Same Day Package Delivery Force Logistics Co to Rewire Distribution Network

As online retailers have begun to focus more on two-day and same-day package delivery, Logistics companies and builders relook at warehouse development in strategic location to meet demand.

The rise of online shopping is forcing warehouse builders to redraw the map of logistics hubs on the East Coast.

During the weekend, FedEx Ground broke ground for its largest facility in the country, an 800,000-square-foot automated distribution center in Allen Township, Pa.

In the last five years, as online retailers have begun to focus more on two-day and same-day package delivery, warehouse development in the Lehigh Valley, which is to the north and closer to New York City, has surged, according to brokerage CBRE Inc.

Developers have added 56 million square feet of space, increasing the size of the market by 25% over that period, exceeding double-digit percentage growth in Houston; Columbus, Ohio; and the Inland Empire area east of Los Angeles.

 Tenants including Wal-Mart Stores Inc., Dollar General Corp., Uline Inc., Ocean Spray and PetSmart Inc. have added nearly 7 million square feet of distribution space in the last three years. This year alone, Samsung Electronics Co., Stitch Fix and Isuzu Motors Ltd.have signed large warehouse leases in the area.
Satish Jindel, a shipping consultant based in Pittsburgh who helped build FedEx’s ground network, said the new distribution center in Allen Township is in an appealing location because of its proximity to the large population centers of New York and northern New Jersey, but also has access to airfreight facilities at Lehigh Valley International Airport and logistics companies that have set up shop all over the area.

 

Full article at WSJ

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