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Amazon pauses construction on second headquarters in Virginia

The Seattle-based company is delaying the beginning of construction of PenPlace, the second phase of its headquarters development in Northern Virginia

The Amazon DTW1 fulfillment center is shown in Romulus, Mich., April 1, 2020.
The Amazon DTW1 fulfillment center is shown in Romulus, Mich., April 1, 2020.Paul Sancya (AP)
New York -

Amazon is pausing construction of its second headquarters in Virginia following the biggest round of layoffs in the company’s history and shifting landscape of remote work.

The Seattle-based company is delaying the beginning of construction of PenPlace, the second phase of its headquarters development in Northern Virginia, said John Schoettler, Amazon’s real estate chief, in a statement. He said the company has already hired more than 8,000 employees and will welcome them to the Met Park campus, the first phase of development, when it opens this June.

“We’re always evaluating space plans to make sure they fit our business needs and to create a great experience for employees, and since Met Park will have space to accommodate more than 14,000 employees, we’ve decided to shift the groundbreaking of PenPlace (the second phase of HQ2) out a bit,” Schoettler said.

He also emphasized the company remains “committed to Arlington” and the local region.

Amazon announced the plans in February 2021 for an eye-catching, 350-foot Helix tower to anchor the second phase of its redevelopment plans in Arlington. The new office towers were expected to welcome more than 25,000 workers when complete. Amazon spokesperson Zach Goldsztejn said those plans haven’t changed and the construction pause is not a result - or indicative of - the company’s latest job cuts, which affected 18,000 corporate employees.

The job cuts were part of a broader cost-cutting move to trim down its growing workforce amid more sluggish sales and fears of a potential recession. Meta, Salesforce and other tech companies — many of which had gone on hiring binges in the past few years — have also been trimming their workforce.

Amid the job cuts, Amazon has urged its employees to come back to the office. Last month, Amazon CEO Andy Jassy said the company would require corporate employees to return to the office at least three days a week, a shift from the prior policy that allowed leaders to make the call on how their teams worked. The change, which will be effectively on May 1, has ignited some pushback from employees who say they prefer to work remotely.

Goldsztejn said the company is expecting to move forward with what he called pre-construction work on the construction in Virginia later this year, including applying for permits. The company had previously said it plans to complete the project in 2025.

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