Amazon's HQ2 search didn't quite go as planned.
The tech giant is pulling the plug on a planned Long Island City, Queens location after it sparked a fierce backlash from some local leaders who decried the secretive nature of the deal and its potential negative impacts on the area. Amazon (AMZN) - Get Report shares were down 1.1% to $1,622.4 on Thursday afternoon.
Originally announced in November, the proposed site in Queens quickly turned controversial with some locals welcoming an influx of new jobs and others outraged by the taxpayer-funded subsidies offered to the company.
"The $3 billion taxpayer giveaway was unconscionable especially in the midst of an affordable housing crisis and a crumbling public transportation system which impacts virtually every resident of New York City," said New York Assemblyman Ron Kim, who opposed the Queens site.
The site was expected to produce 25,000 new jobs over time. In return, New York offered a multibillion incentive package that included a cash grant, tax breaks and "performance incentives" between the city and the state of New York. A Quinnipac poll in December showed that a majority of New York City residents supported the Amazon HQ2, though opinions were far more mixed on the incentive package the local governments offered.
More broadly, Amazon's highly publicized HQ2 search had been criticized as a beauty contest and a data grab that forced municipalities to compete on generous incentives for Amazon.
That didn't work in New York City. "The commitment to build a new headquarters requires positive, collaborative relationships with state and local elected officials who will be supportive over the long-term," Amazon wrote in a blog post announcing that it's walking away from Queens.
So where does Amazon go from here?
Amazon said that it does not intend to "reopen the HQ2 search at this time," but that it will go forward with opening new sites in Nashville and Northern Virginia, the other two locations included in the HQ2 split, with Nashville being a much smaller operations center comprising about 5,000 jobs. Amazon will also "continue to hire and grow across our 17 corporate offices and tech hubs in the U.S. and Canada." That includes an existing New York location that currently employs 5,000 workers.
In the meantime, some of the spurned HQ2 finalists made it known that they were still available as reports swirled that Queens was a no-go.
Newark, New Jersey, along with the state, reportedly offered $7 billion in incentives for the HQ2. And Fortune reported this week that local leaders were reaching out to Amazon to express that they're still open to the site should Queens fall through.
Texas is also still game, with the editorial board of a Dallas newspaper writing last week that: "New York will never be the happy home for Amazon that Texas could be." Through comments from local leadership, other onetime candidates including Miami and Chicago also appear to be courting Amazon once again.
In addition to its Seattle headquarters and planned expansions in Nashville and Northern Virginia, Amazon has about 20,000 employees across 18 corporate offices and tech hubs in the U.S. and Canada.