North Texas

Amazon's Growth Leads to Congestion, Higher Cost of Living in Seattle

Deadline for HQ proposals is Oct. 19

Amazon gets strong support from many leaders in Seattle for bringing more than 40,000 high-paid tech workers and their spending power to that city just since 2010.

Other companies have joined Amazon with tech hiring in Seattle.

But so much rapid growth has also increased traffic congestion and the cost of living in Seattle.

Suping Liu runs the Golden Daisy Chinese Restaurant in the Beacon Hill neighborhood of Seattle.

"Very expensive right now, everything," she said.

If she were moving to Seattle right now, Liu said she could not afford to buy the home she paid $300,000 to purchase years ago.

"Ten, 15 years before. But right now my house goes to $700 (thousand) right now," she said.

Tour Amazon's Seattle HQ, Surrounding Area

Beacon Hill was a working class neighborhood with comparatively affordable homes by Seattle standards. Now, a new Seattle light-rail station makes it easier for people from other, even more expensive, parts of the city to get there. It's helping to increase property values in Beacon Hill.

Cary Moon, candidate for Seattle mayor, recently held a rally in Beacon Hill where many supporters were concerned about the soaring cost of living and congestion.

"I couldn't sit by and watch our city not deal with all these challenges," Moon said. "I would like corporations who are attracting so many people to our region to pay for the impacts of growth."

The urban planner and civic leader has found strong support with her campaign to tackle the problems.

"We welcome the growth from Amazon. They've brought great folks to the city. We have an incredible nexus of a lot of tech companies as well as a fairly broad economy across other sectors. But I think if Amazon is going to add 50,000 more folks, it would make sense for them to have a second headquarters somewhere else. Maybe we can grow a little more slowly in Seattle," Moon said.

Amazon's headquarters in Seattle is credited with fostering a vibrant, creative environment downtown -- something for North Texas to consider when bidding for the tech company's second HQ.

Also based in Seattle, the real estate website Zillow tracks home prices nationwide.

"I actually think Dallas is already experiencing some of these things," said Zillow chief economist Svenja Gudell.

Normal yearly home price increases are around 3.5 percent, Gudell said. Dallas-Fort Worth metropolitan area home prices are up 8.7 percent so far this year, compared with last year, according to Zillow. Seattle area prices are up 12.3 percent, and Seattle was already much more expensive.

"You don't have enough for sale homes available, but you have a lot of demand from people actually wanting to buy homes," Gudell said.

If Amazon chose North Texas for a second headquarters, the Zillow expert said pressure on prices would increase.

"It kind of depends on how fast Dallas is with expanding their housing stock, and Dallas certainly has an easier time there than I think Seattle does," Gudell said.

North Texas leaders are touting many possible locations for a second Amazon headquarters location in this region as they assemble a proposal for the company.

Amazon investor Matt McIlwain with Madrona Venture Group in Seattle said Amazon has been an overwhelmingly positive impact.

"Our wage growth is double the national average here in Seattle. Our unemployment rate is 2.7 percent, which is the lowest in our history and one of the lowest major urban areas in the country," he said. "So it's unquestionably good. Now with growth are there stretches and strains that go with that? Absolutely there are."

Todd Bishop, with Geekwire in Seattle, is a long-time Amazon observer.

"You've got tons of people coming into this town, fresh out of college, coming in from other tech companies — Silicon Valley, Boston, New York — flooding into this community because it's a place they want to be," Bishop said. "It is the kind of economic boom that cities would spend hundreds of millions to try and generate in terms of incentives, and I think we're going to see that in the RFP. This is a good problem to have and that is the upside."

Amazon wants responses to the Request for Proposals from cities hoping to land the second Amazon headquarters by Oct. 19.

The Dallas Regional Chamber of Commerce is assembling a North Texas bid.

Amazon's Request for Proposals:


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