Remember when Amazon turned the United States into Thunderdome, making every state battle over the right to host the company’s next big headquarters and 25,000 jobs? Well, after laying off more than half that number, Amazon is tapping the brakes on HQ2 in Virginia, putting off construction of three 22-story office towers.
The news was first reported by Bloomberg. The first phase of construction, called Metropolitan Park, is nearly complete and will host some 8,000 employees when it opens in June — assuming the new “three days a week” rule remains in place. The second, larger section known as PenPlace was originally set to break ground around now. But that has been indefinitely delayed.
Unfortunately, this includes the shaft-like “Helix” companion building to the “Spheres” in Seattle (known by a different name locally) also being put off.
Although Amazon was adamant that “this shift is not a results, nor indicative, of role eliminations,” it’s impossible to consider the decision without reckoning with the fact that the company recently laid off some 18,000 people across the company. I asked whether employees in Virginia were among those laid off (it seems very likely), but have not received any response.
This isn’t the only place where Amazon seems to have gotten ahead of itself in office space. In its Seattle headquarters, entire floors are vacant and construction has stopped on a new office tower in Bellevue (just east of Seattle) and in Nashville.
It’s not alone in this, of course: Many tech companies were building millions of square feet of new offices leading up to 2020. Amazon wasn’t even the only one going fishing to see which state would offer the biggest tax breaks (Washington State has been leaning left recently and threatening new taxes, emboldening escape plans to friendlier climes).
And it’s not alone in not knowing exactly what to do in this new world of remote work, having invested truly enormous sums on office complexes that, as it turns out, very few employees want or need. Simply forcing people to come in to work has been one “solution,” and kicking the can down the road on more expensive offices is another.
But Amazon committed to bringing 25,000 jobs to HQ2 by 2030 and “our long-term intention and commitment remains unchanged,” the company wrote in a statement. A company as large and durable as Amazon can weather the dual storm of macroeconomic conditions and the folly of its leadership’s business decisions, filling the sails on the next upturn and hiring like crazy when the time comes. After all, there are tax breaks to be had!