Winners Announced:  NYC, Northern Virginia

“It’s possible that [Amazon’s] plan all along was not to open a second headquarters, but to open two, smaller satellites. What’s unlikely, however, is that the deals being offered to Amazon will change significantly, even though the company is effectively halving their investment.”

–“Amazon Scammed America’s Hurting Cities”; The New Republic (Nov. 12, 2018).

“The quickest way to double your money is to fold it in half.”

–Mark Twain

Did Amazon conduct its search for a 2nd headquarters (“HQ2”) in bad faith?

Or, now that the company has announced the winners (plural), is it just a case of runner-up sour grapes?

I have no idea.

And unless someone is privy to Amazon’s C-suite — and the team that oversaw the company’s search — they don’t know, either.

But, surprise, surprise, what seems obvious in retrospect is that the process — including the 11th hour swerve to two satellite offices — was designed to maximize the package of tax and other local government incentives Amazon will reap.

Flushing Out the Other Side’s Terms

That’s because, like putting toothpaste back in the tube, once a party to a negotiation reveals its true bottom line — as the finalist cities surely did — it’s awfully hard to raise it.**

Even if the other side effectively reduces its offer — in Amazon’s case, by exactly half.

Call it, “the Mark Twain school of negotiating.”

**Given the bidding war dynamic between Amazon and the contending cities, it would be more accurate to say “top line” and “lower it.”

See also, “Speed Dating America”: Travel Writer Checks Out 229(!) U.S. Cities to Pick New Hometown“; “Highest & Best” Redux for Amazon HQ2 Contestants?“; “The Key to Successful Negotiation: Getting to Yes? Or, “Getting to “No?”“; “Negotiating, Ray Donovan-Style: When a Tie = a Win”; and ““Splitting the Difference” & Other Negotiating Tactics.”

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

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