Amazon is delivering more jobs to Boston.
The e-commerce giant announced on Tuesday a major expansion of its tech operations in the city, adding 3,000 jobs over the next few years in a 630,000-square-foot office to be built in the Seaport District. It will go up alongside a building under construction and expected to open early next year that will house 2,000 Amazon engineers, software developers, and other employees.
The rapid expansion by the Seattle company represents an enormous investment in talent and brick-and-mortar space in Boston at a time when some tech firms are shrinking offices and going remote. But for Amazon ― which would have nearly 7,000 employees in Boston and Cambridge when the buildings are fully occupied ― having a major physical presence here will help it innovate and grow, said Rohit Prasad, a Boston-based vice president at Amazon.
“Boston is one of the seats of learning in the United States,” said Prasad, who is head scientist for Amazon’s Alexa virtual assistant. “You have some of the world’s best universities and just this natural flow of talent into Amazon and other tech companies.”
Amazon will lease space in a 17-story building planned as part of WS Development’s 23-acre Seaport Square mixed-use project. The tower, at the corner of Congress Street and Boston Wharf Road, will be adjacent to a 430,000-square-foot space it signed a lease for three years ago. The new building needs design approval from the city but otherwise has all permits. WS hopes to start construction by summer and be finished by 2024.
The developer would also create a long-planned performing arts center for the Seaport, one of the few major civic spaces in the fast-growing district, which has been criticized for its lack of public access.
As part of the permitting for Seaport Square, WS and the Boston Planning & Development Agency negotiated space for a pair of theaters: a 500-seat performance center and a more intimate 100-seat venue. The complex would be smaller than what was envisioned by the Menino administration, but more in line with what arts groups in Boston today need, city officials have said. Now that construction is ready to start, WS executives said, they’ll start talking with potential tenants.
As with its first building at Seaport Square, Amazon is eligible to receive a $5 million city property tax break for the second one if it creates 2,000 jobs within two years of opening, though a spokesman said the company does not plan to pursue that incentive.
“By further expanding its Boston Tech Hub, Amazon is continuing to create new economic opportunities in our city,” Mayor Martin J. Walsh said in a statement. “This expansion will grow our technology workforce and support a strong pipeline of diverse talent and a range of new jobs and opportunities for Boston residents.”
The deal will cement Boston’s status as one of Amazon’s largest tech hubs outside of its home in Seattle and its so-called second headquarters in Crystal City, Va. Since opening a small outpost in Kendall Square in 2013, the company has expanded into offices in Fort Point, the Back Bay, and Medford ― along with its impending move to the Seaport. Many of its local employees focus on Alexa, but the company also has teams working on Amazon Web Services, robotics, and pharmacy technology.
As Amazon’s footprint has grown in the Boston area, so has its presence in civic life. In December, the company hired a top Walsh aide to lead external affairs locally, and it has continued adding jobs here at a brisk pace. The region’s tech-oriented workforce and vibrant research scene make it attractive, Prasad said.
“There’s a really diverse base of talent here,” Prasad said. “Everything we do is becoming so multidisciplinary in nature, and Boston really makes sense for us as a place to grow.”
While most of the company’s Boston tech employees are working remotely because of the pandemic, Prasad said Amazon plans to bring most of them back in person at least some of the time, when health and safety conditions allow. In-person hours might become more flexible, he said, but the company has no plans to abandon central offices.
“We have learned to work better remotely,” Prasad said. “But we’re also a firm believer in the serendipity that happens when you’re co-located with people. It just doesn’t have the same feel if you’re working from home.”
More companies deciding to adopt a similar strategy would be good news for Boston’s beleaguered downtown office market. Vacancy rates are the highest they’ve been in a decade, according to the real estate firm CBRE. More than 3 million square feet of space — two John Hancock Towers’ worth — are available for sublease from companies with long-term leases they’ve determined they no longer need.
In that light, having one of the best-known companies in the world commit to more than 1 million square feet is an enormous vote of confidence, said John Barros, the city’s director of economic development. Barros said he expects more companies to follow Amazon’s lead once the COVID-19 crisis subsides.
“Everybody’s looking to understand the new urban landscape, and whether people come back to offices,” he said. “This is a resounding answer to that question. Amazon is clearly making a statement here.”