DC Velocity - December 2013

WHEN ONE THINKS OF AN IDEAL WEST COAST VENUE FOR A “logistics cluster,” Quincy, Wash., doesn’t spring to mind.

Rather, the default location is the area of Southern California stretching from the ports of Los Angeles and Long Beach eastward to the ware-house-rich “Inland Empire.” The corridor offers superior infrastructure, a critical mass of third-party logistics service providers (3PLs), and a large pool of potential employees, the ingredients for an ideal “ logistics cluster,” a term popularized by Massachusetts Institute of Technology professor Yossi Sheffi in his book Logistics Clusters: Delivering Value and Driving Growth.

“If you are importing and 50 percent or more of your product is coming into the Port of Long Beach or Los Angeles, you need to be close to the port, even though real estate costs will be high and so will labor costs,” says Tom Patterson, senior vice president, West Coast operations, for Saddle Creek Logistics Services, a Lakeland, Fla.-based 3PL.

But many of Saddle Creek’s clients have found that because of its huge geography, the West cannot be efficiently served from Southern California alone, says Patterson. In addition, high property prices and traffic congestion have sent businesses searching for more cost-effective locations. Three of those are Dallas/Fort Worth, Texas; Reno, Nev.; and, yes, the central Washington hamlet of Quincy: population, as of 2010, 6,750.

DALLAS/FORT WORTH

The Dallas/Fort Worth area has been “on a little bit of a rush” lately when it comes to the building of distribution centers, according to Mike Rosa, senior vice president of economic development for the Dallas Regional Chamber.

Rosa rattles off just a few of the deals that have been inked in the past 18 months: a 951,000-square-foot e-fulfillment center for retailer Kohl’s, a 300,000-square-foot parts distribution center for BMW, and a 513,000-square-foot regional warehouse for L’Oreal Group.

Much of the increased industrial activity is driven by the law of large numbers. The Dallas-Fort Worth Metroplex is the fourth most populous metro area in the country with 7 million people.

While they may not displace Southern California as the key logistics hub for the western United States, these three regions are on the rise: Dallas/Fort Worth; Reno, Nev.;