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CRE market booming as Rochester gains national attention

Despite predictable investment returns and a marketplace devoid of rollercoaster swings in valuations, commercial real estate in Rochester has always flown a little under the national radar.

“It’s been a bit of secret for a while,” said Chris Giunta, salesperson at Cushman & Wakefield/Pyramid Brokerage Co.

The secret isn’t so secret anymore, however.

Crexi, a commercial real estate marketplace and data-center-powered AI technology, ranked Rochester No. 4 on the list of “7 Surprising CRE Markets with Strong Forecasts.” Also on the list: Kingsport, Tenn.; Fort Wayne, Ind.; Oshkosh, Wis.; Portland, Maine; New Haven, Conn.; and Grand Rapids, Mich.

Potential profit margin for investors was the determining factor for the cities that made the list. Rochester scored highly due to low vacancy rates across all asset classes, robust transaction volumes and the number of properties available at an affordable price.

“There’s been some really strong fundamentals here and we’ve seen a lot of activity, especially with people coming into the market,” Giunta said. “It’s been a stable market and you kind of know what you’re going to get here. There are attractive yields and a lot of New York City and downstate capital is chasing those yields.”

Now, however, there appears to be more national interest. Real estate investment trusts (RETIs) and private investors from across the country are entering the market.

“In a lot of smaller markets like Rochester, there’s mostly local interest and in-state interest,” said Shanti Ryle, content marketing manager at Crexi. “But 64 percent of investors digging into Rochester market data through Crexi are from outside of New York, a significant increase.

“People are looking at increasingly diverse, under-the-radar markets. They have more data to make decisions. More serious institutions are paying attention to smaller locales like Rochester.”

The proof can be found in the sales numbers. Through mid-August, total transaction volume in the market ($549.3 million) had already bested the total for 2021 by $79.9 million, according to Crexi data.

Multifamily is up dramatically, with $350 million in transactions compared to $169 million in 2021. That figure is skewed by one deal – the $161.5 million paid for APEX student housing by Harrison Street Real Estate Capital, LLC of Chicago, very likely the largest single commercial real estate transaction in the history of the market.

Still, multifamily has been hot as investors see opportunity to raise rents because prices on the residential real estate market continue to price out, or push the sidelines, would-be home buyers.

“Single-family home prices were appreciating at 3 percent for years,” said Mike Smith, CEO and founder of The Cabot Group, a CRE advisory and services firm. “In the last two years, they’ve gone up 17 percent. When the values get that high, people who had the American dream of home ownership have to rent an apartment.”

And basic supply and demand says owners of those apartments can charge more for rent. That’s perhaps one reason Rushmore Management of Lakewood, N.J., spent nearly $109 million on 16 multifamily properties in the Rochester metro area between December and July. The purchases included $49 million for the 311-unit Clearview Farms Apartments & Townhouses in Wheatland and $21 million for the 199-unit Little Creek Apartments in Gates.

Industrial/warehouse also remains a very strong sector. The vacancy rate as of the second quarter was just 4.5 percent, according to the Q2 Marketbeat by Cushman & Wakefield/Pyramid Brokerage. In reality, the number is probably even lower, Giunta said, due to older space that is functionally obsolete due to low ceilings and/or wooden floors.

Because lease rates have been moderate, new property owners see opportunity to bump the price per square foot.

“If the previous owner was leasing at $5 a square foot and you raise it up to $6, $6.25, $6.70, that’s a 20 to 25 percent increase,” Giunta said.

Transactions involving single-tenant net-lease deals have been commonplace. National real estate investment firms – with a focus on national, well-established clients — buy the properties, knowing the long-time tenant is locked in for a decade or more.

Cove Capital Investments of Torrence, Calif., bought the FedEx Ship Center on Manitou Road in March for $18.792 million. FedEx has a lease through 2028, with two five-year options. Cove Capital’s portfolio is heavy on FedEx, Walgreens and Amazon facilities.

Realty Income Corp. of San Diego bought the Tractor Supply Co. building on Latta Road in Greece for $5.794 million in January. The lease runs through 2035. Realty Income owns nearly 11,000 properties across the country, with a quarter of the portfolio comprised of convenience, dollar and drug stores.

“It’s almost like investing in bonds,” Giunta said. “There’s very little management, the tenant is paying for everything, and you’re buying the credit of the tenant.”

“I think it’s been a secret for a while, but the commercial market here has been very good,” Giunta said. “We’re extremely optimistic about the next six, 12, 18 months.”

While Crexi data shows total transactions involving the retail properties are down year-over-year, Janell Vanegas, principal at Venture Brokerage Group, said there’s no reason to worry about the sector.

“We have so many holes with so many retailers across the country that want to be here,” Vanegas said. “I don’t think bricks-and-mortar will ever be completely replaced because people value that shopping experience.”

Venture Brokerage Group works with preferred developers, the firms hired by national retailers to find them real estate. Vanegas said national tenants are on the way. Bob’s Furniture has a store planned in Henrietta. A upscale eye glass studio is looking at the Whole Foods plaza in Brighton.

“There is definitely more national interest in the market,” Vanegas said.

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Essential retailers take on ever-changing rules, role during pandemic

What worked last week doesn’t necessarily work this week.

That’s pretty much what essential retail businesses are dealing with as they carry on in the face of the COVID-19 pandemic. Just a few days ago, many companies were voluntarily providing masks, gloves and sanitizers to their frontline workers. This week a new executive order from Gov. Andrew Cuomo requires them to do so and requires employees facing the public to wear them — something that has been hit-and-miss up to now.

“It’s a new world for retailers; it’s a new world for customers,” said Ted Potrikus, president and CEO of the Retail Council of New York State. Retailers have traditionally trained and operated in a “get out there and sell” mentality, he said.

“That’s all been replaced by this thing nobody was prepared for, which was ‘get out there and protect,’” Potrikus said.

Now, Potrikus said, “It’s get your two things and get out. That is so upside down in the world of retail.”

Kathy Sautter, public and media relations manager at Tops Friendly Markets, said a crisis team now meets daily to review COVID-19 news, and then updates the Buffalo-based chain’s 162 stores by phone and email about changes. Wegmans Food Markets Inc. has a similar team, communicating with 50,000 employees by sharing videos and messages on its internal website.

New ways to help customers maintain distance from each other are one example of those changes.

Stores that once welcomed all the people they could safely fit into their aisles are now cutting back to a fraction of their capacity and cautioning customers to stay 6 feet apart. Trader Joe’s in Pittsford was among the first locally to limit the number of customers in the store. Tops president John Persons said in a video to consumers that those stores are removing free-standing racks and tables so there will be more room to practice social distancing.

Nearly all essential stores, such as grocery stores, big box retailers like Walmart and Target, and home improvement stores have:

Cut back hours to allow for more clearing and restocking;
Introduced additional cleaning routines;
Added or beefed up curbside purchases or delivery;
Offered paid sick leave;
Upped pay and/or provided bonuses to entice employees to remain on the job;
Publicized that they’re hiring; and
Included information on their websites about what they’re doing to keep customers and staff safe.

Many retailers have also donated money and goods to help those affected by the pandemic and the economic hardships it is causing.

Inside their stores, both Tops and Wegmans have added Plexiglas barriers at checkouts to minimize the swapping of germs between clerks and customers. McDonald’s Corp. has been adding them to drive-thru windows.

Wegmans announced this week that it will start giving employees wellness checks before they begin their shifts.

“Anyone exhibiting symptoms or with a temperature of 100 degrees or higher, will be asked to go home (with pay) and contact their medical provider. Anyone who doesn’t have a doctor can take advantage of a telemedicine option for the care they need,” read a Facebook post Wegmans made on Monday.

Walmart has said it is taking the temperature of employees when they come to work. Tops has also instituted wellness checks.

All these efforts have not gone on without a few hiccups. Earlier this month employees walked off the job at Amazon, Whole Foods, Family Dollar, Walmart, McDonald’s and other retail workplaces to protest what they considered insufficient health protections.

The Retail, Wholesale and Department Store Union has been holding Amazon’s feet to the fire after it fired the worker who led the walkout, and after internal documents revealed top-level executives were hoping to smear him in an attempt to stifle unionization. The executive who proposed the campaign has since apologized for allowing emotion to shape his statements.

“I’m sure some brands have made missteps along the way,” Potrikus said, “No store … has the latitude anymore to just ignore what their customers and what their workers are saying. They have to be responsive in a very careful way.”

He noted that the New York Attorney General and State Department of Labor are both enforcing related laws.

The U.S. Occupational Safety and Health Administration also recently issued reminders to employers that state and federal laws protect whistleblowers against retaliation.

For the most part, though, stores are running as quickly as they can to keep up with the demands the pandemic is placing on them. That includes creating new jobs or designating new responsibilities for existing employees.

Tops’ Sautter said, “Each store has an associate whose only job is to clean and sanitize the front end registers, check stands, conveyor belts, customer service desks, restrooms, point of sale devices and other frequently touched surfaces most accessed by customers on a continual basis during operating hours.”

Understandably, some employees have been reluctant to continue exposing themselves to potential danger. Sautter said some Tops employees have opted to take leave. Wegmans says it has allowed workers who are most vulnerable to take positions elsewhere in the company that are not public-facing.

“Our COVID-19 job-protected voluntary leave gives employees the opportunity to take time off unpaid if they are uncomfortable being at work,” said Laura Camera, a spokeswoman at Wegmans. “While we do have employees taking advantage of this leave, we work very hard to maintain a healthy and safe work environment for our people.”

Meanwhile, the employees who remain on the job continue to restock shelves that are rapidly emptied by nervous consumers.

“Because this is a national as well as international pandemic, all retailers are in the same predicament when it comes to finding product to meet the demand, which means an increased demand on our vendors,” Sautter said. “Many manufacturers and suppliers of hand sanitizers, soaps and cleaners do not have much available product to ship at this time. We are working with all of the affected supplier partners on an hourly basis in an effort to re-fill our supply chain and our stores.”

Camera added, “While the unexpected increase in demand has challenged the supply chain, we’re seeing it start to equal out, and are confident it will stabilize as long as we all prioritize our needs. … Although we may not have every variety available, we are working hard to give our customers options in each category. We continue to receive shipments to our stores every day.”

Potrikus credited Empire State Development with taking steps that prevented worse disruptions of the supply chain. Anticipating potential problems, ESD was having conversations with retailers before the pandemic really hit, and early on declared warehouse, fulfillment and shipping operations were essential businesses, he said, so they could continue operating.

“The biggest impediment to the supply chain are the people who go in and buy 16 cases of toilet paper in one run,” Potrikus said.

Despite some snags, Potrikus said, retailers have quickly pivoted in their new roles.

“You’ve had businesses go from two months ago where their biggest concern was how do you spell these things. And suddenly they have to become public health officials,” he said. “It’s amazing how quickly they’ve adapted to that new role.”

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Monro expands partnership with Amazon

Monro Inc., the local automotive undercar repair and tire services dealer, has expanded its collaboration with Amazon.com.

Monro will provide tire installation services at more than 330 additional service locations in 10 states across the Eastern U.S., company officials announced Thursday. The service was launched in July in the 52 greater Baltimore area stores and has expanded to Georgia, Florida, Illinois, Indiana, Ohio, Maryland, Michigan, New York, Tennessee and Virginia.

Customers who shop for tires on Amazon can choose the ship-to-store option to have a Monro facility in their region install the tires. In the next year, Monro plans to make the service available to Amazon customers at more than 1,170 retail locations in 28 states.

Monro President and CEO Brett Ponton said the company was pleased with the Baltimore pilot.

“Our preferred tire agreements with online retailers are a key initiative of our omni-channel strategy, and this expanded collaboration underscores the strong progress we have made as we continue to develop our online presence,” Ponton said in a statement.

Earlier this year, the company launched a new business strategy, Monro.Forward, which focuses on driving operational excellence and delivering a consistent best-in-class customer experience. The Amazon partnership is a key component of that strategy, officials said.

Last year, the 60-year-old Rochester business changed its name, representing a milestone in the company’s history as it crossed the $1 billion sales mark for the first time. Last summer, former Chairman Robert Gross retired from the board, and Ponton was hired to replace former CEO John Van Heel, who stepped away from the position when his contract expired in October 2017.

The company also has continued its long-successful acquisition strategy. Monro this year has purchase 12 retail and commercial Free Service Tire Co. locations, as well as four wholesale centers; eight retail locations in Missouri from Sawyer Tire Co.; and seven additional stores the company has not yet disclosed information on.

Monro in September launched new corporate and retail websites as part of its new Monro.Forward strategy to “improve the overall customer experience and build a robust omni-channel presence.”

The company has more than 1,180 stores, 97 franchised locations, nine wholesale locations and three retread facilities providing automotive undercar repair and tire sales and services in 28 states.

Shares of company stock (Nasdaq: MNRO) were trading up in light volume Thursday morning at $65.46. In the last year, Monro stock has ranged from $45.45 to $73.45 per share.

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Follow Velvet Spicer on Twitter: @Velvet_Spicer

Approval of Whole Foods project ‘energizes’ opposition

The Brighton Planning Board’s decision this week to approve plans for a Whole Foods grocery store on Monroe Avenue apparently won’t stop a community organization that is suing over the project.

“They had a good inning,” said Howie Jacobson, the Brighton resident and public relations consultant who is the spokesman for Brighton Grassroots organization. “We’re a little sad, they scored a couple runs. (But) we’ve got the top of the lineup next. We’re energized.”

Jacobson said Grassroots will continue to press its suit in federal court to require a new traffic study for the project. He has long argued that there was a flaw in the previous study, which concluded that traffic from the grocery store and adjoining businesses will have a minor impact on traffic. Grassroots is arguing that use of the parcel rather than simply square footage of the businesses on it should be factored into the study.

“We think we’re going to win on this, mainly because of the New York DOT. The developer doesn’t have the proper permits from the DOT yet,” Jacobson said.

The project promoted by the Daniele Family Companies includes a 50,000-square-foot grocery store; a 22,000-square foot plaza; a drive-through Starbucks replacing the one at the corner of Clover and Monroe; and potentially two additional restaurants.

Jacobson called the planning board members “unanimously irresponsible to the town residents of Brighton. They totally exceeded their power in helping this developer.” Among his charges are that the town didn’t create a basis to deny opening of a separate Whole Foods restaurant or pub, or prevent using the site as a package delivery site for Whole Foods’ new owner, Amazon, both of which would cause additional traffic.

But the town’s planner, Ramsay Boehner, said the board put 42 different conditions on the project, which either the developer or Whole Foods would have to address if they change things.

“If and when a restaurant or pub is proposed a conditional use permit shall be obtained from the planning board,” Boehner said. “That’s not what they’re proposing,” he said, but the conditions put the citizens, developer and business owners on notice that if changes are made, the changes have to be brought back to town officials for approval first.

“There are other town reviews and approvals if you want to do these things,” Boehner said.

The restaurant/pub condition does not apply to prepared food bars that Whole Foods might operate within the grocery store, Boehner said.

He categorized developer’s next steps as procedural ones to clear the way for construction.

Members of the Daniele family were not immediately available for comment.

Included in the project, which was given incentive zoning status, is two “give backs” to the town. One is extension and improvement of a walking trail along the north edge of the property. The other is funneling traffic from eight businesses on the south side of Monroe Avenue through a single entranceway at a new traffic light, eliminating a Frogger-effect for people traveling to and from those businesses, including some owned by Daniele Family.

Boehner has said in the past that opposition to the project is based on residents’ dislike of Amazon. Jacobson contends it’s only the additional traffic Amazon’s practices would bring to Whole Foods that is the issue.

Jacobson said Amazon has been adding package lockers to all of its new Whole Foods stores, which is part of its plan to make the stores more profitable. “They have seen an 11 percent increase in traffic already.” If that’s going to happen at the Brighton store, he said, “just tell us up front so it can be factored into the traffic.”

A March 2018 article in Business Insider about Amazon’s purchase of Whole Foods stores listed these changes that took place at Whole Foods as a result of the change in ownership.

Prices dropped.
Amazon tech items, such as the Echo and Echo Dot, Kindle e-readers and Fire tablets were introduced to Whole Foods shelves.
Amazon Prime replaced Whole Foods’ customer loyalty program, and discounts at Whole Foods were provided for customers using the Amazon Prime Visa.
Some stores had lockers added for Amazon deliveries.
Whole Foods items were added to Amazon’s selection online.
AmazonFresh memberships were developed to deliver Whole Foods groceries within two hours.

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Rochester doesn’t make Amazon’s list of finalists

Amazon announced a list of 20 finalists for its ‘HQ2’ project, and Rochester did not make the list.

The ecommerce giant announced last year it planned to invest $5 billion in a second headquarters in North America. Jurisdictions throughout New York state bid on the project. Rochester and Buffalo joined forces to submit a proposal that touted the region’s dynamic site locations, information on the region’s existing and evolving innovation ecosystem and background on the area’s more than 60 colleges and universities.

New York City, Albany and Syracuse also submitted proposals for the $5 billion investment the online shopping giant has said it expects to make in the winning region. New York City was the only New York location to make the list of finalists.

“While this news is certainly disappointing, we’re proud of the comprehensive proposal we put forth on behalf of Buffalo and Rochester. The joint collaboration between Buffalo and
Rochester has been an inventive exercise in big picture, regional thinking focused on the attraction of new capital investment and jobs in Western New York,” said Matt Hurlbutt, president and CEO of Greater Rochester Enterprise Inc. and Tom Kucharski, president and CEO of Invest Buffalo Niagara, in a joint statement. “By linking efforts, the combined Buffalo-Rochester Metro Corridor offered a sophisticated, robust and compelling proposal that showcased the talents of our 2.2 million people and our extremely livable communities.”

The 20 finalists are:

Atlanta
Austin
Boston
Chicago
Columbus, Ohio
Dallas
Denver
Indianapolis
Los Angeles
Miami
Montgomery County, Md.
Nashville
Newark
New York City
Northern Virginia
Philadelphia
Pittsburgh
Raleigh, N.C.
Toronto
Washington, D.C.

“In Rochester we should all be proud of the proposal we put together, and the fact that we were viewed as a contender for the selection of the new Amazon Headquarters by national experts is a testament to Rochester’s growing economy and quality of life,” Mayor Lovely Warren said. “I would like to thank all of our partners who helped put together a compelling proposal, and together we will continue to explore every possible avenue to create more jobs and bring economic opportunity and equality to our citizens.”

Monroe County Executive Cheryl Dinolfo said, “fully participating in this process will help our community better compete for other global employers and jobs in the future, regardless of the end result. Our region likely scored highly on much of Amazon’s core selection criteria, particularly when it comes to our highly-skilled workforce and world-class colleges and universities. We can and will use those assets as opportunities to attract even more jobs and investment here moving forward.”

Greater Rochester Chamber of Commerce President and CEO Bob Duffy said that while he thought the region would make the top 20 or 25 and he was disappointed to hear it hadn’t, he didn’t think anything went wrong.

“I’m very proud of our submission. We put a great submission together, one I’m very proud of, one that really reinforced the strengths of this region,” Duffy said at a press gathering Thursday, noting that the proposal would be kept confidential. “Obviously Amazon was looking for larger metro areas, and one of the things I believe was going to be a deficit for us from the start was the international travel connections.

Duffy said the region has much to offer and Rochester has a number of companies already that do business with Amazon.

“I played sports my whole life,” Duffy said. “I find that in sports and in life, if you do your very best, you put forth your very best effort, you might not always win, but you feel pretty good about what you did.”

Duffy said the team that put together the proposal learned a lot and the process reinforced the strengths and pride we have in Rochester.

“I think it’s also put us on the radar for other companies already,” he added. “We sat with companies as recently as this week, which is a pretty exciting opportunity for us. We’re going to roll our sleeves up and go back at it.”

Duffy said the region has much to offer, including its affordability, a sentiment echoed in the statement from Hurlbutt and Kucharski.

“Our region boasts a number of key differentiators, including well-documented affordability, low operating costs, ease of travel—via bicycle, public transit, or automobile—extensive access to leisure/lifestyle activities, dynamic development site locations, an existing and evolving innovation ecosystem, 60-plus colleges and universities and a central location within the internationally significant U.S./Canada community,” Hurlbutt and Kucharski said.

Duffy, commenting on future plans, noted Apple’s announcement this week to build a new campus and add up to 20,000 jobs. He said “there is nothing we don’t go after when we hear about it.” Duffy also said he believes Amazon may have future opportunities that the region may benefit from.

“Thank you to all 238 communities that submitted proposals. Getting from 238 to 20 was very tough – all the proposals showed tremendous enthusiasm and creativity,” said Holly Sullivan, Amazon Public Policy. “Through this process we learned about many new communities across North America that we will consider as locations for future infrastructure investment and job creation.”

Amazon evaluated each of the proposals based on the criteria outlined in the request for proposals to create the list of 20 HQ2 candidates that will continue in the selection process. In the coming months, Amazon will work with the candidate locations to dive deeper into their proposals, request additional information, and evaluate the feasibility of a future partnership that can accommodate the company’s hiring plans as well as benefit its employees and the local community. Amazon expects to make a decision in 2018.

Rochester and Buffalo to collaborate on Amazon HQ2 proposal

Greater Rochester Enterprise Inc. will work with Invest Buffalo Niagara to entice Amazon.com Inc. to locate its second headquarters in the Buffalo-Rochester Metro Corridor.

The collaboration will give officials the opportunity to leverage both regions’ assets.

“As far as Invest Buffalo and Greater Rochester Enterprise, we’ve been working together for a number of years,” said GRE interim President and CEO Matt Hurlbutt. “We see this as a natural progression of working together and a unique response to the opportunity.”

In September, Amazon issued a request for proposals for a project related to site locations for the e-tailing giant’s HQ2. Amazon officials have said the new facility will employ as many as 50,000 staffers with an average total compensation of $100,000 annually. The project is expected to require more than $5 billion in capital expenditures.

InBn and GRE will present an urban campus opportunity for Amazon’s consideration, Hurlbutt said. The proposal is not being made public at this time, he added, and the choice between locating in Rochester or Buffalo will depend on Amazon and its selection process.

“It’s presenting a super-region to them; instead of competing with the Buffalo area, we’re going to be working with them,” Hurlbutt said.

Amazon has requested all proposals be submitted by Oct. 19.

“Over the years, some of the most innovative companies in the world have called Buffalo and Rochester home,” said Rochester Mayor Lovely Warren and Buffalo Mayor Byron Brown in a joint statement. “We look forward to seeing that pioneering history showcased in the proposal alongside the recent resurgence that our cities are experiencing, be it through notable downtown commercial and residential developments, tech and startup industry expansion and activity, affordable housing and good jobs, or the newfound urban vibe that has been attracting millennials and working professionals to the region.”

In its request for proposals, Amazon officials noted several prerequisites for its new headquarters. The company has a preference for a metro area with more than 1 million people; a region with a stable and business-friendly environment; an urban or suburban location with the potential to attract and retain strong technical talent; and a community that thinks big and creatively when considering locations and real estate options.

The Buffalo-Rochester proposal will feature dynamic site locations, information on the region’s existing and evolving innovation ecosystem and background on the area’s more than 60 colleges and universities, officials said. The submission will provide detailed responses to the various components of the Amazon RFP, while expounding on several potential proposal differentiators, including the region’s affordability and ease of travel.

“This collaboration demonstrates the undeniable connectivity that already exists between our two great communities,” said Monroe County Executive Cheryl Dinolfo and Erie County Executive Mark Poloncarz in a statement.

Dinolfo and Poloncarz also noted the region’s highly skilled workforce, world-class colleges and universities and strong regional competency in radio-frequency identification, sustainable packaging, flight controls, drone technology, high-performance computing, software development and data analytics as capabilities that will help the proposal stand out.

Follow Velvet Spicer on Twitter: @Velvet_Spicer

Rochester pitches area as site for Amazon’s second headquarters

Online shopping giant Amazon.com Inc. is looking for a landing spot for its second headquarters, and some community leaders are pitching Rochester as the perfect match.

Amazon this week announced plans to build a second facility, dubbed “Amazon HQ2,” in North America. The company expects to invest more than $5 billion in construction and grow the second headquarters to include as many as 50,000 high-paying jobs, officials said in a statement Thursday. Construction and ongoing operation of Amazon HQ2 is expected to create “tens of thousands” of additional jobs and “tens of billions” of dollars in additional investment in the surrounding community, according to the statement.

Rochester’s leaders have been pitching the community to Amazon since January.

“On behalf of Greater Rochester Chamber of Commerce, which represents over 1,300 employers in the nine-county Rochester, New York region, I’m writing to ask you to consider our community as a potential location for the future expansion of Amazon.com’s operations,” Robert Duffy, Chamber president and CEO, wrote in a letter to Amazon President Jeffrey Bezos nearly nine months ago.

In his first letter to Bezos, Duffy wrote that as New York’s third-largest city Rochester has a rich history of entrepreneurship, philanthropy, innovation and business success. Duffy touted the region’s colleges and universities and the stunning Fingers Lakes region.

“Most importantly, the Rochester-Finger Lakes area has a highly educated, skilled and professional workforce with cutting edge packaging experience,” Duffy wrote in the Jan. 31 letter. “Packaging is one of our community’s many strengths, which could be tremendously beneficial to Amazon, a world leader in the delivery of goods.”

Duffy noted his history in the political arena, including his time as mayor of Rochester and lieutenant governor alongside Gov. Andrew Cuomo. He pledged significant assistance from Rochester’s corporate, governmental and educational partners, noting that Cuomo and his economic development team “would be especially supportive if you invested in the upstate region.”

Amazon’s Seattle headquarters employs more than 40,000 individuals and comprises 8.1 million square feet spread across 33 buildings. Its Seattle campus features 24 restaurants and eight other services. The company invested $3.7 billion in buildings and infrastructure, and employee compensation for its Seattle headquarters totals $25.7 billion.

“We expect HQ2 to be a full equal to our Seattle headquarters,” Bezos said in a statement. “Amazon HQ2 will bring billions of dollars in up-front and ongoing investments, and tens of thousands of high-paying jobs. We’re excited to find a second home.”

Amazon officials noted several prerequisites for its new headquarters. The company has a preference for a metro area with more than 1 million people; a region with a stable and business-friendly environment; an urban or suburban location with the potential to attract and retain strong technical talent; and a community that thinks big and creatively when considering locations and real estate options.

In a follow-up letter to Bezos sent Thursday, Duffy reiterated Rochester’s assets.

“As you will see, Rochester has an abundance of strengths that completely align with the needs of this project,” Duffy wrote in his most recent letter. “Our region is in the midst of a major economic transformation, and we would enthusiastically welcome Amazon to be a part of it.”

Amazon has opened its Request for Proposal process to state, county and local areas. Proposals are due Oct. 19 and the company expects to announce its decision in 2018.

Follow Velvet Spicer on Twitter: @Velvet_Spicer

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