As Amazon narrows choice for HQ2, these cities finishing strong

Lisa Werner | Moment Mobile | Getty Images

Amazon corporate office building in Sunnyvale, California

As Amazon narrows down the choices for its coveted $5 billion second headquarters, it would do well to consider Austin and Dallas — the two finalists located in Texas, CNBC’s 2018 America’s Top State for Business. That is according to a new CNBC analysis of the 20 finalist locations, based on our latest data. Other strong finishers include Atlanta, Boston, Denver, Miami, Nashville and Northern Virginia.

The retailer has promised to name a location this year for the so-called HQ2 project, which it claims will ultimately employ 50,000 people. Amazon refuses to comment further about the timeline, but there is widespread speculation it could narrow the list of finalists as soon as this month.

Amazon’s initial request for proposals last year touched off a huge bidding war, with some 238 locations from Canada to Mexico submitting bids. The company listed four main criteria for the new location:

• Metropolitan areas with more than 1 million people.
• A stable and business-friendly environment.
• Urban or suburban locations with the potential to attract and retain strong technical talent.
• Communities that think big and creatively when considering locations and real estate options.

Each finalist passes the population test with flying colors, but their grades in the other categories vary widely. Of course, it is impossible to get into the heads of the planners at Amazon, especially Chairman and CEO Jeff Bezos. But CNBC used data from our 12^th annual America’s Top States for Business study to grade the locations based on the company’s criteria. In the case of Washington, D.C., and Toronto — which are not included in our Top States study — we used comparable data from U.S., Canadian, District of Columbia and Ontario provincial sources.

Our analysis has its limits. For example, most of the data is at the state level, so grades are identical for Austin and Dallas, as well as Philadelphia and Pittsburgh. Our report cards also assume that Amazon is giving equal weight to each of its four main criteria. But we do not know that to be the case, and the company is not saying. There is also that bit about trying to get into Jeff Bezos’ head. Nonetheless, a few broad trends emerge.