Port Authority, Amazon End Talks for Newark Air Cargo Hub

In the face of stiff opposition from local officials, unions and environmental groups, the Port Authority of NY/NJ announced Thursday it has ended negotiations with Amazon to develop a 250K SF global air freight terminal at Newark-Liberty International Airport.

Amazon responded to an RFP in August with a proposal to spend $125M to redevelop two aging cargo warehouses on the north side of the airport, creating a new cargo hub along with 1,000 new jobs. The Port Authority was offering a 20-year lease for the new cargo hub.

“After months of good-faith negotiations with the Port Authority of New York and New Jersey, we’re disappointed to report that we’ve been unable to reach a final deal for the regional air hub at Newark-Liberty,” Maria Boschetti, an Amazon spokesperson, said in a statement.

“Despite this outcome, we’re proud of our robust presence in New Jersey and look forward to continued investments in the state,” Boschetti added.

Huntley Lawrence, the Port Authority’s COO, said the two parties were unable to reach an agreement on final lease terms and “mutually concluded that further negotiations will not resolve outstanding issues,” NJ.com reported.  

Make the Road NJ, a group that opposed the lease, told NJ.com that Amazon “walked away” after it was “unwilling to meet minimum requirements the Newark and Elizabeth communities asked for on labor and environmental practices for the deal.

A Newark-based environmental group, the South Ward Environmental Alliance, called the announcement that talks had ended “a great victory for South Ward residents who came together for clean air and good jobs.”

After opposition groups staged demonstrations in front of Port Authority offices to protest the project, which they accused the PA of fast-tracking, officials including the mayors of Newark and Elizabeth, urged the agency to end “secret negotiations” with Amazon and address concerns about traffic, air pollution and labor issues.

The Port Authority responded by pledging to raise the minimum wage for airport workers to $19/hour by 2023. The PA also said contractors building the new cargo hub would be required to use union construction workers and to “enter into a dialog” with unions seeking to represent Amazon workers at the proposed facility.

Amazon announced at the end of May that it would be subleasing some of its warehouse footprint in NJ as part of its overall plan to reduce its portfolio of leased industrial space, estimated nationally at 370M SF, by at least 10M SF.

Amazon employs 58,000 full and part-time workers in the Garden State at two dozen facilities including 1M SF warehouses in Carteret and Burlington.