Breaking Down Toronto’s 190-Page Amazon HQ2 Bid

Amazon’s deadline for cities to bid for the company’s new HQ2 came and went on October 19 and multiple Canadian cities reportedly submitted proposals.

Edmonton, Vancouver, Ottawa (in partnership with Gatineau) and Halifax are among those who are vying for Amazon’s 50,000 new high-paying jobs and billions in revenue. Toronto is also on that list, and they released their 190-page bid (PDF) to the public for anyone to peruse and—hopefully, in the city’s eyes—feel a little intimidated by.

Toronto’s bid opens with a few heartfelt letters, the first of which is penned by Mark Cohon and Toby Lennox. The two are the chairman and CEO respectively of Toronto Global, an organization founded to encourage companies and entrepreneurs to set up shop in Canada’s largest city.

The next letters came from Prime Minister Justin Trudeau and Ontario Premier Kathleen Wynne.

“As Amazon decides on the location for its second North American headquarters, I am certain that Canada will stand out,” writes Trudeau. “With all our advantages and a government that is willing to invest in the future, the business case is simple.”

The bid is separated into five different sections: talent, business climate, quality of life, transportation and infrastructure, and possible sites for the HQ2 itself. This all combines to create a sort-of love letter to Toronto and the businesses and citizens within the city.

Talent

Talent is the first section, and rightly so, as the province of Ontario has done a lot lately to promote the strength of its current and upcoming workforce. Premier Wynne’s business advisor Ed Clark discussed the province’s bids the day before they were due and said himself that the “core of the province’s commitment is all about talent.” After all, the Toronto region is home to 7.8 million people (this includes Hamilton, Kitchener-Waterloo, and the Guelph, York and Durham regions) and sits as the fourth-largest in North America.

“We develop, attract and retain local and international talent like no other location on the continent. Why? Because we build doors, not walls,” reads the bid. “We have the most highly-educated workforce in the OECD. We are also being far-sighted by placing the highest priority on future proofing our talent.”

The future proofing the bid refers to comes in a few forms. Firstly, Ontario has committed to graduating 25 per cent more STEM graduates per year, from 40,000 to 50,000, while also injecting $30 million into the Vector Institute in order to produce 1,000 more grads in AI-related fields per year.

A constantly growing population is also highlighted, as Toronto has added 433,537 people over the past five years, second in North America behind Dallas. Immigration is also touted as a huge positive for Amazon to move to Toronto, with the city’s percentage of foreign-born residents almost 10 per cent higher than any other city in the continent.

“Canada is committed to working hand in glove with Ontario to meet Amazon’s talent needs through temporary and permanent resident pathways now and into the future,” said Ahmed Hussen, Canada’s Minister of Immigration.

A “volume” argument is being made as well, due to Toronto’s status as the third largest tech hub in North America and growing, adding 22,500 tech jobs in the last year—double that of New York City. The quality of education is also on display, with several graphs and numbers focusing on specialized degrees as well as post-secondary enrolment and conferment.

A particular focus is placed on the University of Waterloo and the University of Toronto, two of Canada’s top schools and two of the best schools in the world. U of T is a hotbed for AI research and the University of Waterloo has been called the Stanford of the north.

Business Climate

“Our business case for Amazon is strong. We offer highly competitive advantages that make it cost-effective to be here instead of anywhere else,” reads the bid. “Amazon can access our talent at a fraction of the wage cost compared to any other top tech market in North America.”

That “fraction of a wage cost” was put into perspective by Ed Clark during his presentation about Toronto’s bid. By virtue of Canada’s single-payer healthcare system, currency rates, and lowered tech wages, Amazon could stand to save almost $1.5 billion a year compared to moving to a location in the U.S.

Using those metrics, the operating cost for a business is around 26 per cent lower in Toronto than other tech markets, and income tax rates 12.4 per cent lower than the U.S. average. Five median salaries are listed as well for accounting, management, legal, engineering and administration, all woefully lower than their U.S. counterparts.

A few incentives are also listed, though the government is strict on the fact that they will not provide any kind of tax breaks for Amazon. The incentives are merely programs or grants available to any Canadian business that Amazon would be a fit for, like the Strategic Innovation Fund or the Jobs and Prosperity Fund.

A few key industries are also outlined, showing how Toronto is home to both home-grown and international innovation. AI, quantum computing, cybersecurity and more are described in detail, with examples given for each.

If all that wasn’t enough, there’s even a small section that promises dedicated space in Toronto’s Union Station for Canada’s first ever Amazon Go store, which is a hub without cashiers where everything is processed through a mobile device.

Quality of Life

The true ode to Toronto shines through here, as the bid tries its best to sell Toronto as a cool, hip city with simultaneously nothing and everything to prove.

“Our unparalleled quality of life underpins the Region’s attractiveness to homegrown and international talent,” the bid reads. “From the bustle of the urban core to the sprawling countryside and everything in between, the Toronto Region offers something for everyone.”

The first tidbits all revolve around crime and safety, showing that Toronto is a substantially safer city than Seattle, the current home of Amazon’s first headquarters. Perhaps to draw on the recent tragedies in the Southern U.S., there is even a quote from the New York Times describing how Toronto is not at risk to rising sea levels or water shortages.

Housing, a major concern for many in Toronto already, is skimmed over a little bit, with only four picture-heavy pages dedicated to tackling the issue. All the city does is try to beat out Seattle and San Francisco, two of the only cities that may be in rougher shape than Toronto when it comes to housing infrastructure.

Finally, there is a large section devoted to what makes Toronto fun. Sporting teams that are actually beginning to win, film festivals, PRIDE and more are all highlighted.

Transport and Infrastructure

Transit is a key component to where Amazon will locate their next HQ. It will be impossible to have 50,000 people all drive to work, so a robust system must be in place, and Toronto does their best to highlight how the city is growing their efforts.

Toronto makes its transit score of 78 (out of 100) clear, third highest in North America only behind San Francisco and New York City. There is a small write-up on each way to travel publically in the city, including Go Transit, Toronto Transit Commission (TTC), MiWay and York Region Transit.

The city also touts how Walkscore dubbed the city a “walker’s paradise” and that 4.6 per cent of inhabitants walk to work. This is listed right before a graph detailing how Toronto has the fourth-worst commute time for drivers in North America.

Flying is a big aspect of the bid too, as Torontonians have access to over 130 million people within a 500-mile radius. It is possible to fly to New York City, Washington, Chicago, Boston and more all within 90 minutes, leaving from Pearson or Billy Bishop airports.

The Site

There are 10 different locations that are listed for a potential Amazon HQ2 site, but the bid goes into the most detail on a space in the Toronto core.

“This is the place for any company looking to tap into the potential of a truly global marketplace and a stable, innovative, forward-looking economy,” said Toronto Mayor John Tory.

The bid describes existing vacant office space that could be put together to form a campus similar to what Amazon has in Seattle. Conversely, there is 18 million square feet of space to be completed between 2019 and 2026 or 42 million square feet of undeveloped land ripe for the picking.

Sites like 150 King West, 100 University Avenue, the Richmond-Adelaide Centre and more are all spaced and priced out. These total a combined 1.3 million square feet, with future opportunities bringing more than 40 million more square feet, mostly in the east harbour and the Port Lands. Initially, Amazon will require 500,000 square feet, ballooning to eight million by the end of their HQ2 expansion in 2027.

A few proposed developments are also outlined, such as CIBC Square’s 2.7 million square feet and 16 York Street’s 879,000 square feet. The most forward-thinking of the proposed spots is the east harbour, with 11 million square feet of office space along with a new subway and Go transit station as well.

Looking to the Future

As Amazon settles down to read through the multitude of bids they have received, each city will hope they stand out. Toronto has done their best, placing a huge emphasis on talent, healthcare and not being in the U.S.

Still though, Ed Clark most likely hit the nail on head as he finished his address regarding Toronto’s bid.

“The question you have to ask is: Does politics factor into it?” said Clark. ”If it does, and [Amazon CEO Jeff Bezos] doesn’t want to say ‘President Trump, I’m moving 50,000 jobs to Ontario,’ then we don’t get it.”

“If not, we are hands down the winner.”

Amazon will make their decision sometime in 2018.