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Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

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Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#151

Post by throwaway2048 »

whatok wrote: post #113
leroy_masochist wrote: post #103

> The livability crisis that’s currently afflicting Seattle and San Francisco is evidence of how cities need to be careful what they wish for when it comes to the explosive growth of technology companies (and the attendant wealth that comes with it) in their metropolises. Let me get this straight, New Yorkers should view Seattle and SF as cautionary tales for what happens when high-paying jobs arrive in a metropolita…

New York definitely has an affordable housing issue but a vast over supply of luxury housing (a lot still going up to) that I'd imagine a good portion of these hires would be taking up.

Its a great example of how just building more housing isn't a complete solution, because all builders are going to target the top of the market if they at all can.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#152

Post by metalliqaz »

Eridrus wrote: post #137
thfuran wrote: post #96

Earlier quoted context omitted.

So if the subsidy were 95% of expected revenue, would you still support it because hey, 5% is 5%?

If the 5% were a true accounting of all the costs involved, yes. When it's 90% you can get away without an accurate accounting since the margins are so huge.

An accounting with that accuracy just isn't possible. The OP was touching on the vast and varied social costs that are leveraged to build value for the shareholders.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#153

Post by whatok »

dingaling wrote: post #144
at-fates-hands wrote: post #105

Earlier quoted context omitted.

> I'd have had a lot of respect for Amazon had they just chosen a site on logistical criteria and built it out of pocket. Amazon is a publicly traded company. Like every company, the point of the business is to generate profit. This means reducing overhead costs in order to do so. Sure, they could do it out of pocket, but why do that when NY was offering standard business incentives to bring them there? Why cost your…

Amazon doesn't pay dividends, so the magnitude of profit has no direct relevance to shareholders. So if it won't harm the shareholders ( most of whom are secondary-market holders and thus not investors ) why not what is morally right versus technically right? Isn't that what we ask engineers to consider before working for ad networks, for example? Why does that not scale to companies?

Whether a company pays a dividend or not has no relevance to whether profit should matter to an investor. I'm not sure what you're trying to make a point about here. Additionally, I'm not sure what your point about "secondary market holders" vs "investors" is about either. Would you mind clarifying these?

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#154

Post by throwaway2048 »

downandout wrote: post #150
minikites wrote: post #102

Earlier quoted context omitted.

It's interesting that you use retail coupons as an analogy. Are you familiar with the idea of a loss leader? What happens if that revenue isn't earned elsewhere? It's not at all clear that New York would come out ahead on this deal, given the infrastructure costs and Amazon's well known tendency to avoid paying taxes.

I am familiar with the concept of a loss leader, but that has nothing to do with what was happening here. Giving someone a discount on taxes doesn’t mean they don’t pay taxes, or, as your original comment and the tweet you linked to implied, that they were simply handing Amazon $3 billion in cash that was sitting in the bank and can now be diverted to random government projects designed to invent jobs. The $3 billion…

It effectively reduces to the same thing if amazon's presence means that other businesses in the same sector/local area aren't don't exist.

There is no shortage of business and people in the sectors Amazon is a part of in NYC, and coming to NYC.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#155

Post by thrownaway954 »

leroy_masochist wrote: post #103

> The livability crisis that’s currently afflicting Seattle and San Francisco is evidence of how cities need to be careful what they wish for when it comes to the explosive growth of technology companies (and the attendant wealth that comes with it) in their metropolises. Let me get this straight, New Yorkers should view Seattle and SF as cautionary tales for what happens when high-paying jobs arrive in a metropolita…

A high paying job doesn't mean alot when a pack of cigarettes are $15 and rent is $4K a month. The issue with NY is the HIGH cost of living. You can only eat $1 slice pizza for so long.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#156

Post by NickM »

sys_64738 wrote: post #65
whack wrote: post #54

Earlier quoted context omitted.

I keep hearing about Amazon getting "special treatment", but is that really true? https://www.marketwatch.com/story/what-amazons-hq2-means-for... > For the Long Island City location, Amazon was going to receive $1.2 billion in refundable tax credits through New York State’s Excelsior Jobs Program if the company created 25,000 net new jobs in New York State by the end of June 2028. > New York State had also promised a…

It doesn't matter how much money Amazon got as it's the perception of the fact they are getting a tax break which is why it's shocking. Amazon isn't some two-bit startup which has no VC funding. It's the richest company in the world so why the heck do New Yorkers need to hand over their cash to bring them the Queens?

It's the richest company in the world so why the heck do New Yorkers need to hand over their cash to bring them the Queens?

Because Amazon can easily go elsewhere, and most places have lower taxes than NYC. Giving them a ~10% off coupon on an extremely high tax rate is not the same as handing them money.

You can object to the deal on principle, sure, but you're ignoring the fundamental reality of the situation; if NY refuses to give them any incentives, they can just as easily go to some other location that will give them incentives. And if all the states banded together and agreed that nobody would give them incentives, NY still loses, because then they'll just pick a place with lower tax rates.

I can understand the appeal of trying to stand up to big corporations, but in the end, NY isn't screwing Amazon by refusing to negotiate with them on this, they're just screwing themselves. If you want to have high tax rates and not lose business to other states, it's a winning strategy to be open to compromise sometimes.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#157

Post by [deleted] »

thrownaway954 wrote: post #155
leroy_masochist wrote: post #103

> The livability crisis that’s currently afflicting Seattle and San Francisco is evidence of how cities need to be careful what they wish for when it comes to the explosive growth of technology companies (and the attendant wealth that comes with it) in their metropolises. Let me get this straight, New Yorkers should view Seattle and SF as cautionary tales for what happens when high-paying jobs arrive in a metropolita…

A high paying job doesn't mean alot when a pack of cigarettes are $15 and rent is $4K a month. The issue with NY is the HIGH cost of living. You can only eat $1 slice pizza for so long.

[deleted]

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#158

Post by tfehring »

whatok wrote: post #140
tfehring wrote: post #138

Earlier quoted context omitted.

In what sense is there an oversupply of luxury housing? Are there lots of vacant luxury units?

There are a lot of vacancies and nearly unheard of concessions being thrown out there. A ridiculous amount of construction as well. If there's prolonged weakness, concessions eventually turn into rent decreases. https://ny.curbed.com/2018/4/12/17227574/new-york-rent-marke...

All of that seems good and necessary - given that the median net effective rent is still over $3k/month in Manhattan, and that there's apparently room to profitably continue building, it sounds like things are headed in the right direction.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#159

Post by manfredo »

throwaway2048 wrote: post #151
whatok wrote: post #113

Earlier quoted context omitted.

New York definitely has an affordable housing issue but a vast over supply of luxury housing (a lot still going up to) that I'd imagine a good portion of these hires would be taking up.

Its a great example of how just building more housing isn't a complete solution, because all builders are going to target the top of the market if they at all can.

No. The price of housing is not determined by the builder. Like any good its price is driven by what people are willing to pay. Here in SF, even 230 square foot studios are considered "luxury housing" because the shortage of housing is that extreme. Any new construction commands a premium over old housing. In effect, restrictions on building more "luxury housing" restricts the construction of most new housing even if it is high density.

Building more housing, and giving incentives to build as much housing as possible is indeed a complete solution.

Re: Did New York Lose Anything with Amazon’s Rejection? It’s Complicated

#160

Post by briandear »

throwaway2048 wrote: post #151
whatok wrote: post #113

Earlier quoted context omitted.

New York definitely has an affordable housing issue but a vast over supply of luxury housing (a lot still going up to) that I'd imagine a good portion of these hires would be taking up.

Its a great example of how just building more housing isn't a complete solution, because all builders are going to target the top of the market if they at all can.

They target the top because the regulatory environment is such that it’s too costly to target middle and lower range properties. In places like Houston, there are tons of “normal” places being built. With land prices in places like New York and requirements to subsidize “affordable” units within the building, that necessarily means the market rate apartments have to be much more expensive to compensate. In Houston, there is no such thing as “affordable” set-asides because their isn’t a need for it. Houston also doesn’t set aside thousands of acres of prime land as “open space preserves” like they do in the Bay Area, further constricting available land. We can debate the quality of life value of “open space;” it would be a fair debate, but you can’t have lots of available but politically unbuildable land while simultaneously lamenting the lack of affordable housing.
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