Amazon seems to be leaving hints that it is close to choosing the Washington, D.C. metro area for its “HQ2” — the company’s second headquarters — bringing tens of thousands of people and jobs to the region.
In Northern Virginia, Amazon executives have toured locations in Alexandria (near the Eisenhower Metro station and near North Potomac Yard), Arlington and Loudoun County.
If Amazon chooses the D.C. metro area for its headquarters, many new and relocating Amazon employees will need homes, and the way it affects the local housing market will depend on where HQ2 lands.
"HQ2 will affect the natural laws of supply and demand in a market already experiencing low inventory,” said Elizabeth Lucchesi, a Realtor with Long & Foster. “Additional demand will create an even tighter supply and could increase home sale prices."
Brittany Patterson, vice president of The Patterson Group at TTR Sothebys, agreed. “The Amazon effect, as it’s now coined, would be readily apparent in Northern Virginia and, specifically, Alexandria real estate. Neighborhoods near the metro and within a one-hour commute would see an increase in home values as 50,000 ‘high-paid’ employees secured housing,” she said.
Alexandria has 22 percent less inventory (homes for sale) than it did a year ago, according to local market data, and prices are up 8 percent from a year ago.
“With Amazon’s 50,000 employees descending on the DMV, we could potentially see an average increase of sales price by 10 to 20 percent. We could also see a housing shortage, at least in the short term while housing is secured,” Patterson noted.
There is no estimate on how many Amazon employees would move here and how many could be hired locally.
The Eisenhower East area surrounding the Eisenhower Metro station is already undergoing significant redevelopment, with dozens of new condo buildings, townhomes, apartments and office space projects underway.
The long-term vision for this area is “mixed-use, high-density development that takes full advantage of the transit infrastructure and the ability to construct very tall structures,” according to the Alexandria Economic Development Partnership. A new Wegman’s is going into this neighborhood (estimated delivery 2021). A Pump It Up kids playspace opened in this area in August 2018. Toll Bros. recently built more than 65 homes starting in the $900,000’s located just west of the Telegraph Road bridge on Eisenhower Avenue.
The North Potomac Yard area is also slated for redevelopment. Thousands of homes have been built in anticipation of a new Metro station at Potomac Yard. The area that now includes Shoppers, Barnes & Noble, Regal Cinemas and more could see 7.5 million square feet of new office, retail and residential space.
Both areas are close (or will be close) to Metro stations — a key feature for Amazon. "HQ2 guidelines require the location to be near public transportation. This can only bring prosperity to the area,” Lucchesi said.
An Arlington location, such as near Rosslyn, could still mean a boost to Alexandria real estate. If Amazon chooses Loudoun County, somewhere in the District or Maryland, the effect will be far less on Alexandria’s housing market.
In late July, Washington Business Journals reported Amazon had a job listing for an economic development manager in the Washington, D.C. metro area. The listing set off a new frenzy of speculation about the location of HQ2.
Amazon officials have said they plan to make an announcement on the final selection for HQ2 later this year, with rumors of a shortened list coming within a few weeks.
Regardless of location, some residents are wary of a huge company putting down roots here, increasing the area’s population, demand on schools and public services, and traffic.
"The arrival of large corporations to an area is accompanied by a palpable fear from the current residents,” noted Lucchesi. “Let's turn that fear around and celebrate the huge benefits these corporations bring - philanthropic contributions and an increased tax base. Bigger entities have activated the Alexandria area. Take a look at how The Wharf and MGM broaden Alexandria — people have options and it's fabulous for the marketplace."
