New England for the same reason these
facilities are proliferating elsewhere in
the country, the need to get closer to the
customer.”
Indeed, most of these distribution facilities, whether in western Massachusetts
or in Phoenix, are retail fulfillment or
internet-retail fulfillment. That’s because the retailer wants to be in closer
proximity for restocking stores or to get
goods into householder hands.
There is an evolution to big-box distribution and parts of the country where
the 200,000-square-foot facility was
once considered top of the market are
now getting the 700,000-square- foot or
million-square-foot distribution building.
A 200,000-square-foot distribution
would have been considered a real coup
for a New England broker until about
six years ago when, around the city of
Windsor, Conn., Walgreens opened a
million-square-foot facility. It was followed by Dollar Tree, and more recently,
Amazon. In addition, there has been an
uptick in build-to-suits for such companies as Tire Rack, Hyundai Mobis, and
Performance Food Group.
Companies are choosing northwestern
Connecticut and western Massachusetts
for a number of reasons. First, shipping
goods to New England is not as easy as
you might think because if the product
comes by rail or road it has to cross
the Hudson River and there are not
many bridges. In addition, the traffic is
usually immense. To get better distribution in New England, the northwestern
and western parts of Connecticut and
Massachusetts are closer to the rest of
the country and the area is within a one
day’s drive to the rest of New England.
A driver can get from Hartford to Bar
Harbor, Maine, in a trucker’s day.
Although there might be some distribution into upstate New York, these
centers do not distribute 360 degrees.
They are meant to distribute solely to
New England. Secondly, unlike the congested Boston or southern Connecticut
area, there is plenty of land in northwestern Connecticut and western
Massachusetts. The land is cheaper
than those other areas, as are rents.
“What might cost you $4.75 or $5.50 a
square foot for a lease here would run
you $7 to $8 a square foot outside of
Boston – and the wages are higher in
Boston,” says Lescalleet.
The spread of the big box distribution
center from the usual hubs of Los
Angeles, Chicago, New Jersey, or Dallas
is not the only factor that will change
certain specific industrial markets in
the country.
Trends sometimes arise from the solving of a particular problem.
Most goods from Asia arrive in the
United States through West Coast
ports, the largest being the one at Long
Beach/Los Angeles. In recent years,
longshoreman strikes at these ports
have kept container ships backed up
in the Pacific Ocean for as long as a
hundred miles. The smaller container
ships could enter the Panama Canal and
eventually unload at ports on the East
Coast. Those that did, continue to do so.
Meanwhile, the Panama Canal is in the
process of expanding to make room for
the large container ships, and when that
is completed there will be a boom at the
bigger East Coast ports such as Miami,
Jacksonville, and some might say, most
importantly, at Savannah.
“If only 10 percent of the shipping that
is received at Long Beach is diverted to
the eastern seaboard, all of our ports
will be inundated with business that
they can’t handle – that’s how much
At first glance, the average industrial building seems like a consistent,
non-descript, mundane product. New
structures might look prettier or bigger,
but the basic box doesn’t change that
much.
That’s only partially true; the industrial
product has evolved over the past three
decades; not only structurally, but as
anyone in the commercial brokerage
business knows, new locations suddenly become hot, while older venues
for manufacturing or warehousing die
out. Sometimes a region might clock
through numerous cycles, up, then
down, then miraculously up again.
So, the reliable industrial markets, and
the buildings we erect in those markets,
evolve or devolve over time, and industrial brokers have to spot the trends.
Tim Lescalleet, primary delegate,
a senior vice president with Griffin
Industrial LLC in Hartford, Conn., works
an area of New England, that includes
northwestern Connecticut and western
Massachusetts. Except for Hartford,
there are not a lot of big cities in the
area, which might be considered a good
thing because this region has suddenly
been tacked onto the map of internet
and hard-goods retailers looking for
distribution into New England.
Although there are some major population centers in New England, particularly
the Boston region, New England sits
in the northeast corner of the country
and was not considered a good area for
large scale distribution operations. Over
the past half-decade, that kind of thinking has changed and Big Box America
has begun to migrate to the region.
“The types of buildings you would see
in other major industrial/distribution
nodes are now coming to New England,”
says Lescalleet. “They are coming to
