2020 | Business

Amazon no longer trying for distribution center in Gaithersburg

Landlord removed tech company from plans for former Leidos campus

Amazon is no longer interested in creating a distribution center on the site of the former Leidos campus in Gaithersburg at 700 N. Frederick Ave.

File photo

Amazon is no longer interested in creating a distribution center on the former Leidos campus in Gaithersburg after months of discussions between the company, the landlord and city officials.

In an email to Bethesda Beat Wednesday night, Amazon spokeswoman Courtney Johnson Norman wrote that the company had “decided not to pursue a location in Gaithersburg at this time.” Norman added that Amazon continues to “explore opportunities to invest and grow across the state and the region.”

The facility would have served as the place where packages are sorted before they are sent out for delivery to their destination. Initial estimates projected that the distribution center would create up to 850 jobs and cost $92 million to build.

According to documents filed with the city, of the 850 jobs, 300 would have been a mix of full- and part-time employees handling “seasonal demands.”

Another 400 would have been full-time delivery drivers through a third-party program. The other 150 would have been “flex drivers,” in which workers could use their own vehicles to make deliveries.

Frederick-based Matan companies purchased the 44-acre site at 700 N. Frederick Ave. in January 2019 with the goal of developing it into a mixed-use property.

In May 2019, Matan filed a sketch plan showing multiple buildings and multiple uses, as the first step in the development process. The plan was approved in August of that year.

In May 2020, Matan filed a new sketch plan stating that the facility could be for “one or more” uses. Bethesda Beat reported that same month that Amazon was interested in building a “last-mile” distribution center on the property.

Amazon did not publicly acknowledge that it was interested in the property at that time, but the company’s logo was included in the plans. Additionally, the subject line of an email sent from Matan to city officials in April contained the phrase “Project Summit – Amazon.”

Amazon revealed during a City Council meeting on July 28 that it was interested in using the site. At that meeting, some council members questioned why Matan wasn’t using its original sketch plan with “multiple buildings and multiple uses.”

On Aug. 10, Matan Principal Mark Matan informed Gaithersburg Director of Planning and Code Administration John Schlichting that the property owner was withdrawing the sketch plan it submitted for “one or more” uses, and would revert to the original sketch plan it submitted last year.

At the time, though, it wasn’t clear if Amazon was still part of the picture.

Gaithersburg Assistant City Manager Tom Lonergan told Bethesda Beat in an interview on Wednesday that Amazon officials contacted him and Mayor Jud Ashman two weeks ago to inform the city that the company was no longer interested in the Leidos property.

“It was just a polite outreach to the city to say that they were not proceeding with that project any longer in the city, but that they would be open to discussion with us for other opportunities and other sites within the city,” he said.

Lonergan added that the city is working with Matan to move the development process forward based on its approved August 2019 sketch plan for the site. He said Matan plans to develop it with “a mix of companies and industries.”

Matan representatives could not be reached for comment Wednesday or last week.

Dan Schere can be reached at daniel.schere@bethesdamagazine.com