Tag Archive for: e-commerce fulfillment space

Here Are South Florida’s Biggest Industrial Leases Of 2022

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Bigger is better when it comes to South Florida industrial leases.

Across Miami-Dade, Palm Beach and Broward counties, major retailers and shipping services like Target and FedEx leased 2.8 million square feet of industrial space in the largest leases of 2022, far outstripping last year’s total of 2.2 million square feet.

Amazon was notably absent from this year’s roundup of the top 10 leases. The e-commerce giant clinched three of the top 10 spots last year. In May, news broke that Amazon sought to sublease at least 10 million square feet of its existing space — a reversal from its pandemic-era practice of gobbling up as much space as possible.

The average lease size of the top five leases this year came to 362,000 square feet, which is above last year’s 258,530 square feet, but still below 2019’s average of 449,000 square feet.

Here’s a breakdown of the top five industrial leases signed this year in South Florida.

Imperial Bag & Co., Hialeah, 506K sf

Five out of the top 10 largest leases were inked for properties in Hialeah, with New Jersey-based Imperial Bag & Paper Co. (ImperialDade) taking the top spot, both in Hialeah and overall. In the second quarter, company representatives signed a lease for 506,000 square feet at Countyline Corporate Park on Northwest 102nd Avenue in Hialeah. The company distributes janitorial supplies and food service packaging.

FedEx Ground Package System, Medley, 501K sf

FedEx leased 501,000 square feet in Medley in the first quarter. It’s the only non-Hialeah lease in the top five. The shipping behemoth took over one of the warehouses at Miami 27 Business Park at 10300 Northwest 121st Way, according to published reports. FedEx has long been interested in South Florida industrial properties. Last year, Industrial Outdoor Ventures outbid FedEx for the 38.5-acre site at 3055 Burris Road in Miami. The winning bid was $64M.

FreezPak Logistics, Hialeah, 312K sf

FreezPak Logistics took this year’s third largest lease at the same Countyline Corporate Park in Hialeah as Imperial Bag & Co. It signed a lease for 312,000 square feet in March. This is the first South Florida location for the New Jersey-based cold and dry-storage provider.

World Electric/Sonepar, Hialeah, 267K sf

In the fourth spot, World Electric leased 266,760 square feet at Beacon Logistics Park at 4220 West 91st Place in Hialeah during the first quarter. A subsidiary of South Carolina-based Sonepar, North Miami Beach-based World Electric in September announced it inked a deal to acquire Advance Electrical to increase the company’s presence in Atlanta. The company specializes in business-to-business electrical services and equipment.

All Florida Paper, Hialeah, 227K sf

Medley-based All Florida Paper signed the fifth largest lease of the year, during the third quarter. It took 227,700 square feet at Beacon Logistics Park at 4120 West 91st Place in Hialeah. All Florida Paper is a wholesale distributor founded in 1993, according to the company’s website.

 

Source: The Real Deal

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Industrial Cap Rates Expected To Rise But Outlook For Seasoned Investors Remains Strong

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Industrial has been on quite a tear over the past few years, as changes in consumer behavior have driven demand for more logistics and fulfillment facilities in key markets.

And according to one industry expert, the sector should stay a favored asset class for experienced investors, despite rising capital costs.

“Post-pandemic consumer behavior has changed and the rate of growth in ecommerce has slowed which has already led to pullbacks by some companies,” says Greg Burns, Managing Director at Stonebriar Commercial Finance, noting Amazon’s recent announcements regarding its industrial portfolio. “Demand for industrial though was driven by other factors as well including a move toward onshoring and the disruption of just in time supply chains.”

With that said, however, Burns said “depending on the what and the where, I would not be surprised to see cap rates widen another 50 to 100 basis points.”

“The cost of debt and equity capital have increased and cap rate hurdles have increased for institutional buyers,” Burns says, adding that he recently saw an increase of 100 basis points in an appraisal for a property in a market where his firm closed a deal six months ago.

Burns will discuss what’s happening in the capital markets in a session at next month’s GlobeSt Industrial conference in Scottsdale, Ariz. He says Stonebriar’s definition of industrial includes not just warehouse and distribution facilities, but manufacturing, life sciences, cold storage and data centers as well, and notes that “each of those sub-categories have their own dynamic and, broadly, all are growing.”

“We prefer properties with multi-modal access, especially those near ports, with most opportunities we’ve seen recently being to the southeast of a line drawn from Baltimore to Phoenix,” Burns says. “We also pay attention to outdoor storage capacity as that has become a greater consideration for tenants. There have been several announcements of new manufacturing sites relating to microchip and electric vehicles which should lead to demand for new logistics properties nearby.”

As the costs of debt capital rise, Burns says Stonebriar’s underwriting will continue to focus on the sponsor, asset and market and “that won’t change.”

“We do few spec development deals and will likely be more granular on understanding the demand/supply side of a respective market,” Burns says.

Ultimately, a recession seems likely and Burns says the changing economic landscape will have “varying impacts” on investors and individual markets alike.

“From our perspective, there will be a premium on a sponsor’s experience and capacity,” Burns says. “I anticipate industrial will remain a favored asset class for investors although those with less experience in the sector could pull back until the economy recovers.”

 

Source: GlobeSt.

 

Festival Flea Market Could Be Demolished. Here’s What Would Replace It

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The owner of the Festival Flea Market in Pompano Beach wants to demolish the building and sell the property to an industrial developer.

The city’s Development Review Committee on March 16 will consider land use amendment and rezoning applications for the 23.8-acre site at 2900 W. Sample Road. It’s owned by Festival Real Estate LLC, an affiliate of North Miami-based IMC Equity Group, but the application says it’s under contract to Atlanta-based industrial giant IDI Logistics.

The property currently has a 382,000-square-foot commercial flea market, which was built in 1986 and is used by multiple small vendors. It’s near a Florida’s Turnpike exit. The flea market would be replaced with about 773,000 square feet of industrial space. The developer has yet to submit a detailed site plan.

IMC Equity Group acquired the property for $56 million in 2018 and initially spoke about revitalizing the flea market. In November 2021, it sold a parking lot south of the flea market to an industrial developer after it was approved for warehouses.

 

Source: SFBJ

Developers Obtain $41M Loan To Build Warehouses In Lake Park

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A group of developers obtained a $40.78 million construction loan to start work on a large industrial project in Lake Park.

Wells Fargo Bank provided the mortgage to ASVRF Silver Beach Road LLC, a partnership between Los Angeles-based American Realty Advisors, Atlanta-based Ridgeline Property Group, and Fort Lauderdale-based Mitchell Property Realty. It covers the 24.2-acre property located at 1600 Silver Beach Road, just east of Congress Avenue.

Called Silver Beach Industrial Park, the project will total 380,000 square feet in four buildings with 32-foot clear ceiling height.

CBRE’s Robert Smith, the leasing broker for the project, said it will break ground in December.

 

Source: SFBJ

Amazon Opening “Last-Mile” Distribution Center In Coral Springs

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Amazon is opening a 250,000-square-foot warehouse facility in Coral Springs to serve as a “last-mile” distribution center for the city and surrounding communities, according to Coral Springs officials.

The new center will provide 200 full-time jobs. It will be in the city’s Commerce Park, leasing space in the Exeter Property Group facility.

Amazon also purchased $3.5 million property in the south end of the corporate park to be used for truck parking and employee parking.

“Business expansion and job creation are essential to the growth and vibrancy of the City of Coral Springs and the reason we are excited to welcome Amazon to our Commerce Park,” Coral Springs Mayor Scott Brook said in a statement. “The creation of 200 full-time, diverse jobs in a post-pandemic climate is the boost we needed to jump start a stronger economy long term.”

Amazon has been expanding operations across South Florida as part of its efforts to get products faster to customers. In Tamarac, the global e-commerce giant is opening a same-day fulfillment center in the city’s industrial zone with the goal of delivering items to customers within about five hours, city officials said.

Brook added: “Their move to the newly built 250,000 square foot warehouse facility, is a strong signal to other large employers and industry leaders the benefits of our city’s location to the Sawgrass Expressway and connectivity to neighboring communities.”

Brook credited Greater Fort Lauderdale Alliance in working with city staff to help bring Amazon to Coral Springs.

It’s not clear yet when the new facility will open. Amazon could not be reached for comment.

Source: TapInto

Largest Chunk Of Undeveloped Land Owned by Broward Up For Grabs

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One of the largest chunks of undeveloped land owned by Broward County is up for grabs.

“It’s probably one of the few areas that we still have in Broward County with acreage that’s not developed,” says County Commissioner Dr. Barbara Sharief.

The piece of land a hot ticket item for some. It’s 61 acres located near U.S. 27 and Sheridan Street in Pembroke Pines. E-commerce giant Amazon could now be the one to take over the land – if they still want it.

“I think it’s time to move onto the second rank vendor, which is Amazon,” said Sharief.

The county’s second choice is now the county’s number one. It had been Amazon’s idea to build on the land. In 2020, county commissioners decided for Vital Pharmaceuticals, which makes the energy drink Bang, to win the land instead. Sharief explains Vital was ranked above Amazon because they ensured a median salary of $62,000 to their employees, which the company eventually retracted.

“As we’ve gone through the process, they came back and said that was erroneously calculated, but we want to still do the deal and it just kept on dragging on, so at this point, I’m frustrated,” Sharief said.

The deal fell apart and now, the county wants Amazon. Now, it’s the waiting game to see what happens next.

“Amazon provides health care, they provide a decent wage and I feel like that’s two of the things people are looking for coming off of COVID. So, it really makes perfect sense to try to get Amazon to take this on,” said Sharief.

If Amazon were to build on the site, it would be one of its biggest projects. They would employ more than 1,000 people and the facility would support the entire delivery network throughout North America, housing household and consumer goods.

 

Source: NBC 6 South Florida News

Tiny Village Of Golf Rejects Amazon’s Plan To Build Last-Mile Center; Rare Rebuff For Retail Giant

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There will be no Amazon facility in the Village of Golf.

The Village Council just voted 4-1 to deny Amazon’s request to build a $25 million last-mile distribution facility on 17 acres at the southeast corner of Woolbright Road and Military Trail west of Boynton Beach.Its staff concluded the project “is not in keeping with the quality of life” within the village, home to about 300 people.

The vote, on a zoning change that would have permitted the Amazon facility, came at the end of a five-hour meeting. Tom Lynch cast the sole vote in support of Amazon. The rejection represents a rare rebuff for the e-commerce giant, which has generally been welcomed into communities for the jobs it creates and the extra taxes its buildings generate. The Village of Golf project was expected to generate more than $400,000 in annual local, school and county taxes.

Opponents Say Centers Such As One Proposed By Amazon Belong In Industrial Parks

Amazon’s last-mile delivery stations are the final stops prior to direct delivery to customers. They are much smaller than the fulfillment networks that are often 1 million square feet and are comprised of state-of-the-art technology to support processing customer orders.

In October, Amazon opened a 96,000-square-foot last-mile warehouse west of West Palm Beach. And it expects to build much larger fulfillment centers in suburban Jupiter and Boca Raton.

The argument that the proposed Golf site was too close to residential areas resonated with village council members, as critics claimed these types of facilities belong in industrial parks.

Current zoning in the village permits seven separate warehouses on the site, totaling more than 100,000 square feet. Amazon was looking to change that zoning to permit a taller, single 72,000 square-foot building.

There was intense opposition from residents within the Village of Golf itself and nearby Delray Dunes Golf & Country Club, which hired its own experts to testify against the zoning change.

Amazon attorney Harvey Oyer noted that numerous concessions were made to address issues that area residents had raised. The building height was lowered, and the building was redesigned at great expense to reduce impacts on Quail Ridge, the community most impacted. The changes were enough to gain the support of the golf-course community. And to sweeten the pot, Oyer said his client was prepared to deed over a 2.3-acre site on the parcel to the village, a donation worth more than $2 million.

But one resident said, in response: “You put lipstick on a pig, it is still a pig. This is an industrial warehouse in my back yard. This is not suitable in a residential area.”

Developer Plans To Build Seven Separate Warehouses On 17-Acre Site

The village staff expressed concern over Golf’s ability to withstand legal challenges from Amazon if, in the future, Amazon should ever sue over agreements negotiated between it and the village.

Village Manager Christine Thrower-Skinner has previously questioned what might happen if Amazon ever relocated from the Village of Golf site.

“The Village would be stuck with an empty single-purpose build with a limited opportunity for reuse,”  Thrower-Skinner said.

Steve Mackey, the developer who owns the land, said he will now move ahead with  plans to bring the seven warehouses permitted under village zoning to the property. He said he believes the Amazon plan would have been more appropriate for the site.

Oyer argued that the seven-warehouse plan will result in even greater density and more traffic than the last mile-distribution facility, whose trucks would enter and exit during non-rush hour periods.  He questioned the criticism that the village does not have the resources to withstand a legal challenge from Amazon.

“What about Publix or other corporate entities? Is if fair to single out Amazon?” Oyer said.

 

Source: Palm Beach Post