“If you build it, they will come.”
They prophesy has come true as a multi-story warehouse building built in Seattle by commercial real-estate giant Prologis (NYSE: PLD) has its first tenants: Amazon and Home Depot.
Amazon (NASDAQ: AMZN) will take almost 500,000 square feet of space and Home Depot (NYSE: HD) nearly 100,000, according to the Wall Street Journal. The three-story building is reportedly 590,000 square feet and located minutes from downtown Seattle and the port.
FreightWaves previously reported that the first floor occupies more than 239,000 square feet, has a 28-foot clear height, 130 truck courts, and 60 truck aprons. The second floor, with more than 170,000 square feet, has a 24-foot clear height and an elevated 130-foot court served by two ramps that can accommodate big rigs. Level 3, at more than 180,000 square feet, has a 16-foot clear height and two loading docks supported by three forklift-accessible freight elevators.
Vertical warehouses are not common in the U.S. – the Seattle facility may be the first in America – but are growing more popular in Asia and Europe. Typically, a vertical warehouse allows for more storage of goods closer to their end destination.
A Home Depot spokesperson told the Wall Street Journal that was precisely what drove it to Prologis’ Seattle facility. The goal is to reach 90% of its shoppers with same-day or next-day delivery service and the only way to achieve that is to locate warehouses closer to city centers. With land at a premium for large, sprawling warehouses, going vertical is a logical solution.
E-commerce is playing a large role in the push to locate warehouses closer to end customers, as well as low vacancy rates for existing facilities.
At least two other multi-story warehouse facilities are planned for New York City.
Prologis Ventures, the venture capital arm of Prologis, is an investor in FreightWaves.