Excerpt from Bisnow’s preview of the “The Accelerating Pace of Last Mile Delivery” session at NAIOP’s CRE.Converge 2017 by Travis Gonzalez
Online delivery has become the norm for many Americans living in urban areas. An average city resident generates approximately 0.1 deliveries per day. In a major city like Chicago, which has a population of 2.7 million, that is a minimum of 270,000 deliveries a day.
Online retailers have turned to urban infill to get closer to their customer base and are looking to former retail, office and even parking structures as potential launching points for distributing goods.
JLL Managing Director Keith Stauber
JLL Managing Director Keith Stauber has witnessed the growing number of retailer, third-party logistics companies and developers experimenting with adaptive reuse. JLL is working with Millennium Parking Garages LLC, the owner of Downtown Chicago’s Millennium Parking Garage, to repurpose some of the space into an urban fulfillment center, as well as other alternative uses like self-storage. Stretching across 3.8M SF over two floors, Millennium Parking Garage is one of the largest underground parking systems in the world.
As car ownership dwindles, more parking structures have underperforming space.
“Despite its fantastic location, it is actually somewhat under capacity from a parking perspective,” Stauber said. “Because of that, we have to consider how we can maximize revenues for the garage and City of Chicago while also utilizing it to its full potential.”
Swisslog Senior Director of Business Development
Multistory warehouses built in the early 1990s have made a comeback in dense urban areas where it makes more sense to build up than out. Reclaimed space is more cost-effective for e-commerce players, who favor short-term leases while their growth rates remain unpredictable, Swisslog Senior Director of Business Development David Schwebel said.
Read the full article on Bisnow and register today for CRE.Converge 2017.