Sound Bites from NAIOP’s E.CON: The E-commerce Conference

Summer 2014

Sound Bites from NAIOP's E.CON: The E-commerce Conference in Phoenix

“Retailers are right-sizing. … The ‘sweet spot’ is in the 25,000- to 30,000-square-foot range.” Rene Circ, director of industrial research, PPR/CoStar

“Kohl’s is a classic example of what’s happening: they were building 60 department stores a year; now their entire capital expenditure budget has been shifted toward building their omnichannel network. That’s all been driven by Wall Street.” Garrick Brown, director of research, Cassidy Turley

“Twenty to 25 percent of all demand [for logistics space] is coming from e-commerce.” Chris Caton, vice president, research, Prologis

“The growth in international e-commerce is absolutely phenomenal.” David Parks, managing director, FedEx Trade Networks

“We need to be near the ultimate buyer of the product. … What we really care about is how close we are to ground hubs, as opposed to air hubs, because air is just too expensive to ship e-commerce orders in any kind of quantity.” Bruce Welty, CEO, Quiet Logistics

“It seems that with every new building, the next generation of cutting-edge technology is being implemented, trying to squeeze out additional efficiencies in the supply chain, thereby driving down the cost to consumers. A very large part of that equation is what goes on inside the ‘box,’ namely, what happens to the product when it arrives at the facility until the time it actually leaves the shipping docks. Material handling equipment has become a major capital investment for [e-commerce] companies.” Philip Prassas, senior vice president, KTR Capital Partners

“We’re starting to see 3PLs partnering with development groups, realty groups, and making those kinds of deals [for buildings that include expensive equipment and articulated warehouse systems] for a whole-package building: internal fixtures and the facility lease, allin one. They are not the most common approach now, but [they are] starting to gain traction.” Bryan Jensen, principal, St. Onge Company