Virginia Second Headquarters Construction Paused By Amazon

Amazon has informed Trade Algo that it will be halting development on its HQ2 facility in Virginia.

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The groundbreaking of PenPlace, the second phase of the vast campus in northern Virginia, has been delayed, according to John Schoettler, Amazon's head of real estate. This June, the Metropolitan Park portion of the site, which will house 8,000 workers, is anticipated to open on schedule.

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The move coincides with actions taken by Amazon CEO Andy Jassy to reduce costs across the organization in response to declining sales and a bleak economic outlook. Because of this, the business has announced the greatest round of layoffs in its history, affecting more than 18,000 workers. Also, Amazon is reviewing its real estate portfolio and retiring some of the projects.

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Met Park will have space to accommodate more than 14,000 employees, so we've decided to postpone the groundbreaking of PenPlace (the second phase of HQ2) a little bit, Schoettler said in a statement. "We're always evaluating space plans to make sure they fit our business needs and to create a great experience for employees," Schoettler said.We have always planned to build our second headquarters over a number of years, and we are still dedicated to Arlington, Virginia, and the larger Capital Region.

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PenPlace is a mixed-use development that includes three 22-story office buildings, more than 100,000 square feet of retail space, and a 350-foot-tall tower called "The Helix." The development is larger than Metropolitan Park, which is located south of PenPlace and consists of two additional 22-story office towers, as well as a mixed-use site with retail, restaurants, and green spaces.

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In addition to the Queens, New York area of Long Island City, Arlington was chosen by Amazon as the location of HQ2 as part of a highly publicized, flashy hunt for a second headquarters that began in 2017. In response to opposition from neighborhood activists and city council leaders, the firm declared in 2019 that it would abandon plans to construct its new headquarters in New York.

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During the pandemic, the company quickly increased both the number of employees and its physical footprint as a result of an increase in internet sales. Yet in recent months, it has scaled back on office development and the building of new structures in Nashville, Tennessee, and Bellevue, Washington, citing uncertainty regarding the impact of the epidemic on in-office business, according to Trade Algo.

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Jassy said earlier this month that starting on May 1, Amazon would make corporate employees work at least three days per week. This decision drew criticism from some workers, who said they would prefer a more flexible approach to return-to-office schedules.

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According to Amazon, HQ2 and the surrounding area will add about 25,000 employment over the course of the next ten years. That pledge, according to Amazon spokesperson Zach Goldsztejn, is unchanging.

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According to Goldsztejn, the business anticipates starting pre-construction work on other HQ2 components later this year.