How landing Amazon HQ2 could increase rent in St. Louis area - KMOV.com

How landing Amazon HQ2 could increase rent in St. Louis area

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(AP Photo/Reed Saxon, File) (AP Photo/Reed Saxon, File)
ST. LOUIS, Mo. (KMOV.com) -

The St. Louis area could see a home building boom and sharp rent increases if it is chosen as the city for Amazon HQ2, an expert said.

Many cities are competing to be the location of Amazon’s second headquarters, with promises of 50,000 jobs and billions in investment.

Sidney Bennett, a researcher with Apartment List, says St. Louis could see a housing boom and rising rent if Amazon’s second headquarters put down roots in the metro area.

“We’re assuming any city bidding will build more housing than they have now. If they increase it by 40-50 percent, they can’t build enough housing to house new Amazon workers,” said Bennett.

Amazon likes to attract younger workers, a group that rents more than buys, which could drive up rent prices. Salaries Amazon would pay could also help and hurt.

“A lot of new construction would be at the luxury end of the market, and also when there’s competition for a shortage of apartments. Workers making $100,000 plus can bid up to get the apartments they want,” Bennett said.

Bennett says higher salaries would drag up wages for other workers in the city.

In Seattle where Amazon is based, rent has risen sharply.

“Our prediction is the St. Louis housing market would see a little more than one percent additional rent growth per year,” said Bennett.

The average rent in Seattle is currently $1,900 for a one-bedroom apartment. In St. Louis, it is $899.

Amazon says a city will be chosen for its second headquarters in 2018.

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