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· Posted on
February 21, 2024

Amazon puts a pause on HQ 2.0 'coz after all its layoffs, its new building could become a ghost town

Amazon has announced it plans to pause a large part of its construction project.

What's the key learning?

  • Amazon is putting a pause on the large part of construction of its brand new HQ2.
  • In a post-pandemic world, where many Amazonians work from home and another 28,000 have been laid off, Amazon isn't sure it still requires the same real estate it once imagined.
  • Amazon’s HQ2, and its approach to office real estate, is representative of where the tech industry was and where the tech industry is now.

👉 Background: In 2017, Amazon announced it was looking for a brand new HQ2. It promised to add 50,000 new jobs and invest over $5 billion USD in construction to a new city, outside its hometown Seattle.

👉 What happened: The winner was... Virginia. But now, Amazon has announced it plans to pause a large part of the construction project.

👉 What else: In a post-pandemic world, where many Amazonians work from home and another 28,000 have been laid off, Amazon isn't sure it still requires the same real estate it once imagined.

What's the key learning?

💡 Amazon’s HQ2, and its approach to office real estate, is representative of where the tech industry was and where the tech industry is now. And just how different they are.

💡 During the peak of lockdowns, almost all workers were forced to work from home. But now, with lockdowns just a relic of the past, tech workers are still spending at least part of the time working from home.

💡 With the combination of less-aggressive expansion plans and employees still working from home, companies have been able to reduce real estate costs

  • Google recently backed out of a large new office in Seattle after it laid off staff
  • Microsoft has delayed an overhaul of its headquarter campus too

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