More than two decades ago, long before Amazon was the king of online retail and cloud computing, the company ran out of Jeff Bezos’ garage in Bellevue, Wash., across Lake Washington from its current headquarters in Seattle. Bezos, now the second richest person on earth, would himself march packages out to the post office in Bellevue to be sent out for delivery.
Fast forward to 2017: Amazon is one of the most valuable companies in the world, and it is getting ready to open a new office in its original hometown of Bellevue, a surprise expansion outside of the Seattle urban core. GeekWire reported the plan last year, and Amazon earlier this month confirmed the new office, in the 354,000-square-foot Centre 425 building. Employees are set to move in this summer.
Chatter amongst the real estate scene has it that the new Bellevue office is not a one-off, and Amazon is looking for even more office space in downtown Bellevue and surrounding areas. Amazon’s Vice President of Global Real Estate and Facilities John Schoettler did not confirm the rumors, but he told GeekWire that Amazon has no plans to slow its growth.
“I don’t have a crystal ball; I know that as a company we are going to continue to grow and hire great talent that we find in the Pacific Northwest,” he said. “So I would imagine that you will see us growing on both sides of the lake.”
The online retail giant has been headquartered in Seattle for much of its existence, and Bezos has repeatedly touted the benefits of staying in the city rather than creating an isolated campus in the suburbs. The Bellevue office looks more like one of Amazon’s Seattle buildings, right in the middle of a dense urban area, not tucked away from the rest of the city.
The deal is a big win for the city of Bellevue, which was reeling a year ago from several un-leased office projects under construction and the impending departure of Expedia to Seattle. With this office, Amazon joins a growing list of companies setting up shop both in Seattle and somewhere on the east side of Lake Washington to access talent around the region as commuting between Seattle and Bellevue becomes increasingly more difficult.
Schoettler said the Bellevue office will house incremental new hires, rather than teams coming over from Seattle. That means a variety of teams will work out of the space. The plan for now is to hire about 1,000 people for the new office, with the potential to grow in the future.
It’s part of a larger employment boom that has dramatically increased Amazon’s regional and global footprint. Amazon employs more than 350,000 people. That includes 40,000 employees in Washington state, many of them in a growing number of buildings in Seattle’s South Lake Union and Denny Triangle neighborhoods.
Amazon last year quietly launched a pilot shuttle program to bring some of these employees from several Eastside cities over to its Seattle campus. Schoettler said the shuttle system could be adjusted as needed.
Amazon has contemplated the idea of an Eastside office on several occasions. Schoettler, a past chair of the Seattle Metropolitan Chamber of Commerce Board of Trustees, painted the move as a “regional play,” and said the Seattle-Bellevue area has become less like a couple of disparate cities and more like one big area, teeming with talent in all directions.
About 75 percent of Amazon employees live on the west side of Lake Washington, up and down the Interstate 5 corridor. That leaves only 25 percent of its workforce living on the Eastside or in other areas, and Amazon would like to tap into the talent there.
The new Bellevue office could certainly make Amazon more attractive to Eastside residents, and there are a host of companies that Amazon could poach from. There is Expedia, whose employees are looking at a much longer commute in a couple years. And then of course there is Microsoft, one of Amazon’s chief cloud competitors.
Shauna Swerland is CEO of Fuel Talent, and she has recruited for Amazon in the past. She agreed that the Bellevue office puts Amazon in prime poaching territory. But, in her experience, most people already know if they want to work for Amazon or not, and a new office space probably wouldn’t change that.
Still, the Bellevue office shows that Amazon is willing to go where the people are, rather than bringing everyone to South Lake Union. Not only will that help Amazon poach talent, it could show some people who may have reservations about the company culture that it cares about employees.
“It’s an opportunity for Amazon to be able to tell a story that they are people-centric, and that they are not just customer-centric and customer-obsessed but they are employee-obsessed,” Swerland said.
Both sides of the lake
Amazon is following a recent wave of big companies opening offices on both sides of Lake Washington. Google and Tableau Software are perhaps the most high profile examples. Microsoft years ago had big plans for a Seattle expansion, and until recently held onto some offices there.
Split offices are common in San Francisco, with many companies having outposts in the city and Silicon Valley. But it remains relatively rare here, and something that only a few companies have the luxury of doing.
However, traffic increases could make the trend more common. According to Kirkland-based Inrix, Seattle drivers spent an average of 55 peak hours in congestion in 2016. Inrix ranks Seattle traffic as the 10th worst in the U.S., and 23rd worst in the world.
“With our traffic becoming worse, (companies) are realizing they need to have a satellite or even a large presence on the Eastside,” said Bill Cooper, a broker with Colliers International’s Bellevue office.
Traffic has become a consideration for job seekers, Swerland said, but it rarely tops the list as a deciding factor in whether someone takes a job or not. Tech workers still want to believe in the company and the products they are building and still care more about compensation than commute.
But tech companies are seeking out any possible advantage in recruiting top candidates, and for some, commute could be a tiebreaker.
Underpinning this trend is a steady influx of companies from other tech hubs opening offices in the area. And it’s not just in Seattle, said Suzanne Dale Estey, president and CEO of the Economic Development Council of Seattle & King County. Some companies want to set up shop in Seattle, while others want to be out in the suburbs where office space is more affordable, or the downtown core of Bellevue closer to bars and restaurants, or possibly near Microsoft’s home base in Redmond.
“I just think it’s exciting that all of Seattle-King County is a place that these companies are coming from all over the world to be part of our ecosystem here,” Dale Estey said.
Bellevue growing up
The local tech industry has long been stereotyped as being split into two distinct areas in the region, Seattle and the Eastside. Seattle is thought of as the hipper spot, attractive to younger workers who value walkability and great bars and restaurants. Whereas Bellevue and the surrounding cities cater to a little more experienced crowd. They might be married, with a house and kids they plan to enroll in the renowned Bellevue or Issaquah school districts.
While there is still some truth to this dichotomy, the lines are blurring. Microsoft’s leadership shake-up has, in recent years, helped to make the Eastside more attractive to younger tech workers. Dale Estey notes that Bellevue is getting better transit connections with the arrival of light rail in 2023, and it is becoming a more sophisticated city. Arts and culture are booming, and trendy restaurants have become a staple of downtown. The Eastside is more diverse than most would think, Dale Estey said, and the cities are working hard to embrace that.
Bellevue has its own roster of big companies that would make much larger cities blush, including headquarters for companies like T-Mobile, Valve and Paccar, as well as beachheads for Salesforce, HTC, Alibaba and many others.
Colliers International’s Cooper, who works with tenants on both sides of the lake and was born and raised in nearby Issaquah, has seen Bellevue’s growth first-hand, as well as that of the rest of the Eastside. “Finally, I think the Eastside has a critical mass as far as amenities, restaurants, cafes, workout places, places that make the city more exciting, a better place to live and office,” Cooper said.