In January 2018, Amazon shortlisted 20 different finalists for its coveted second North American headquarters dubbed “HQ2”. Comprised of 19 American cities and one Canadian. The list incorporated an assortment of metropolitan areas, ranging from enduring primary markets like Chicago and Los Angeles to riskier, up-and-coming tertiary markets like Pittsburgh and Raleigh. Despite differences in socio-economics and demographics, all were eager to reap the benefits Amazon’s $5 billion investment promised to bring.

We all know how the story ended: Amazon announced its winners in November 2018, deciding they would split HQ2 into two separate locations–one in Long Island City, New York and the other in Crystal City, Virginia.

Now, nearly six months after the decision was declared (and controversially rescinded by Long Island City), how are the other contenders holding up? Some markets are still thriving. Boston and Miami, specifically, have seen an uptick in the percent of total commercial assets that have sold throughout Q1 2019.

For most of the metros, however, investment has stalled. Certainly, not all of the cities were growing just from making Amazon’s radar; areas like Austin and Denver have steadily been hotbeds for investment over the past few years. According to Reonomy data, however, transaction volume in some of these same metros has actually slowed since losing out on HQ2.

Is it possible the rate of growth in these cities will stall ever so slightly without the incentive? Or is it too soon to tell? Below, we explore how five of the contenders for HQ2 are managing without the tech giant, based on the percent of the total supply sold in the last two years.

1. Denver, Colorado 

Denver was a strong contender for the new HQ from the getgo. Factors like accessibility, business growth, and talent pool definitely made Denver an attractive option for Amazon, but apparently, they weren’t enough.

Since Amazon’s decision, sales have stalled in the Mile High City. From Q1-Q3 2018, the percent of total asset supply sold remained higher than the year before. However, these numbers started to taper off in Q4, and continued to decline throughout the new year.

Interestingly, the decline appears to be affecting asset classes traditionally strong for Denver’s market, like multifamily and vacant land. Research shows vacancy rates across Denver, Boulder and Aurora have increased while overall transaction activity has decreased since the start of 2019. Reonomy data indicates that H1 2019 multifamily sales have actually decreased by 44.1% compared to the year before, supporting this downward trend.

Is Denver’s decline contingent on Amazon’s decision? Or are the other economic factors, like population growth and business expansion, that could be playing into the metro’s performance? CRE professionals should pay close attention in the coming months.

2. Boston, Massachusetts

With an influx of startups opening up digs in Boston, it’s no wonder the city was a finalist in the running for HQ2. But regardless of losing, Beantown appears to still be booming. Reonomy data indicates that the percentage of commercial assets sold in Boston has steadily inclined over the past two years. From Q1 2017 to Q2 2019, the percent sold of Boston’s total commercial supply more than doubled (0.35% to 0.71%), proving Boston’s appeal.

What’s sold, specifically? From January through March 2019, nearly 69 percent of all sales transactions were multifamily-related, dominating Q1 sales. This shouldn’t come as a surprise–according to the most recent census results, Boston’s population has seen consistent growth over the past nine years (up seven percent since 2010), certainly contributing to the spike in transaction activity.

Industrial sales are flowing, too. Reonomy data confirms that H1 2019 industrial sales, which incorporate all warehouse and storage buildings, are up 44.7% compared to H1 2018. While Amazon may have passed on Boston’s potential, it’s clear other companies and investors are keen–should this interest continue through the second half of the year, Boston will soar without the tech giant in its backyard.

3. Miami, Florida

Transaction volume in Miami appears to be slowing down since Amazon’s announcement. While 2018 rounded off strong, and the momentum continued through Q1 2019, sales have steadily declined throughout Q2; Reonomy data indicates the percentage of total assets sold in Q2 2019 sales decreased 15.5% (1.81% to 1.53%) from the quarter prior.

Was Amazon’s presence that much of a force in South Florida? Potentially, but that’s not to say the city’s transactional future will be dismal. Economic factors and business incentives throughout Miami-Dade County are still attractive to investors. While the percent of total asset supply dipped, certain sub-sectors have held strong. Vacant land has performed particularly well, accounting for more than 20% of Miami’s 2019 sales in H1. Reonomy data also shows multifamily isn’t that far behind, accounting for 19.2% of H1’s sales and up 1.49% compared to H1 2018.

Whether or not Miami’s market impacted by Amazon’s denial will take time to analyze, but in the meantime, certain sub-markets are holding strong.

4. Austin, Texas 

Has Austin’s ascent finally reached its peak? Ever since Amazon’s announcement, the percent of total asset supply sold has steadily declined. While 2018 transaction activity grew steadily over the course of the year, sales volumes dipped slightly after the start of 2019. In fact, Reonomy data indicates that Austin’s H1 2019 sales were down 68.8% compared to the first half of the year in 2018.

Amazon aside, Austin’s growth was predicted to lag behind 2018. After rapid expansion over the past decade and such a strong previous year, market reports estimated the city would have a tough time matching momentum in 2019.

What asset classes have pumped the brakes? General commercial sales, which includes sub-sectors like retail, office and mixed-use, have slowed from quarters past. Comparatively, H1 2018 commercial sales outperformed 2019 commercial sales by 35.7%. Land sales are down, as well, signifying development in Austin might be stalling. However, the percent of total parcels sold have been gradually descending since Q2 of 2018 (down almost 20 percent year-over-year), indicating Amazon’s choice might not have played a part in its descent.

5. Indianapolis, Indiana

Finally, Indianapolis’s midwestern hospitality and reasonable cost of living landed it on Amazon’s list of potential new homes. While significantly less bustling than other contenders like NYC and Chicago, Indy promised access to university talent, affordability, and “live, work and play” appeal for the company’s future workforce.

Despite these incentives, Amazon ultimately passed on an HQ2 in the heartland, and its possible transaction activity has been affected by its choice.

While the percent of assets sold steadily increased throughout most of 2018, deal flow took a turn through the first two quarters in 2019. According to Reonomy data, Indy’s total H1 2019 sales are down 30.8% from the previous year, signifying a decline in interest around the Crossroads of America. It’s possible Amazon’s impact was substantial, or Indy is experiencing other fiscal factors, like a generally slowing economy. After a slow start to 2019, it will be a waiting game for Q3 and Q4 transaction results, which will help to gauge HQ2’s residual effects better.

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