Logistics property update: April 2021
Key newbuilds and acquisitions from the frontlines of logistics property
Kohl opens 1.2m sq ft Ohio fulfilment centre
Omnichannel retailer, Kohl, has announced the opening of a 1.2m sq ft e-commerce fulfilment centre in Etna, Ohio, USA. The centre, Kohl’s sixth, will focus on processing, filling and shipping orders and will be the company’s most efficient to date.
Construction was temporarily paused in 2020 due to the Covid-19 pandemic.
Kohl’s digital sales have increased by more than 100% in the last five years. The company is focusing on increasing operating margins. It is expected the new centre will help lower costs while allowing the company to get closer to customers.
The centre will be equipped with state-of-the-art technology, increasing productivity by more than three times. Five stages of the fulfilment lifecycle have been eradicated due to technology.
400 full-time jobs should be created, with further capacity for seasonal jobs.
Kohl has more than 1100 stores in the USA. In 2020, the company fulfilled nearly 45% of digital orders via its stores. Kohl’s other fulfilment centres are in San Bernardino, California; Edgewood. Maryland; Monroe, Ohio; and DeSoto, Texas.
Nestle’s opens 638,000 sq ft Leicestershire (UK) warehouse
Nestle’s £55m, 638,000 sq ft warehouse in Leicestershire, UK, has fully opened. Work on the site started in 2018 with a phased opening in mid-2020.
The warehouse is at the SEGRO East Midlands Gateway which is next to East Midlands Airport. It is operated by XPO Logistics, handling goods from 11 sites run by Nestle. It can store up to 45,000 pallets of chocolate, 18,000 pallets of coffee and 6000 tonnes of sweets. It employs around 200 people.
A liquified gas refuelling station is also being developed for Nestlé drivers to run energy-efficient trucks rather than diesel ones.
Panattoni builds 658,051sq ft distribution centre in Western Poland
Panattoni is to deliver a dedicated 658,051 sq ft distribution centre for TJX Europe in Salchow, Western Poland, to help supply products to its TK Maxx shops in Poland, Germany, Austria and the Netherlands.
The centre should be ready for autumn/winter 2022/23 and will be built on 57 acres of land. The build-to-suit facility will be the company’s sixth distribution centre in Europe.
Poland is increasingly becoming a hub for companies working across Europe because of its large and highly skilled labour pool as well as its central position and proximity to the German border.
New Flipkart fulfilment centres in India
Flipkart, a one-stop fashion destination, has gained approval for a 140-acre site in Manesar, India, for what will be its largest fulfilment centre in Asia.
In response to the growing demand for warehousing space created by the e-commerce boom, Instakart Services Private Ltd, a Flipkart group company, plans to set up a network of fulfilment centres and an associated logistics infrastructure throughout India.
Approval for the centre was granted by the Haryana Enterprise Promotion Board. It is hoped that 6000 direct and 12,000 indirect jobs will be created, with the potential for a total of up to 18,000 jobs ultimately. No date has been set, as yet, for the start of construction.
Instakart also plans to build a logistics campus in the Manesar area, close to Gurugram.
The company has also said it will be working with Adani Logistics Ltd to enhance the company’s supply chain infrastructure. AdaniConneX will build a new Tier 4 data centre and Adani Logistics will build a 534,000 sq ft fulfilment centre for Flipkart in Mumbai.
Flipkart will also set up its third data centre at AdaniConneX’s Chennai facility. The data centre will focus on data design for the company’s growing infrastructure needs, with particular emphasis on security and maintaining data locally.
New 160,000 sq m Amazon site in Corvera, Spain
Amazon is opening its second fully automated hi-tech centre 200m from its first site, next to the A30 motorway, alongside the airport in Corvera.
It will cover 160,000 sq m. Amazon also has sites in El Prat and Barbera del Valles (in Barcelona) and Dos Hermanos (in Seville). The new site will be used for Europe-wide product distribution.
Two speculative industrial sites across 212,000 sq ft for UK’s Chancerygate
Chancerygate plans to speculatively develop 156,797 sq ft of new-build light industrial space in Aston Clinton, Buckinghamshire, UK. Units will range in size from 4,370 sq ft to 41,355 sq ft. Acquired for an undisclosed sum from Midwinter Property Holdings, the site has a gross development value of £25m. Planning application will be submitted this spring and units will be available on both a freehold and a leasehold basis.
The Aston Clinton site is close to the Mercedes Benz and Jaguar dealerships and provides good access to the A41 and Junction 20 of the M25.
In another deal, the developer has acquired a 2.5-acre site in Brackley, Northamptonshire, where it intends to speculatively develop 55,000 sq ft of light industrial and warehousing space with units ranging in size from 2500 sq ft to 1500 sq ft. This scheme will have a gross development value of approximately £9m. The site is ideally positioned close to the A43 and M40 motorway.
Canada’s Groupe Robert builds Quebec automated distribution centre
One of Canada’s largest trucking and logistics companies is investing CA$150m in an automated distribution centre with a capacity for 60,000 pallets of fresh and frozen food.
Groupe Robert’s new site will be in Varennes, Quebec, and is expected to be operational in early 2023. It will add to the company’s existing 3.5m sq ft of warehousing space and will enable the company to expand into the food and cold storage sector. Groupe Robert’s fresh and frozen business is growing at a steady rate of 2.5% to 3% per annum.
A high level of automation will mean the pallets will not be touched by human hand before going into the cold tower. The site will be built with sustainability targets in mind. The company expects 60% of space to be used by Quebec producers with the rest of Canada using about 20% and the remaining 20% being used by internationalproducers. It hopes the move to locally sourced food driven by the Covid-19 pandemic will also bode well for future development.
The development is also being funded by a CA$15m Quebec government loan and financial support from the Fonds de Solidarite FTQ.
The new facility will make the company the first third-party logistics provider to have an automated warehouse for frozen and fresh food product in Quebec.d
555,000sq ft distribution centre for Brant, Ontario
Work is expected to begin shortly on a 550,000 sq ft warehouse/distribution centre in Brant, Ontario, Canada. The site is on a parcel of land at 260 Pottruff Road, east of Rest Acres Road, just off Highway 403.
The design will allow a 650,000 sq ft expansion within a couple of years.
Peter Vicuna of Vicuna Developments told a county council meeting that work is scheduled to begin in May or June this year, with completion expected in December 2022. It is believed a tenant, as yet unnamed, has already been secured for the site. (95)
Newlands Developments secures planning for 900,000 sq ft Northamptonshire warehouse
Newlands Developments has secured outline planning for up to 900,000 sq ft of warehouse space on the former Howdens Joinery site on Liliput Lane, Brackmills in Northamptonshire.
Two options are being considered: one for a single occupier with a cross dock warehouse of 894,00 sq ft including 126 dock and four level access doors; or three individual warehouse units in sizes ranging from 126,851 sq ft to 427,370 sq ft.
Winvic contract for UK’s largest single-occupier logistics park
Winvic has won the contract to construct a 2.94m sq ft global parts logistics centre to be leased to Jaguar Land Rover at Mercia Park, Leicestershire, UK. The centre will consist of five industrial units and will be the UK’s largest single-occupier logistics park.
The scheme should be completed by September 2022. Work has been ongoing at the Leicestershire logistics park site since September 2020. The 238-acre site is expected togo from zero to development in four years, compared to the usual five-to-ten period for this sort of project.
The total project value is £270m.
Amazon announces $100m Mexican investment
Amazon has announced a $100m logistics investment in Mexico, focusing on its first shipping centres away from the heavily populated capital city area.
Two new fulfilment centres will be built near the northern city of Monterrey and the central city of Guadalajara. These two cities are the biggest metropolitan areas in the country after Mexico City. The company will also build support buildings in the State of Mexico, outside of Mexico City.
Amazon now has a total of 27 delivery stations across the country, following the recent opening of 12. It has five fulfilment centres, two support buildings and two classification centres in Mexico, following its move into the country in 2015.
The Monterrey and Guadalajara facilities represent 69,000 sq m altogether and are likely to create 1500 both direct and indirect jobs.
Amazon is also seeking to make further inroads in Brazil. It recently opened its fifth and largest fulfilment centre in the country at 100,00 sq m. In both Brazil and Mexico, Amazon is fighting local rivals for customer loyalty.
Panattoni to build five UK speculative warehousing projects
Industrial developer Panattoni has signed up Winvic Construction to build five speculative industrial warehouse projects – three sheds at Panattoni Park Northampton, one at Crewe Commercial Park and one at Derby Commercial Park.
Work will begin at the Crewe site in April this year, while work has already started at the Derby site to deliver a 480,000 sq ft cross dock industrial warehouse.
Panattoni is also to build a 515,000 sq ft warehouse, one of the largest of its type, in the Derby Commercial Park. The location of the site gives good access to East Midlands Airport and a large workforce in the Derby area.
Panattoni has also acquired outline permission to deliver a 1.9m sq ft warehousing and distribution space in Kent on the site formerly owned by Aylesford Newsprint. The 90-acre site will cost £180m to develop, including a new £7m link road and will be the company’s largest UK development to date. The permission allows Panettoni to build a single unit up to 1.2m sq ft alongside other units. The remaining space will be built to specific client needs and subject to detailed planning application.
Sergo redevelops 239,665 west London site
Sergo has started work on the former Nestle chocolate and coffee factory in west London. The site will house four warehouse properties totalling 239,665 sq feet at the Hayes, Middlesex, site.
A 100,000 sq ft site has already been pre-let to an undisclosed firm.
The remainder of the 30-acre site will be used for more than 1300 new residential buildings built by Barratt.
Panattoni to develop former Swindon Honda site
UK developer Panattoni will take over the former Honda car manufacturing site in Swindon, UK, pledging to spend £700m on the site from spring 2022.
Rumours have been circling that Amazon is interested in the site once it has been redeveloped for logistics purposes.
Florida’s Wish Farms moves into 125,000 sq ft sustainable warehouse
Wish Farms, year-round berry grower and shipper based in Plant City, Florida, has a new sustainable 125,000 sq ft warehouse on 36 acres of property. It is situated off Interstate 4 on the main highway that intersects central Florida east to west.
The site has a 20,000 sq ft solar array which the company hopes will save 10,000 tons of carbon dioxide over the lifespan of the system.
Fiera Real Estate acquires 207,383 sq ft Hertfordshire, UK, site
A new 8.5-acre logistics site in Bishop’s Stortford, Hertfordshire, UK, has been acquired by Fiera Real Estate (FRE UK) and Wrenbridge.
A 207,383 sq ft scheme across seven units in four buildings, with units ranging in size from 12,357 sq ft to 62,863 sq ft, will be developed.
The larger units will have surface level and dock level loading doors and self-contained service yards.
The site will also house 750 new homes, new schools, a local centre and employment space. It is situated on urban expansion land to the south of the town and is close to the M11 and wider road network.
VF Corp to build 600,00 sq ft Leicestershire (UK) fulfilment centre
Clothing and footwear company, VF Corp, has started work on its new 600,000 sq ft fulfilment centre in Bardon, Leicestershire, UK. Up to250 people will be employed there during peak periods.
It is envisaged that nearly 90% of the centre’s market will be able to be served within one day. The centre will have capacity for 200,000 units per day, with an additional 18 stations providing capacity to pick 170,000 units per day.
Green technologies will be incorporated into the centre, as well as features focusing on staff welfare, including an on-site canteen and gym. The new site builds on VF Corp’s UK investment in the last two years, where the company launched a new business hub and brand new flagship stores for Timberland and Vans in London. The company also owns The North Face and Supreme.
VF Corp has 90 owned and operated stores across the UK employing 1800 people, seven offices and two distribution centres.
Amazon builds £30m Hull (UK) delivery centre
A £30m delivery centre is to be built for Amazon at Melton West, on the outskirts of Hull, UK. The site will have a 10,000 sq m base.
Focusing on last-mile parcel handing, the centre is expected to be operational this summer. The site is next to another large development which has been speculatively identified as an Amazon regional hub.
Agility Logistics opens 290,000sq m Mozambique logistics park
Leading global logistics and warehouse provider, Agility Logistics, has opened a 290,000 sq m Agility Logistics Park on the new Maputo ring road in Mozambique. This gives the company easy access markets in northern Mozambique and to South Africa.
In the first phase of development, a 32,000 sq m eco-friendly warehouse, built to international standards, is available to lease by both local or multinational companies.
CEO of Agility Africa, Geoffrey White, says the building of international-standard warehouses in Africa is “one of the fundamental building blocks necessary for economic growth”.
Agility is developing a network of warehouse parks across key African markets. Other parks are located in Ghana, Cote D’Ivoire and Nigeria.
Kering moves to complete global hub in Northern Italy
Luxury fashion conglomerate, Kering, has reported the completion of the first phase of a new global logistics hub in Northern Italy. A second 100,00 sq m building will be operational by the end of the second quarter 2021. In total, the France-headquartered conglomerate has more than 162,000 sq m of logistics space.
The new hub will ship up to 80m pieces per annum and store up to 20m pieces. Lead times are expected to be slashed by 50%.
The company aims to become fully omnichannel by transforming its worldwide logistics network.
Bid for half a million sq ft of Midlands, UK, warehousing space
Planning application has been made for the Wellington Business Park in Market Harborough, UK. Forming part of the wider Market Harborough Strategic Development Area, the site has been allocated for mixed usage, including offices, industrial and warehousing.
The site could potentially offer up to 500,000 sq ft of space with individual build-to-suit industrial/warehouse units ranging in size from 10,000 sq ft to 100,000 sq ft.
Property agents, Prop-Search, has been appointed sole agent to market the new park.
DSV ready to sell new 1m sq ft Texas site
Danish-based logistics firm DSV’s 1m sq ft international centre in Lancaster, Texas, USA, is already on the market, even though it is not expected to open until later in 2021. The site will also offer 50,000 sq ft of office space.
A number of companies are launching industrial developments in the southern Dallas County which has good access to the I20 and I45 corridors. Almost 1.2m sq ft of net leasing has been arranged in the first quarter of 2021 in the area. Nearly 6m sq ft of new industrial space is currently under construction in the area. In Dallas-Fort Worth, almost 25m sq ft of warehousing and distribution units are under construction. This is the USA’s fastest-growing warehouse market.
Amazon is likely contender for 625,000sq ft Hampshire, UK, site.
Planning approval has been given by Basingstoke Council in Hampshire, UK, for a controversial 2.3m sq ft warehouse, reported but not confirmed to be for Amazon.
The site is just off Junction 7 of the M3 motorway. The £120m distribution centre will have a 625,000 sq ft footplate with three mezzanine floors of 547,000 sq ft. The total site will cover 2,327 sq ft.
There were numerous objections to the planning application but the council voted in favour, citing employment opportunities
The site will be run on a 24/7 basis and will be highly automated. It will have 64 dock level doors on two sides.
SEGRO builds 220,000 sq ft speculative East Midlands, UK, warehousing
A 220,000 sq ft speculative warehouse is being built at the SEGRO Logistics Park East Midlands Gateway, UK. Ready for occupation in October 2021, the warehouse will be just north of Castle Donington airport.
The site has its own rail freight interchange and is within a recently appointed freeport area, giving tax and planning incentives for companies. The site will be nearly 75% full once this speculative build is finished. 1.5m sq ft of space will remain for new customers.
Amazon has finally confirmed the opening of a new fulfilment centre in Gateshead, North-East England after months of speculation
The new centre will be located in the Follingsby Park area near Leam Lane, serving customers in the Gateshead and Tyneside area. It is expected to be fully operational by summer 2021.
The company opened fulfilment centres at nearby Darlington's Symmetry Park and Bowburn's Integra 61 industrial estate, near Durham, last year.
A brand-new delivery station also owned by Amazon has been built next door to the new warehouse which is expected to open by Summer. This smaller centre, which will see parcels arrive from neighbouring fulfilment centres, is expected to speed up deliveries locally.
There is also talk of a similar site designated for Teeside. In November last year, it was reported that a warehouse of similar size to the one in Darlington is planned for Wynyard, near Stockton. Plans submitted to the local council said the site was expected to be operational in September 2022.
Urban Logistics buys 375,000 sq ft of planned warehousing in UK’s Midlands
Property investment company Urban Logistics REIT (ULR) is buying 10 proposed sheds in Nottingham, Leicester, Castle Donington, near East Midlands Airport, and Rochdale, UK, in a £40m deal.
The deal will give Urban Logistics a total of 375,000 sq ft of planned warehousing with units ranging in size from 18,000 sq ft to 81,100 sq ft.
The deal gives Urban Logistics the option to purchase a second package of five further warehouses later this year.
The buildings at Blenheim Park in Nottingham and Optimus Point in Leicester will be completed and ready for occupation by the summer of 2022.
ULR has recognised demand within the mid-sized market sector and has therefore targeted the delivery of units in strategic locations in sizes ranging from 20,000 sq ft to 200,000 sq ft.
366,000 sq ft warehouse for Redditch Gateway site
Stoford is to build a new 366,000 sq ft warehouse building north of the Redditch Gateway site which is near Junction 3 of the M42, in collaboration with Royal London Asset Management.
One million sq ft of office, logistics and manufacturing space will be available at the 78-acre site, with capacity for two additional build-to-suit units of between 150000 sq ft and 250,000 sq ft. The Gateway site is in a strategically important part of the West Midlands (UK) region.
Stoford will be the development partner for the project and will work with landowners, The Gorcott Trust and Homes England.
Katoen Natie announces £61m 243,00 sq ft Norfolk, Virginia, facility
A plastics and polymers warehousing and distribution company is to expand its operation in Norfolk, Virginia. Katoen Natie Norforlk Inc. is a subsidiary of Katoen Natie, the Belgian logistics service provider.
The company plans to invest $61m and create 35 jobs. It will now add a 243,000 sq ft warehouse and rail facility to the former Ford Motor Co. site it moved into in 2011 on Springfield Avenue.
The City of Norfolk worked in partnership with the Virginia Economic Development Partnership, the Hampton Roads Alliance and the Port of Virginia to secure the project, fighting off competition from Georgia, Maryland and South Carolina.
ELI constructs 100,000 sq m Silesian warehouse
European Logistics Investment (ELI) has begun construction of a two-building, 100,000 sq m warehouse scheme in Park Tychy, Silesia, Poland. The new buildings will be sustainable and energy-efficient.
One building will have 58,000 sq m of warehouse space and the second will have 37,000 sq m of warehouse. The first building has already been fully pre-let on a long-term lease. Building work should complete in 2021.
Park Tychy is situated in a booming area for warehousing close to the city of Tychy, providing a highly qualified workforce and excellent transport connectivity, including easy access to the A4, A1 and S1 motorways.
ELI is working with Panattoni, its strategic partner in logistics developments.
Amazon expected to build Halifax, Canada, warehouse
It is believed Amazon is set to build a warehouse and distribution centre at 180 Thornhill Drive, in Dartmouth, Halifax, Canada. A renovation permit has been approved and a demolition permit is under review, having been submitted under the name of Aecom, a Halifax-based engineering consulting firm.
The official deed, dated 29 March 2021, confirms that Amazon Canada Fulfillment Services now owns the building, valued at $3,961,300. Amazon, itself, has yet to confirm or deny its intentions.
Halifax had previously put in a bid to become the site of Amazon’s second North American headquarters but was eventually outbid by Arlington, Virginia, USA.
Startup Saltbox creates ‘co-warehousing’ haven for small businesses
Saltbox, which started business in 2019 in Atlanta, USA, identified the need for ‘co-warehousing’, providing space in which small businesses and e-commerce merchants can operate, store and ship goods, all under one roof.
The company also offers an integrated logistics service and provides equipment on a rental basis. Clients do not sign leases and can easily scale up or down depending on their needs, giving them an unusual degree of flexibility.
The company’s first facility was a 27,000 sq ft location which it managed to fill with clients within two months. A second 66,000 sq ft site in the Dallas-Fort Worth areas has just been opened. This is currently 40% occupied.
Tyler Scriven, Maxwell Bonnie and Paul D’Arrigo, co-founders, would like to have a total of eight locations by the end of 2021. They are particularly interested in Denver, Seattle and Los Angeles. The company plans to have locations as large as 110,000 sq ft.
Snapshot from Savills
More than 50m sq ft of new space was leased in the UK in 2020. This was an increase of 12m sq ft on the previous record year in 2016.
Amazon took up 25% of all new space leased in the UK.
Short-term leases of five years or less accounted for 12% of all new warehouse space taken.
Grocery, multichannel and pureplay accounted for 21.3m sq ft of the 50.5m sq ft leased. (73)
Buy It Direct does deal for 525,000 East Midlands, UK, site
Buy It Direct Group has signed a deal for a new 525,000 sq ft facility at EMDC, close to East Midlands Airport.
The company already has a warehouse at nearby Mansfield so the existing ops team can manage the new site.
The 18m-high site will provide the company with an extra 90,000 pallets for appliances, bathroom products and furniture.
The shed is expected to reach capacity within 4 years but until then it will provide the company with excess space to offer a pick, pack and despatch to third parties, particularly for oversized goods.
Brooklyn Navy Yard development transforms former shipbuilding warehouse into ‘smart factory’
Brooklyn Navy Yard Development Corporation, Nanotronics & New York State have opened a manufacturing center located in the Navy yard’s historic Building 20, a 150-year-old former shipbuilding factory.
Nanotronics, a science technology company that combines AI, automation and sophisticated imaging to manufacture hardware and software capable of working on a nanometer scale, will use the new 45,000-square-foot building as its headquarters.
The opening reinforces the Navy Yard’s mission to anchor the rebirth of urban manufacturing, create sustainable urban manufacturing jobs and grow the modern industrial sector in New York City.
The project was primarily funded through $3.25 million from the City of New York and a $2.25 million Regional Economic Development Council capital grant through ESD in exchange for a commitment of 190 jobs.
Organic Garage finalises transition to a decentralised distribution model
Organic Garage Ltd., one of Canada’s leading independent organic grocers, has announced that it has finalised the closing of its distribution and warehouse facility, moving to a fully decentralised distribution model.
The cost savings from the transition are expected to exceed $1million annually.
Organic Garage had originally adopted a hub-and-spoke model where the centralized distribution facility was to service its group of stores. With the new model, the company anticipates further benefits to gross margins as a result of its ability to leverage its distributors’ logistics at their cost.
W.P Carey announces $67 Million in industrial investments
W. P. Carey Inc. have announced two industrial investments totalling $67 million and covering approximately 580,600 sq ft.
These include a $53 million acquisition of a 487,600 sq ft logistics site comprising two high-quality buildings net leased to Comprehensive Logistics, a leading third-party logistics provider for the automotive and other industrial industries. This site is located in a supply-constrained submarket of Detroit, and in close proximity to both Ford's largest production plant and the I-75 highway. This site comprises of two buildings.
The second site is a $14 million, 93,000 sq ft food production and distribution site net leased to one of the largest ice cream and beverage brands in the U.S.
Bushu Pharma expand gateway to Asia with new distribution facility
Bushu Pharmaceuticals Ltd has established the Bushu Pharma Kazo Packaging Centre located within the Kazo Pharmaceuticals Joint Distribution Centre of Chuo Unyu Company to carry out inspection, labelling, packaging and storage of pharmaceutical products.
The centre is scheduled to start operations in the summer of 2021.
The site is located at 37-3 Kitatsuji, Kazo City, Saitama Prefecture, and has a refrigerated warehouse that can store 634 pallets, a room temperature warehouse holding 648 pallets.
New warehouse development to be built in Milton Keynes, UK
A state-of-the art warehouse park is to be built on the edge of Willen Lake, by developer and investor GLP. They will demolish an existing warehouse on the site because it is "outdated".
GLP, which runs Magna Park in MK, say the move follows the acceleration of e-commerce, which has led to a surge in demand for logistics real estate.
The site will be called G-Park, and will be made up of two units totalling 254,859 sq ft on the 13.2 acre site.
Boohoo secures extra warehouse space to drive sales growth
The fast-fashion firm has said it has secured a long-term lease for a new warehouse in Daventry, UK, which will become operational in the second quarter of its financial year.
The new warehouse space, in addition to its existing sites in Burnley, Sheffield and Wellingborough, will give the group a net sales capacity of more than £4bn.
Boohoo said it expects to invest more than £50m in the site over the coming years to increase capacity.
The deal will create up to 500 jobs, with the possibility of a further 1,000 jobs as capacity increases.
Henry Boot to build massive warehouse in Wakefield
Construction and property firm Henry Boot has gained planning permission to build a massive 2m sq ft distribution warehouse in Wakefield.
The work will include building a new spine road through the scheme and extensive landscaping. Once completed it is expected that the warehouse will lead to the creation of around 1,500 jobs.
The new warehouse will sit within Wakefield Hub, a 200-acre industrial and logistics scheme, which has been designed to be a prime location for manufacturers and logistic firms. The site offers good access to the M62, M1 and A1 and is one of the largest regeneration projects of its kind in the UK.