Why Toronto might not land Amazon HQ2, according to the mayor

One day after Toronto threw its hat in the ring to be home to Amazon's second headquarters, Mayor John Tory was on Metro Morning to talk about the ins and outs of the city's pitch.

Toronto entered tight race to become home to Amazon’s second headquarters on Thursday

Mayor John Tory appeared on Metro Morning to talk about why Toronto entered the race to become home to Amazon's new headquarters. (John Rieti/CBC)

Housing might be Toronto's biggest disadvantage in the city's bid to be home to Amazon's next headquarters, said Mayor John Tory on Friday.

That, and the fact that a Canadian city might be automatically disqualified given the tumultuous political climate south of the border.  

"That's their calculation. We can't really speculate on that because we don't really know," said Tory in an appearance on Metro Morning on Friday.

In September, Amazon says it will invest $5 billion US to develop the site and eventually house as many as 50,000 workers in more than eight million square feet of space within a decade. (Mark Lennihan/Associated Press)

Toronto's pitch to the tech giant, released Thursday, highlighted promises to grow the city's tech talent pool and the affordability of labour here, but offered no special subsidies.

"We're offering smart people and a great way of life," Tory explained. "If you stepped up and said, we're going to write you a big cheque, what do you do about the next company that comes along?"

The housing equation

The nearly 200-page long bid detailed everything from the city's festivals to possible locations for a future headquarters.

"The inventory of rental housing stock is growing," it said, with diagrams to show the number of new condos coming in future years and photos of tree-lined Toronto streets.  

Toronto's bid to Amazon points out that more than 50,000 condo units are under construction - a possible antidote to pricier attached and detached houses. (Shawn Goldberg/Shutterstock)

But on Friday, Tory conceded that the city's scarcity of rental housing could be a serious knock against the bid, describing a recent meeting with a Silicon valley "titan" where "the first two questions that he and the fellow he brought with him asked were about housing."    

"I was able to say to them, look, we've got a real challenge here with that," said Tory. "We're trying to build more affordable housing and more rental housing generally."

Affordability crisis

The saving grace, he added, could come thanks to the fact that Toronto's bid is a regional one, with places like York and Peel included.

"We can say look, if we can build the proper transit… we have a much broader range of options as to where people can live within reasonable commuting range," said Tory. 
Seattle activist and writer Jeff Reifman says that the quality of life in Seattle has declined as Amazon has expanded its presence in the city's downtown core.

Beyond the difficulty of housing the possible 50,000 employees an Amazon headquarters could bring, Seattle activists contacted by CBC have cautioned that hosting the company could mean regular citizens lose out.

Activist Jeff Reifman since 2010, the number of unsheltered homeless in his city have doubled, urging other cities to think twice before inviting Amazon in.

"Whether Amazon comes or not we've got a challenge to deal with in the context of housing," admitted Tory.

The Trump factor

In addition to housing, Toronto's bid takes step to address another baked-in problem: a shortage of tech talent.

The provincial government has pledged to up the number of STEM graduates to "fuel the arrival of this company or other companies," said Tory — something he argues will help the city whether or not Amazon takes the bait.

Of course, Toronto's appeal could be moot if Amazon sees a move to Canada as politically disadvantageous under President Donald Trump.  

"What is their assessment at Amazon as to whether that is going to be a huge factor that will hurt them because steps will be taken by the administration to punish them for even thinking about this," said Tory.

 "That is a key consideration that will affect whether we are in the top 5 or really not contenders at all."

But before Toronto gives up hope, remember: the effect of the present U.S. administration could have the exact opposite effect on Toronto's chances.