by Josh Bays, on Apr 22, 2020 10:09:57 AM
Note from the author: This research contained in this trend report does not reflect the full effect of the COVID-19 pandemic. Site Selection Group anticipates those trends to become more apparent in second quarter data.
Site Selection Group, a full-service location advisory, real estate and economic incentive services firm closely monitors national distribution center investment activity, as well as trends related to real estate, economic incentives and workforce. During the first quarter of 2020, announced distribution center activity in the United States created an estimated 14,403 jobs at 133 facilities by well-known companies such as Amazon.com, The Home Depot, Kroger and Johnson & Johnson. The table below shows several notable announcements.
Notable Distribution Center Announcements
| Company | Metro Area | Capital Investment ($M USD) | # of Jobs |
|---|---|---|---|
| Amazon.com Inc. | Virginia Beach, VA | $4.0 | 1,000 |
| The Home Depot Inc. | Dallas, TX | $1.1 | 800 |
| Ferrara Candy Co. | Chicago, IL | $100.0 | 500 |
| The Kroger Co. | Washington, DC | $55.0 | 400 |
| Johnson & Johnson | Indianapolis, IN | $110.0 | 300 |
| Lidl Us LLC | Atlanta, GA | $100.0 | 270 |
| SiCar Farms Ltd. & Co. | McAllen, TX | $12.0 | 250 |
| Lowe's Companies Inc. | Spartanburg, SC | $100.0 | 150 |
| Medline Industries Inc. | Savannah, GA | $70.0 | 150 |
| Whirlpool Corp. | Tulsa, OK | $55.0 | 150 |
| Wastequip LLC | Tyler, TX | $6.0 | 130 |
| Newell Brands Inc. | Shelbyville, IN | $11.0 | 115 |
| KaTom Restaurant Supply Inc. | Sevierville, TN | $12.6 | 100 |
| ST Engineering Halter Marine and Offshore Inc. | Gulfport, MS | $10.0 | 100 |
| Wastequip LLC | Mount Sterling, KY | $7.3 | 100 |
| Abl Wholesale Distributors Inc. | Salem, OH | $13.9 | 83 |
| DOT Foods Inc. | Lake Havasu City, AZ | $12.0 | 70 |
| Allegiant Travel Co. | Charlotte, NC | $50.0 | 66 |
| AXIS Logistica S.A. | Jacksonville, FL | $15.0 | 60 |
| Gulfstream Aerospace Corp. | Dallas, TX | $35.0 | 50 |
Source: Conway Analytics
Larger markets remained active
Over the past quarter, distribution center operators have announced projects all across the country. There was substantial activity in larger markets like Southern California, Dallas and Atlanta, while mid-sized markets also remained active. The map below shows those metro areas that experienced the most activity.
Economic incentives continue to be meaningful to the distribution industry
The following table highlights notable economic incentive packages for distribution center projects. For these notable projects, economic incentive packages averaged 19% of the estimated project capital investment and were also clustered around large distribution-intensive markets.
Notable Distribution Center Economic Incentives Deals
| Company | Metro Area | Incentive ($M USD) | Investment ($M USD) | New or Retained Jobs |
|---|---|---|---|---|
| United Parcel Service | Memphis, TN | $38.03 | $216.60 | 25 |
| The DeLong Co. | Milwaukee, WI | $20.80 | $31.30 | 0 |
| Amazon | Atlanta, GA | $19.25 | $238.00 | 1,000 |
| Nestle | Clinton, IA | $9.60 | $140.00 | 73 |
| The Kroger Co. | Washington, DC | $7.15 | $0.00 | 400 |
| Amazon | Philadelphia, PA | $4.50 | $250.00 | 1,000 |
| FedEx Corp. | Indianapolis, IN | $4.40 | $1,603.00 | 288 |
| Returns R US | Chicago, IL | $1.97 | $0.00 | 44 |
| Wastequip | Mount Sterling, KY | $1.90 | $7.28 | 100 |
| Clark Associates | Madisonville, KY | $1.50 | $8.50 | 200 |
| Groff Tractor Holdings | Harrisburg, PA | $1.09 | $2.18 | 12 |
| Chick-fil-A | Atlanta, GA | $0.65 | $4.00 | 300 |
| NFI Industries | Indianapolis, IN | $0.50 | $49.63 | 90 |
| KeHE Distributors | Bloomington, IN | $0.40 | $11.47 | 60 |
| Scariano Wholesale Foods | Hammond, LA | $0.25 | $10.00 | 101 |
| Affordable Solar Installation | Albuquerque, NM | $0.25 | $0.00 | 21 |
| Porter Pipe and Supply Co. | Indianapolis, IN | $0.21 | $1.13 | 30 |
| S Rays | Louisville, KY | $0.20 | $0.46 | 38 |
| H3C Enterprises | Harrisburg, PA | $0.17 | $0.49 | 0 |
| ScreenBroidery | Indianapolis, IN | $0.17 | $1.69 | 24 |
Source: Incentives Monitor
