Amazon could be reconsidering its NYC headquarters site due to local opposition

  • Opponents of Amazon new headquarters in New York include Rep. Alexandria Ocasio-Cortez, who cheered the report.
  • Amazon selected the Long Island City neighborhood in November.
  • Amazon has yet to build or lease any space in Long Island City, and isn't expected to receive full approval from local governments until 2020, The Washington Post reports, citing unnamed sources. That makes walking back a deal relatively easy.

Amazon is reconsidering building one of its new headquarters in New York due to local opposition, including from Rep. Alexandria Ocasio-Cortez, The Washington Post reported Friday.

After a nearly year-long search, Amazon in November selected the Long Island City neighborhood of New York City and the National Landing neighborhood of Arlington, Virginia, as the two sites for its East Coast headquarters. The announcement was met almost immediately with protest by some New York officials and residents who feared Amazon would take over the Queens neighborhood, drive up prices and and push out existing residents.

Each of the new headquarters is intended to house 25,000 Amazon employees.

Asked for comment on the report, an Amazon spokesperson did not address if the company is reconsidering its plans to build an office in Long Island City.

"We're focused on engaging with our new neighbors — small business owners, educators, and community leaders," the Amazon spokesperson said in a statement. "Whether it's building a pipeline of local jobs through workforce training or funding computer science classes for thousands of New York City students, we are working hard to demonstrate what kind of neighbor we will be."

Later Friday, The New York Times pushed back slightly on the original Washington Post report. The Times reported Amazon executives were frustrated with the local protests and concerned about a possible veto of the deal at the state level, but had no intention to back out of the plans.

Democrat Ocasio-Cortez, who represents the Bronx and parts of Queens, opposed the project because of the potential displacement of families. She cheered the Post's report.

New York Gov. Andrew Cuomo addressed the deal during an unrelated press conference Friday, saying: "We have to make Amazon a reality."

"For the state Senate to oppose Amazon was governmental malpractice. And if they stop Amazon from coming to New York, they're going to have the people of New York state to explain it to," Cuomo said. "It is irresponsible to allow political opposition to overcome sound government policy. You're not there to play politics. You're there to do what's right for the people of New York, and what they did here was wrong."

The state's agreement with Amazon guaranteed $27 billion in revenue for New York with $3 billion returned to Amazon in tax credits, Cuomo said. He called the deal the largest economic development project signed in the state's history.

"There is no business that brings 25,000 jobs anymore. They don't exist. I spend days trying to bring a business that has 100 jobs or 200 jobs," he said. "Every project has local opposition. ... People just oppose change."

Cuomo and New York Mayor Bill de Blasio were early champions of the deal to move Amazon in, arguing it would bring jobs and economic investment to the city. Representatives for the city did not immediately return requests for comment on the report by the Post, which is owned by Amazon CEO Jeff Bezos.

Many lawmakers and local residents have criticized New York's committed incentives, in particular, arguing city and state officials should be allocating money for subway repairs and public services instead.

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State Sen. Michael Gianaris and City Councilman Jimmy Van Bramer, representatives for Long Island City, said at the time they had "serious reservations" about the deal. This week, Gianaris was selected to serve on the state board that will ultimately approve or reject Amazon's deal.

Gianaris told CNBC on Friday he had not heard any rumblings of a reconsideration before the Post report. He suggested that Amazon could be threatening to pull out as part of a negotiation tactic.

"This is typical of the way Amazon has handled this situation," he said. "If they're trying to extort New York through anonymous threats, they're showing that they're not a responsible corporate actor to begin with. ... If their view is we want your $3 billion or we're leaving, maybe they should leave."

It's unclear what a Plan B for the headquarters would look like, after the spectacle that the first contest became. State and local governments offered tax incentives and other gifts in an attempt to sway the choice.

Amazon has yet to build or lease any space in Long Island City and isn't expected to receive full approval from local governments until 2020, the Post reported, citing unnamed sources. That makes walking back a deal relatively easy.

Citigroup announced in November that it would move more than 1,000 employees out of its Queens office tower in the first half of 2019 to accommodate the first wave of Amazon employees. It's not clear whether a legal agreement was ever formalized.

In addition to the planned developments in New York and Virginia, Amazon is also preparing an investment in Nashville, Tennessee. It will become home to Amazon's East Coast operations hub and create 5,000 jobs.

In comparison to New York, Virginia and Tennessee have been largely welcoming of Amazon's plans.

Read the full Washington Post story.

—CNBC's Jacob Pramuk and Lauren Feiner contributed to this report.

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