a massive operation for up to 50,000 employees, equalling its current headquarters in Seattle. The company issued a request for proposal to cities across North America, laying out its demands, including 500,000 square feet (46,451 square metres) of space by 2019 that could eventually extend to more than eight-million square feet.
Amazon boasts its operation has delivered $38 billion to Seattle’s economy, and Mayor John Tory told reporters he wouldn’t be doing his job if he didn’t take a shot at bringing that kind of economic boost to his city.
‘Tax breaks won’t create talent … people want the access to our diverse talent base.’ – Mark Cohon, Toronto Global Chair
“I think when we take the quality of the people we have here … the cosmopolitan, cool nature of this city — and we really put that forward — I think it’s going to be a powerful case,” Tory said.
To win, the city plans to emphasize its recent tech boom, access to thousands of well-educated university graduates and, in the age of Trump, the benefits of Canada’s immigration system. It’s also likely Drake will get name-dropped.
However, the mayor says there’s no guarantee Toronto will come out on top when Amazon makes its decision in 2018, especially given the potential tax breaks rival cities and states may lavish on Amazon.
Hopes city won’t have to offer major incentives
Toronto Global, a newly-formed organization focused on bringing big business to the GTA, will be working on the bid. Mark Cohon, the organization’s chair and former commissioner of the CFL, told CBC Toronto it plans on taking its best shot.
“This is the Olympics of the corporate world,” he said.
Cohon (the first to reference Drake and Toronto’s music scene) says he’ll be working with nearby municipalities over the next month to find potential sites for Amazon, and does believe there’s room. The biggest selling point, he says, will be Toronto’s workforce.
“Tax breaks won’t create talent,” he said, taking a swipe at potential rivals.
“People want the access to our diverse talent base.”
Toronto already a tech hub
Amazon says it ideally wants to set up in a city with more than one million people, something that would rule out Kitchener-Waterloo (a top Ontario tech hub) and Hamilton, but not other Canadian cities like Montreal, Calgary and Vancouver, whose mayors have all expressed interest.
In the last year, Toronto has outpaced New York and San Francisco combined when it comes to tech sector growth, Cohon said, and the city recently opened a brand new facility at the University of Toronto focused on artificial intelligence.
Eric Norman, the managing director of TechTO, an organization focused on supporting the growth and development of the Canadian tech community, says Amazon has a presence in this city and is already looking to hire more people.
“They’re well aware of what’s going on here,” he said.
Norman says Toronto has a better chance than most people think, however, it will come down to whether what the city’s offering matches up with what Amazon needs most.
For example, it may be helpful to operate in another country. “Considering where the politics are going in the States, we have gone the opposite way in how we look at bringing in high-tech skilled workers, so this could be a natural hedge,” Norman said.
Then again, there’s always the risk that the renegotiation of the North American Free Trade Agreement (NAFTA) could snarl business.
“I think, generally, we will be judged upon the city and what we can offer more than the country,” Norman said.
“I don’t think this is a decision [Amazon] will make lightly.”
Company trying to create a ‘home’
Professor Seung Hwan Lee, at Ryerson’s Ted Rogers School of Retail Management, says he thinks Amazon will see setting up in Canada setting as a big plus, and having a headquarters near the east coast also makes sense.
While other big tech companies like Google and Microsoft have set up offices in the GTA, Lee says Amazon’s move would be the first huge commitment. “They’re really trying to create a home,” he said.
Lee says based on size alone, he doesn’t think other Canadian cities have a chance, but that customers across the country could benefit if Toronto succeeds. Right now, Amazon.ca offers far fewer products than its American counterpart, which Lee says may start changing if the company sets up in this country.
Cities have until Oct. 19 to file their applications to Amazon. Toronto will face “fierce competition” to land Amazon’s second headquarters, but its mayor and several experts think it has a chance.