Amazon Pauses Building Second HQ in Virginia

Online retailer Amazon is pausing its construction of its second headquarters campus in Arlington, Virginia, Bloomberg reported Friday.

Amazon real estate chief John Schoettler told Bloomberg in a statement that the company “remains committed” to building the $2.5 billion campus that is expected to employ 25,000 workers by 2030, but is “pausing” breaking ground on the second phase of the project, known as “PenPlace” in the 2.8 million-square-foot development near the Pentagon and Ronald Reagan Washington National Airport, Bloomberg’s report said.

“We’re always evaluating space plans to make sure they fit our business needs and to create a great experience for employees,” Schoettler said in his statement to the news outlet. “And since Met Park will have space to accommodate more than 14,000 employees, we’ve decided to shift the groundbreaking of PenPlace out a bit.”

The huge project is part of the 2017 national competition that saw several states try to develop incentives for Amazon to place its second headquarters in their cities.

According to the report, northern Virgina and New York won out, with Amazon deciding to split the facilities between the locations.

The New York part of the project ended up abandoned after backlash from union officials and politicians who resisted the development, the report said.

Meanwhile, Virginia committed to about $800 million in tax breaks and incentives, including infrastructure improvements, over 15 years to get the anticipated 25,000 new jobs.

“Our second headquarters has always been a multiyear project; and we remain committed to Arlington, Virginia, and the greater Capital Region — which includes investing in affordable housing, funding computer science education in schools across the region, and supporting dozens of local nonprofits,” Schoettler told Bloomberg. “We appreciate the support of all our partners and neighbors and look forward to continuing to work together in the years ahead.”

The move to slow the project comes after the company announced 18,000 job cuts in January, according to Axios.

According to that report, the cuts, focusing on Amazon’s devices and books business, were due largely to a slowdown in consumer and corporate spending.

“We typically wait to communicate about these outcomes until we can speak with the people who are directly impacted,” Amazon CEO Andy Jassy told workers in an internal memo at the time. “However, because one of our teammates leaked this information externally, we decided it was better to share this news earlier so you can hear the details directly from me.”