The dark side of Expedia's move to Seattle
Seattle Mayor Ed Murray and Expedia CEO Dara Khosrowshahi and CFO Mark Okerstrom confirmed Thursday what everyone already knew: The online travel-booking company will be moving from Bellevue to the Amgen campus on Seattle's waterfront.
Run a quick search on Google Maps for directions from the company’s current Bellevue location to its future home in Seattle and you'll see that the commuting options for Expedia's Eastside employees are I-405, I-90, 520, I-5 and Mercer Street. What then will the move mean for Expedia workers — and Seattle traffic?
Expedia's buying the 40-acre, 750,000 square feet campus for $228.9 million — in cash— and taking possession at the beginning of 2016. That's after Amgen, the biotech firm that's closing its Seattle office, fully vacates. Expedia will take some 18 months to convert the space from biotech labs to software offices before moving all of its 3,000 workers to their new home in 2018. (Expedia will add an extra 200,000 square feet on the site to accommodate 1,500 more workers. No timeline yet on that workforce expansion.)
Rumors of the relocation have been bobbing around since February, when Okerstrom said Expedia was considering a move given that its Bellevue lease runs out at the end of 2018. Okerstrom also maintained that Expedia was committed to the Puget Sound region.
CEO Khosrowshahi insisted that his company was happy in Bellevue, but that Amgen's open campus layout — as opposed to a skyscraper — was just too good to pass up. "The view from the Amgen campus is beautiful," he said, adding that Seattle is also a “magnet for top talent.”
Khosrowshahi isn’t the only one who with his eye on Seattle's tech talent pool. Last month, Facebook announced its plan to move into a larger space in the city and grow its workforce by 400 percent (to 2,000 people). Chinese e-commerce giant Alibaba has leased offices in South Lake Union. Weyerhaeuser has broken ground for a new Pioneer Square headquarters that will house its 800 employees.
Murray, of course, is pleased as punch. “We’re delighted that Expedia is moving to Seattle,” he said Thursday. President of the South Lake Union Community Council, Mike McQuaid, couldn't agree more: “Any time we have an opportunity to retain a prominent global employer like Expedia or anytime we have the chance to foster employment, it’s a good thing.”
But Seattle has a down side. Khosrowshahi said 75 percent of his employees live on the Eastside, 25 percent in Seattle. Those Eastside commuters will necessarily have to travel the oft-clogged freeways, along Mercer Street and through the South Lake Union corridor.
Expedia spokeswoman Sarah Gavin said the company has been evaluating locations for years now, carefully exploring what a move would mean for travel times. “We’re a very data driven company,” said Gavin. “We’ve created a very robust map of commute times now and what they would look like in a move.”
Using the addresses of current employees, and data from both Washington State and Seattle departments of transportation, Expedia calculated average commute times to its new campus. The result: a 5-6 minute increase in travel times.
Anyone who’s braved Mercer St. during rush hour knows that 5-6 minutes seems suspiciously low. Even Mike McQuaid allowed that “we have very limited funnels into that part of town from the I-5 corridor.”
A survey of commuter modes from EMC Research in 2014 found that South Lake Union workers are drivers. Only 27 percent commuted by bus; that's fewer public transit users than any Seattle neighborhood except for the area around Seattle Center. And 45 percent of SLU employees drove alone, more than any other Seattle neighborhood. By contrast, 47 percent of downtown workers took the bus and only 21 percent drove.
In other words, SLU's got a car problem.
If Expedia commuters followed the patterns of their new SLU neighbors, the company's move would send an additional 1,600 cars and 675 bus riders onto Lake Washington bridges and through already gridlocked South Lake Union.
Okerstrom said that all Expedia workers will get fully-funded ORCA cards. Additionally, the company will provide 1,000 parking spaces (only…) and employees will pay market rate for their use. All of which suggests that Expedia is serious about encouraging the use of public transit. The problem is that public transportation is in short supply.
Go back to Google Maps and try finding a bus route from Bellevue: you end up winding around the southern part of downtown or scaling Queen Anne by way of Fremont. “Right now, there’s little bus service from South Lake Union to the Amgen campus,” said McQuaid. “It’s critically important that those east/west routes are developed.” Hopefully, before Expedia's 2018 move date.
Mayor Murray pointed to the city's plans for expanded bus service in the coming months, thanks to the voter-passed initiative last November. The Rapid Ride D line will get a significant bump in service, which will help, said McQuaid, but doesn't go far enough.
SDOT has added coordinated lights along Mercer Street which, according to agency director Scott Kubly, has already reduced travel time. SDOT is looking into adding smart traffic lights on Denny Way as well.
Expedia is also considering a shuttle service similar to Microsoft’s Connector. Nothing's been decided but, said Gavin, “it’s likely not a question of if, but how much."
Gavin says that Expedia will be working "extensively with SDOT" in the coming months. But much of what would make commuting from the Eastside more tolerable depends on the state's legislature and voters. Funding for Sound Transit 3, the rail car that would cross Lake Washington, is in Olympia's hands. Mayor Murray recently introduced a massive $900 million transportation levy, to be run next fall. The extent of the city's transportation infrastructure improvements hinges on its success.
Will longer, traffic-clogged commutes spook Expedia's current employees? Will it hurt recruitment? So far, the sentiment from inside Expedia seems to be, with two and a half years until the move, it’s still too early to tell.
“For now,” said one Expedia employee, "people are just absorbing the news. It’s hard to tell what the pulse will be long term. Two years is a long time in the life of a tech company, so who knows.”
But “some people," she added, "will clearly not be happy. In fact, I know people that work here, live here and never have gone into Seattle just because they hate the bridges.”
Sarah Gavin says the company’s actions will be driven by employee feedback and she doesn’t think people will leave. “People are pretty excited," she said. "People had a lot of questions, but [Expedia] has a transparent culture and people are confident that their ideas will matter. I live in Sammamish and I feel very confident in what the company will do.”
Confidence in Expedia is one thing, but confidence in the Mercer Mess getting fixed any time soon? Gavin laughed. “The city knows what needs to be done," she said. "It’s not a surprise to anyone that Mercer has had problems. We will figure it out.”