What has a giant port and tons of coders? Mayor sells L.A. for Amazon’s HQ2

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(Bloomberg) -- Amazon.com Inc.’s rapid growth has made the company a scapegoat for soaring housing costs in its hometown of Seattle. As the tech giant picks a location for its second North American headquarters, which could eventually employ 50,000 people, it’s determined to avoid a repeat.

That’s a selling point for Los Angeles, one of the 20 places still in the running for HQ2, according to Mayor Eric Garcetti.

“We can absorb those many jobs without being blamed for high rents,” he said in an interview with Bloomberg.

While Los Angeles is certainly a bigger city than some of the other contenders -- like Indianapolis and Austin, Texas, where an influx of tens of thousands of workers might be more noticeable -- it also has one of the tightest housing markets in the country. The data provider Zillow estimated in April that the city would see some of the steepest increases in rents of the group if Amazon came to town, based on how the various locations responded to recent additions of workers.

As the only remaining contender on the West Coast, L.A. may not get the nod from a company that’s looking to expand its geographic reach.

Garcetti said Los Angeles could still be a “really logical choice” for Amazon. He ticked off the advantages: The city has a major port, which could be appealing to a company that thinks a lot about logistics. A “flat, dense city” could be a good place to test out delivery of packages by drones. L.A.’s entertainment industry produces the content that helps Amazon convince people to pay for its Prime membership program. And, Garcetti said, Los Angeles graduates more engineers than any other U.S. city.

--With assistance from Christopher Palmeri

Bloomberg News