When Walmart built one of the region’s first big distribution centers in Fulton County more than 20 years ago, other firms were eager to settle nearby to provide ancillary services, such as trucking, to the retail giant.
Now, with e-commerce juggernaut Amazon said to be planning a huge warehouse operation in Rensselaer County, other firms are taking note, but their interest this time is different, says Richard Sleasman, president and managing director of the Albany office of commercial real estate firm CBRE.
The firms aren’t looking to be close by to service the yet-to-be-built fulfillment center.
Instead, they are taking a cue from Amazon on where to set up their own warehouses. “You absolutely will see new interest,” says Sleasman. “Amazon is the trendsetter.”
He said our proximity to markets in the Northeast is a big draw, as e-comm firms look to be close to consumers. Brick-and-mortar retailers, on the other hand, try to be close to their stores.
“Our area is seeing more demand for [warehouse] big boxes,” Sleasman said.
We also have the room: The expected 1 million-square-foot Amazon facility would be built in Schodack, in rural Rensselaer County, just as open acreage in Saratoga, Fulton and Montgomery counties drew Target, Ace and others. The Target and Ace warehouses top 1 million square feet each.
Sleasman noted, too, that the swiftness with which the Amazon plans passed municipal muster – even while prompting an environmental lawsuit from neighbors – can catch the attention of companies needing to move fast.
The consumer appetite for next-day or same-day delivery is pushing firms toward bigger facilities that can provide last-mile, to-the-door service for online orders, the trade publication Logistics Management reported in July.
High demand for warehousing has pushed vacancy rates for existing space to historical lows, and has spurred a “strong pipeline” of new construction, the magazine quoted commercial real estate firms as saying.
And while Amazon may be the most identifiable user, the publication said traditional retailers shifting to a larger online presence need more warehouse space as their stores evolve into “see and touch” showrooms while the bulk of business occurs via the Internet.
Says Sleasman, “Amazon has redefined the last mile for big box.”
He said CBRE-Albany now has a half-dozen commercial land listings in Rensselaer County that are located within a few miles of the Amazon site on Route 9 in Schodack.
They range in size from under 10 acres to more than 100, and are priced up to nearly $4 million. Most mention the nearby Amazon site.
Only one of the listings involves a long-time client; the others are new and “clearly came in due to Amazon,” Sleasman said.
The listings have prompted some inquiries, he added, but while declining to identify anyone, said they involved “mega retailers” interested in proximity to population centers.
Marlene Kennedy is a freelance columnist. Opinions expressed in her column are her own and not necessarily the newspaper’s. Reach her at [email protected]