'The jobs came faster than the housing': In Seattle, Amazon's rise also delivers growing pains
SEATTLE (WTVD) -- Before Amazon makes its decision on a second headquarters, the cities vying for the coveted investment -- including Raleigh -- are also looking to learn from the tech giant's experience at its current home in Seattle.
The company's new headquarters -- dubbed "HQ2" -- will be a full equal to its current campus in Seattle, which already includes 8.1 million square feet of office space and counting. After reviewing more than 300 submissions from cities large and small, Amazon announced earlier this year its short list of 20 finalists. The decision is expected later this year, and if the Triangle is chosen it could have a far-reaching impact on everyone in the community.
RELATED: $5 billion. 8 million square feet. Here's what Amazon HQ2 would look like in the Triangle
The ABC11 I-Team spent several days in Seattle to give our viewers an exclusive look inside the tech giant to help us understand what it is many politicians and business leaders are wishing for.
Helping small businesses
Seattle's famous Pike Place Market may be known to for its fish, but several new local eateries are featured in the market's first expansion in more than 40 years. Among the market's new shops is Indi Chocolate, whose owners credit Amazon's presence in Seattle for helping the business grow from its founding in a closet-sized office to a mainstay at one of Seattle's premier attractions.
"They've brought sophisticated, educated, well-paid people who are looking for interesting and unusual products," Indi Chocolate co-owner Peter Shank tells the I-Team. "I think (our company) might not have grown the way it's grown without the huge amount of interest and curiosity and money, and I think Amazon - anyone would have to say they're a large part of that whole scene here in Seattle."
Amazon's campus of 38 buildings (and counting) is located only a couple miles away in downtown's South Lake Union district, and managers shared an employee survey with the I-Team showing as many as 70 percent of the 45,000 strong workforce lives in the City of Seattle.
In total, the company reports a $4 billion investment in its campus, while its analysts estimate that Amazon's presence in Seattle has created an additional 53,000 jobs outside Amazon, including construction, healthcare, and hospitality. While unemployment in Seattle (and greater King County) was 9 percent in 2010, by the end of 2017 officials put the number at 3.6 percent -- that is 0.6 percentage points below the national average and a drop of 5.4 points in 5 years.
Jon Scholes, CEO of the Downtown Seattle Association, calculates that since the company moved to South Lake Union more than 2,000 small businesses have opened in the neighborhood.
"Jobs in the center of your city is about the best thing you can have for the center of your city," Scholes asserts to the I-Team. "It means lots of jobs for that company and great tax revenue, employees that are supporting restaurants and bars and art museums and small retail. They've had an incredible effect on our downtown and they've been a catalyst for so much else."
Seattle's growing pains
As Scholes lists several positives from Amazon's impact on Seattle, he also concedes some of the growing pains the city continues to endure: a meteoric rise in the cost of living, a finite supply of affordable housing and a universal apprehension to traffic.
"This company grew faster than they thought they would and that the city thought they would," Scholes says of Amazon. "When it comes to transit services, parks and public space and housing, you've got to move quickly to make those decisions and investments as a city government and county government as well."
Put simply, Scholes says Raleigh should "move fast" before Amazon even makes its announcement on HQ2, and cautions that Amazon's 50,000 new jobs are only those of Amazon -- not the other companies that follow. Hulu, Twitter, Snapchat and AirBnb are among several other companies with offices in Seattle.
"We've built a lot, but not enough. The jobs came faster than the housing and we needed to move faster than that."
The result, according to real estate analysis, is a median home price of $830,000 in Downtown Seattle and $635,000 in all of King County. Both of those numbers are the highest in the state, and they're also about 38 percent higher than the peak median price in 2007 ($429,950) -- before the Great Recession.
With rising home prices there's also been a rise in homelessness; the organization One Night Count estimates more than 10,000 people living in tents or on the streets in Seattle. Seattle Public Schools administrators confirm that number includes about 3,500 of its students.
Political pushback
While much of Seattle's business and political community lauds the company's effect on the city, one outspoken member of the city council is unabashed in her criticism.
Kshama Sawant, a council member since 2014, is a self-identified socialist whose contentious movement to tax Amazon has earned the ears - and ire- or many city establishments.
"If you have a huge corporation like Amazon moving in, then no doubt it's going to exacerbate the problems of affordability," Sawant warns to ABC11. "That's what we've seen in Seattle, and I suspect that's what we'll see in other cities."
Sawant is actually very familiar with the Triangle, having graduated from NC State with a PhD in Economics and spending some time working as a software engineer for a company in Research Triangle Park.
"Now we have a Puget Sound region affordability crisis. If I use that and think about what can happen in Raleigh, what are you going to see? You're going to see rents go up not just in Raleigh, Durham and Chapel Hill but you will see those effects spill over to Cary, Holly Springs, Apex, all the neighboring regions there."
While vehemently against the tax, Amazon is not shying away from the city's struggles. For the last two years, Amazon's campus in South Lake Union has hosted Seattle nonprofit Mary's Place, a shelter for more than 65 families at a time in two former hotel buildings located on Amazon's campus.
Within these two shelters, Mary's Place has provided more than 128,000 bed nights, served more than 300 families - including 700 children - provided more than 230,000 meals and helped more than 150 families move into stable housing.
Amazon, moreover, is currently building Mary's Place a permanent shelter within one of the new office buildings. The site will consist of 47,000 square feet can house over 200 women, children, and families at a time.
