The company said on Wednesday that it would not move into more than 700,000 square feet in a skyscraper under construction in its home town.
Amazon, led by founder Jeff Bezos, had agreed in 2017 to rent all 30 floors of office space — with room for at least 3,500 employees — in Rainier Square, which will become the second-tallest building in the Pacific Northwest when it opens next year, according to The Seattle Times.
The project became a point of tension in May, however, when Amazon clashed with Seattle’s city council over a tax on top employers to fund affordable housing and homeless services.
Amazon suspended construction work in the city and warned it might sublease rather than occupy the Rainier Square space, saying the tax “forces us to question our growth here”. Amid pressure from Amazon and other large Seattle companies, the council repealed the tax and Amazon resumed its construction projects.
The company on Wednesday said: “We are always evaluating our space requirements and intend to sublease Rainier Square based on current plans. We have more than 9,000 open roles in Seattle and will continue to evaluate future growth.” Amazon declined to disclose the duration of its Rainier Square lease.
It added that it is currently building 2m square feet of office space in the city.
The decision is another indication that Amazon’s long period of rapid growth in Seattle is drawing to a close. The company has fuelled economic expansion, job creation and development as it has grown to employ more than 45,000 people and occupy about 40 buildings in the northwestern US city.
But Amazon has also come under pressure over its perceived role in driving up the cost of living, as real estate prices and rents have also ballooned.
A desire to diversify its corporate footprint and tap new talent pools was the driving force behind the public search Amazon launched in 2017 for a second headquarters that would house 50,000 workers. After more than a year of evaluating candidates across North America, the company announced in November it would split the project between Arlington, Virginia and the Long Island City neighbourhood of Queens, New York.
However, Amazon withdrew its New York plans earlier this month following a vocal backlash from local elected officials and community activists over the financial incentives the state had offered and the potential impact on local residents, housing prices and public transport. The company said it would spread the 25,000 jobs it had planned to bring to New York City over 17 existing North American offices.