E-coms are gobbling up the biggest U.S. warehouses
Fifty-six of the 100 largest warehouse leases in the first half of 2018 were signed by e-commerce and third-party logistics companies, according to CBRE.
A new report from the global real estate services company reported that 30 of the leases were for warehouses larger than 750,000 sq. ft., reflecting e-commerce users’ preference for expansive facilities with high ceiling heights and, in many cases, modern specifications for automation and rapid movement of massive inventories.
“The supply chain arms race is as competitive as it’s ever been,” said Adam Mullen, CBRE Americas leader of Industrial & Logistics. “While e-commerce is driving many new leases, there still is a solid diversity of users throughout the top 100 leases.”
The balance of the top 100 warehouse leases were signed by manufacturers (14), food and beverage providers (11), retailers (7), technology companies (4). The remaining eight leases fell into CBRE’s “other” category.
California’s Inland Empire led all U.S. metros in the top 100 with 14 leases. Other hot markets for big leases included Atlanta, Chicago, Pennsylvania’s I-78/I-81 corridor, and Dallas-Fort Worth.
Lululemon’s SoHo store intros a new feature
What took them so long?
Lululemon, the athletic apparel chain cherished by fit women for yoga togs, will establish a first at its new SoHo location in New York: a yoga studio.
While the Canada-based retailer is known for holding yoga classes in stores among the merchandise, the 9,230-sq.-ft. store at 520 Broadway has plenty of space for the real thing.
“This is a particularly interesting project from a construction perspective and we’re excited to use our retail expertise to ensure it is a truly memorable addition to the space,” said Matthew Schimenti, president of Schimenti Construction, which is doing the build-out.
Lululemon is on a hot streak having recently reported that revenue was up 25% to $724 million in the second quarter, thanks to online growth and increasing sales across China. The company ended the quarter with 415 stores.
Schimenti is no stranger to SoHo. Other recent projects include the Nike flagship store at 529 Broadway and COS at 129 Spring Street.
Walmart rides Jet into New York City
After decades of being denied a physical presence in New York City by unions claiming the mega-retailer takes advantage of its workers, Walmart has finally wormed its way into the Big Apple.
The New York Times reported that Walmart has leased a 205,000-sq.-ft. warehouse in the Bronx that it intends to use as a base to grow sales of its Jet.com unit in New York.
The Times suggested that Jet’s push into New York, Boston, Philadelphia, and Washington represents a strategic move on the part of Walmart to win a bigger share of the wallets of higher-income city dwellers. The paper quoted Jet president Simon Belsham as saying, “We believe we can win in New York.”
Walmart was rebuffed in previous efforts to open its big-box stores in Queens and Brooklyn. Labor groups including the Working Families Party convinced community boards and municipal officials to vote down proposed projects due to poor working conditions for employees.
City officials will continue to be vigilant of Walmart in its new gambit.
“Walmart may think they have found a new, under-the-radar path into New York City by buying up businesses already here, but we should not be fooled. We intend to be watching very carefully,” said Comptroller Scott M. Stringer in a statement.