Business Columns & Blogs

Forget Amazon. Seattle is ripe for poaching many smaller businesses

Where might a Seattle-based company looking for affordable office or light-industrial space consider moving? How about Tacoma?
Where might a Seattle-based company looking for affordable office or light-industrial space consider moving? How about Tacoma? THE NEWS TRIBUNE

Amazon says it received 238 applications for its second headquarters from states, provinces, districts and territories. So, assuming no geographic overlap among those submittals, that means 237 disappointed governmental and economic-development entities sometime next year.

The Puget Sound area cities and counties that submitted applications are likely to be among the 237 unhappy with the outcome, unless Amazon has been misleading about its motivation for establishing a second headquarters equivalent to its present corporate abode in Seattle.

Putting HQ2 within a day’s drive of HQ1 – and sometimes it seems like a day is what it takes to get around here – would seem to contradict what Amazon hopes to accomplish (although most of that is based on conjecture; the company has been a bit coy on the subject.)

But there will be time enough to parse the outcome and reverse-engineer what priorities and requests were most important when the decision is made — if one is made (Amazon could choose to distribute a few consolation prizes to runners-up.)

In the meantime, there’s a golden economic-development opportunity awaiting just up the road, one with no connection to Amazon.

Seattle is holding municipal elections this year; at the top of the ticket is a contest to choose the latest in a succession of mayors who voters will tire of and want gone in four years. Paul Schell, Greg Nickels, Mike McGinn and Ed Murray were chased from office; all but Nickels lasted just one term, and Murray didn’t last even that long.

The dispiriting choice of the two finalists offered voters this year does not inspire much confidence for a more productive four years, whoever wins.

Then there’s the election for Seattle’s rambunctious city council, and a slate of candidates unlikely to dampen that body’s enthusiasm for more taxes, fees, regulation and social engineering.

For example: Council members Mike O’Brien and Kirsten Harris-Talley (neither on the ballot this cycle; Harris-Talley is an interim appointee) have proposed a per-employee tax of 4.8 cents per hour on the top 10 percent of businesses as ranked by revenues.

It’s not just the tax itself. It’s not just the tendency for those brackets to expand to capture more businesses (a phenomenon that has politically sunk “it’s just for the rich” income-tax proposals in this state). It’s not just the parade of tax increases already imposed. It’s not just the likelihood of more proposals to come (How about congestion pricing for using Seattle’s city streets? That idea too has been floated.) It’s not just the dubious efficiency and effectiveness of spending, past, present and future, on programs for the homeless.

It’s all of those together, and more, that has a lot of businesses looking at the cost of operating in Seattle and wondering about the return on their investment of time, effort and money by doing so.

There’s where Seattle’s pending misfortune is everyone else’s opportunity.

The per-employee tax is aimed at the biggest companies in Seattle, and certainly the Amazons of the world make for inviting recruitment targets. But that’s not where the opportunity lies.

Below the cluster of the biggest, highest-profile companies — and it’s not just tech, banks and hospitals — is a huge cluster of companies that not only don’t need to be in Seattle but also would benefit by being elsewhere.

Want office or light-industrial space you can afford? We think we know where some of that can be found. Need to be close to the port? Got it covered. Closer to the airport? That too. (Don’t think the counties north of King won’t be making a similar pitch when Paine Field in Everett starts offering commercial flights.) Want your employees to be able to afford homes and apartments and still have reasonable commutes? We can make that work.

Want to operate where traffic still moves? Well … we’re working on that. (See: Interstate 5, and closing the gap between the Valley Freeway and the port.) Want to be where government isn’t sizing you up for more money to shake out of? Let’s talk.

The more nimble and adept economic development entities are already combing through lists of small and mid-sized companies in Seattle and making discrete pitches to businesses about relocating.

Should Seattle catch wind of these efforts and care enough to complain about poaching, the effort can always be couched as being to Seattle’s benefit — “See, we’re doing you a favor taking some of the growth you’re always complaining about.”

Landing companies of 100 or 200 workers, or even smaller, is a strategy better suited, and likely more successful, for non-Seattle communities in this region than trying to land, and swallow a Great White Whale prospect on the order of Amazon.

Of course, if Amazon decides it can accomplish what it wants in Tacoma or vicinity, those towns probably wouldn’t say no to that opportunity either.

Bill Virgin is editor and publisher of Washington Manufacturing Alert and Pacific Northwest Rail News. He can be reached at