Amazon freezes construction of second headquarters in Virginia amid job cuts

After laying off 18,000 workers, the company said the delay was tied to remote work needs.

Kevin Lamarque / reuters

Amazon is pausing construction on its second headquarters in Arlington, VA. The company tied the decision to “a reassessment of office needs to account for remote work,” although the move came months after the retailer laid off around 18,000 workers.

The online retailer confirmed the move to Bloomberg while insisting it’s still committed to the second headquarters (HQ2) in the Washington, DC suburb, where it has committed to hiring 25,000 workers and spending $2.5 billion. Amazon has already hired more than 8,000 people while completing the first phase of the new campus, including two towers in the 2.1-million-square-foot Metropolitan Park. The suspension affects development on PenPlace, a larger area across the street where it plans to build three 22-story office towers, a 350-ft corporate conference center and an indoor garden. In addition, the delay could have a ripple effect on the area as local developers, construction workers and other businesses have set plans in motion based on Amazon’s timeline.

“We’re always evaluating space plans to make sure they fit our business needs and to create a great experience for employees,” said Amazon real estate chief John Schoettler. “And since Met Park will have space to accommodate more than 14,000 employees, we’ve decided to shift the groundbreaking of PenPlace out a bit.”

Amazon’s county-approved plans require it to meet construction and permitting goals by April 2025 unless it gets an official extension.

The company settled on the Arlington offices after its hyped nationwide search for a second headquarters in 2017. Critics panned the move as a stunt to start a bidding war over who could offer the mega-corporation the juiciest taxpayer-funded incentives. Amazon initially settled on a split between Queens, NY and Northern Virginia but withdrew from Queens after facing opposition from local politicians and officials, including Rep. Alexandria Ocasio-Cortez (D-NY), who objected to the nearly $3 billion in financial kickbacks the company was set to receive. Around 10 months after Amazon withdrew its New York plans, the company announced it would still build new offices in the Hudson Yards neighborhood of Manhattan’s West Side.