Amazon reportedly plans to split HQ2 between two locations instead of picking one

Amazon.com Inc. will choose two locations for its new second headquarters, according to the Wall Street Journal, which cited an unidentified person familiar with the matter.

Last year, the e-commerce giant announced plans to invest $5 billion in a second headquarters and hire as many as 50,000 people there, setting off a frenzy of interest from cities in the United States and Canada. It has announced 20 finalists and is scheduled to make a final decision by the end of the year.

The company will choose two locations instead of one, according to the Journal, which said one location lacked sufficient technology talent. The investment and new jobs would be split evenly between the two locations, the Journal said.

Amazon also may want to avoid criticism that its arrival in a new town overwhelms the area. The company has fueled an economic boom in its hometown of Seattle, where it is also often blamed for traffic problems and skyrocketing housing costs that squeeze some residents out of the city.

“You could look to Seattle and see that it’s had great positive consequences, but it also probably has had some unintended ones that maybe aren’t as well received,” said Michael Lewis, a real estate analyst at SunTrust Robinson Humphrey Inc. “You can see what it’s done to the cost of living in Seattle.”

The Washington Post reported Saturday that Amazon was in advanced discussions with the Washington, D.C., suburb of Crystal City, Va., for the second headquarters. An Amazon spokesman declined to comment.

Some of the contenders are near one another and draw from the same labor pools. New York City and Newark, N.J., are among the finalists, as are Washington, D.C.; northern Virginia; and Montgomery County, Md. Amazon could choose one metropolitan region and still have to negotiate with multiple states and local governments for tax incentives.

Los Angeles is also on the list of finalists.

UPDATES:

2:45 p.m.: This article was updated with a comment from analyst Michael Lewis and additional details.

This article was originally published at 12:30 p.m.