Amazon Revives Bellevue Tower Construction, Eyes Office Expansion Amid Hybrid Work Shift

Amazon.Com Inc AMZN is restarting construction of a 42-story office tower in Bellevue, a Seattle suburb, after halting work on 22 floors since 2022. 

The pause in 2022 affected five towers in Bellevue and new offices in Virginia and Nashville as Amazon evaluated the pandemic’s impact on in-office work dynamics. 

However, Amazon shifted towards a hybrid work model, requiring employees to be in the office at least three days a week. 

By December, the company had already opened half of the Bellevue tower, named “Sonic,” and relocated approximately 1,000 employees there, with plans to accommodate over 4,500 employees upon completion later this year, CNBC reports. 

Also Read: Amazon Web Services Streamlines Operations, Reduces Workforce in Key Departments Amid Digital Pivot

Despite expanding its office space outside Seattle, Amazon intends not to increase its footprint in its hometown but plans to employ 25,000 workers in Bellevue. 

This expansion includes buildings like Dynamo, which opened in February for up to 1,500 employees, and the upcoming Bellevue 600 project, a 43-story tower with 1 million square feet of office space. 

While Amazon resumes specific projects, others remain on hold, like the second phase of its northern Virginia campus, HQ2, CNB writes. 

This phase, known as PenPlace, will feature three 22-story office buildings and a unique 350-foot-tall structure named “The Helix,” complementing the already operational first phase of HQ2.

Recent reports indicated Amazon is executing a plan to trim $1.3 billion in costs by significantly downsizing its office space and terminating leases early. 

Amazon currently has a 33.8% office vacancy rate. The strategy aims to lower this rate to 25% within the year and to 10% between 2027 and 2029. 

This initiative follows Amazon’s recent layoffs, which included hundreds earlier this year and approximately 27,000 across 2022 and 2023. These layoffs reflect a broader workforce and office space reduction trend among leading tech companies.

Amazon stock gained over 78% in the last 12 months. Investors can gain exposure to the stock via SPDR Select Sector Fund – Consumer Discretionary XLY and ProShares Online Retail ETF ONLN.

Price Action: AMZN shares are trading higher by 0.64% at $181.16 premarket on the last check Friday.

Also Read: Is Amazon Poised for Major Shift With Potential Dividends and Share Buybacks on the Horizon?

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Amazon Vancouver office photo via company. Used for illustration