Like firecrackers on the 4th of July, Amazon and every move they make in real estate is like another firecracker going off on the holiday. The latest involves a pseudo “Headquarters Two” in Bellevue. The latest statistics involve the acquisition of a 260,000 square foot building and about 3.2 acres of high rise developable land. This follows on the heels of leases for 280,000 square feet to be added to an existing 750,000 square feet and leases in another two tower development. The projection for Amazon is to grow from their existing 2500 employees to a total of 25,000 in Bellevue. That is the equivalent of approximately 3,900,000 sf of space based upon 150 square foot per employee.
Amazon also announced a huge center in Bessemer, Alabama. That is the same name associated with the steel industry. This is a distribution center of 855,000 square feet in this suburban setting 20 minutes southwest of Birmingham. Why is it not Bellevue? The answer is insightful when you think about economic impacts. Bessemer has a medium household income of $31,308 with a population of 26,697. Compare this basic assumption that the medium income is $18,000 and Amazon will pay $15 per hour. Compare that with the starting salary locally of over $100,000 in Bellevue.
The impact on Bellevue and the Eastside is clearly going to be profound. Right now, Amazon has fueled the growth of WeWork to project a growth to 2.4 Million square feet from their current level of 1.4 Million square feet. This is a major source of employees and subleased space by Amazon, which is not counted in the total.
Given the political climate in Seattle, and the pending election this fall in 2019, it might not be a good time to gamble in terms of Seattle. The professionals of Seattle Commercial Real Estate counsel our clients to be cautious. Rampant enthusiasm can be great or totally bad. Use good judgment.