Thanks to Amazon, Seattle is biggest company town
Seattle — Amazon.com’s extraordinary growth has turned Seattle into the biggest company town in America.
Amazon now occupies 19 percent of all prime office space in the city, the most for any employer in a major U.S. city, according to an analysis conducted for The Seattle Times.
Amazon’s presence in Seattle is more than twice as large as any other company in any other big U.S. city, and the e-commerce giant’s expansion here is just getting started.
The swarms of young workers crowding into South Lake Union every morning represent an urban campus that is unparalleled in the United States — and they have helped transform Seattle, for better or worse. Amazon’s rapid rise has fueled an economy that has driven up wages and lowered unemployment, but also produced clogged traffic on the roads and sky-high housing prices.
And while Seattle’s booming economy is often attributed to a wide variety of factors, increasingly, it’s all about one company.
Amazon now occupies more office space than the next 40 biggest employers in the city combined.
And that’s only the beginning: Amazon’s 8.1 million square feet in Seattle is expected to soar to more than 12 million square feet within five years.
Amazon’s supremacy in e-commerce and cloud computing has translated, locally, into an avalanche of glass, steel, people and money. It’s given Seattle more prominence as a magnet for talent from all over the world, and reshaped formerly forlorn parts of the city, into vibrant live-work-and-play neighborhoods.
The company’s unparalleled impact in determining Seattle’s fortunes may give some pause to those who experienced the downturn of the 1970s, when the shine of “Jet City” was tarnished as Boeing cut about two-thirds of its huge local workforce.
“Seattle’s been through this before,” said Tracey Seslen, a professor at the University of Washington’s Foster School of Business. “If Amazon were to leave, that would create a giant hole in their wake.”
However, unlike Boeing, whose local operations focus on the single business of building airplanes, Amazon runs a vast web of diverse businesses –– selling computing power, retailing nearly everything, publishing books and producing films, among other things.
John Schoettler, Amazon’s director of real estate, says that all he’s experienced in his nearly two decades at Amazon is “steady, continued growth,” the result of the company’s zealous focus on satisfying customers.
The legacy of what so far amounts to $4 billion spent by the company on real estate here will be long-lasting, he said: “These buildings will stand for hundreds of years.”
While company campuses may be larger and more dominant in some suburbs —Microsoft in Redmond, Wash., or Apple, Google and Facebook in Silicon Valley — in big cities, corporate tenancy is generally fragmented.
For example, financial giant Citi has 3.7 million square feet in New York — making it the second-largest major-city office tenant in absolute terms after Amazon. But it represents less than 3 percent of Class A office space in the Big Apple.
That’s typical: In most big cities, the top employer has less than 5 percent of local office space.
In Seattle itself, Amazon is in a league of its own. Its presence is nearly 20 times greater than that of the next-biggest employer.
Amazon has become the go-to scapegoat for people complaining about Seattle’s problems associated with growth, like housing prices and clogged streets. And while it’s certainly not the only reason Seattle is bursting at the seams, Amazon makes up a disproportionate share of the city’s rapid growth.
Apartment rents this year are 63 percent higher than in 2010, as Seattle has become the fastest-growing city in the country.
Home costs are rising faster here than anywhere else in the nation, and have doubled in the past five years, pushing the middle class to surrounding, less expensive towns.
Seattle now also has the nation’s third-highest concentration of commuters who travel at least 90 minutes each way to work. Their numbers have grown 72 percent in five years.
Buses are more packed than ever, and lines that run along the Amazon campus are often standing-room-only during rush hour; Metro drivers at times have to leave commuters waiting outside an Amazon office because their buses are full. Local officials added buses to accommodate the crush of Amazon interns that arrived this summer.
“It’s hard to keep pace in terms of development of infrastructure,” said Simon Stevenson, the director of the Runstad Center for Real Estate Studies at the University of Washington. But overall, “the positives, economically, outweigh the potential of the downside.”
Wages here are rising faster than anywhere else in the country, driven by Amazon’s hiring binge of employees making six figures. Unemployment is near a record low.
Amazon has begun turning around the reputation that it’s done little to alleviate the problems stemming from Seattle’s growth. The company recently said it would house a homeless shelter in one of its new offices and is offering nonprofits space for restaurants in some of its other buildings. It gave $10 million to the University of Washington last fall, created plazas for public use and has helped underwrite the South Lake Union streetcar.