Whichever North American city ends up landing Amazon’s second headquarters is in for a wild ride. Just look at what has happened in Seattle over the past 10 years, as the tech giant has transformed its hometown and ignited an unprecedented building boom.
As Amazon begins the search for its second headquarters campus — saying it will be a “full equal” with the first — GeekWire looked back at the company’s growth over the last decade in its first hometown. We analyzed news reports, public records and company announcements to better understand how Amazon has established such a massive footprint in Seattle, and so quickly.
Amazon’s transformation of Seattle is a preview of what could happen wherever the company ends up putting “HQ2,” as it’s called, through the selection process that began this week.
One key takeaway: Even Amazon has underestimated its potential to grow, at least so far. A decade after establishing its campus in Seattle’s South Lake Union neighborhood, the company occupies four times as much space as it originally thought it would need.
Along the way, Amazon’s boom has jumpstarted two Seattle neighborhoods — South Lake Union and the Denny Triangle — and turned them into hubs of construction and activity. Thousands of new apartments house the workers brought to town by Amazon and other tech companies that have since set up shop nearby, including Facebook and Google.
GeekWire worked with Tableau Software to create this visualization showing Amazon’s growing Seattle footprint over the past decade. Click the arrows and circles at the top to see Amazon’s expansion year-by-year, and double-click to zoom in. Hover over the circles for information about each property, and click through for related news coverage. Leased properties are in blue, owned in orange.
Also see this new GeekWire database and map of Amazon’s Seattle office locations.
The growth reflects Amazon’s soaring ambitions — expanding beyond its roots in e-commerce and digital reading into cloud computing, logistics, drones, brick-and-mortar retail stores, artificial intelligence and many other parts of the tech world.
The company now employs more than 380,000 people around the world (up from less than 20,000 a decade ago) including more than 40,000 in Washington state. Amazon says the new campus, wherever it ends up in North America, will employ up to 50,000 people.
All of this started in 2007, when Amazon announced plans to move into a massive 11-building, 1.7 million-square-foot campus in Seattle’s South Lake Union neighborhood, north of downtown, where Microsoft co-founder Paul Allen once envisioned a giant urban park called the Commons. The campus replaced Amazon’s longtime home in an art deco tower overlooking the city on Seattle’s Beacon Hill.
“We could have built a suburban campus. I think it would have been the wrong decision,” Amazon CEO Jeff Bezos later told a shareholder at the company’s annual meeting. Bezos said the types of people Amazon employs and wants to recruit “appreciate the energy and dynamism of an urban environment,” which means the company is more likely to get the talent it wants with an urban campus.
Bezos touted the environmental benefits of urban campuses. However, in a preview of what was to come, he also acknowledged that it’s tough to maintain a contiguous campus when a company gets to “a certain scale.”
The original South Lake Union campus was intended to meet the company’s needs until 2016. Not even close. Today, Amazon occupies 8.1 million square feet across 33 buildings, as the company pointed out in its request for proposals for the second headquarters. That’s more than four times its original campus footprint in South Lake Union. The Seattle Times recently called the city “America’s Biggest Company Town,” with Amazon taking up more than 19 percent of the prime office space.
But that’s just the space the company currently occupies in the city. Last year, Amazon said it would occupy close to 12 million square feet across 40 office buildings in Seattle by 2022.
That estimate may also be low, GeekWire’s research shows. Taking into account everything Amazon owns and occupies, as well as future projects, commitments and a few deals that are rumored but haven’t been finalized, the online retail giant’s office footprint has the potential to surpass that threshold and could eventually balloon to as much as 13.5 million square feet across 44 buildings.
Over the past decade, as the economy has recovered and Amazon and other tech giants have expanded in the city, Seattle’s median home price has risen 54 percent, from $486,000 to $748,500. The population has climbed about 19 percent, to 704,000 people.
Looking at Amazon’s real estate numbers, a few patterns emerge. Amazon moved into the first buildings of the South Lake Union campus in 2010, but the company was already bursting at the seams. It immediately started leasing properties all over town, including several built during the recession that were struggling to fill up at the time.
Amazon again surprised observers in 2012, when it dropped more than $207 million to acquire three blocks of land in the Denny Triangle to build a second Seattle campus, including the eye-catching Amazon Spheres. That came only a couple months after Amazon spent $1.16 billion to acquire its original campus from Paul Allen’s Vulcan. Amazon later acquired two more Denny Triangle blocks to add to its campus there.
Despite owning millions of square feet of offices, Amazon just kept on leasing. In fact, 2016 and 2017 have been the retail giant’s most active years from a real estate perspective, and that’s not even taking into consideration its expanding cadre of grocery and book stores and its new complement of 468 Whole Foods stores.
Earlier this year, the company expanded across Lake Washington to open a new engineering office in Bellevue, Wash., leasing an entire 354,000-square-foot, 16-story building called Centre 425.
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The wild card in this conversation about Amazon’s past and future growth in Seattle is, of course, the second headquarters. Beyond its core campuses in the South Lake Union and the Denny Triangle neighborhoods, much of the company’s space in Seattle is leased, and will expire at some point. Many in the real estate community have assumed that much of its leased space is just a placeholder for people to land until the Denny Triangle campus is fully built out.
A second Amazon headquarters with capacity for 50,000 people, in a city to be determined, certainly has the potential to impact its presence in Seattle. Amazon expects to hire new teams and executives in HQ2, but will also let existing senior leaders across the company decide whether to locate their teams in HQ1, HQ2 or both. The company says employees who are currently working in HQ1 can choose to continue working there, or they could have an opportunity to move if they would prefer to be located in HQ2.
One way or another, Amazon’s next decade promises to be just as interesting as the previous one — in both its hometowns.