DC Velocity - May 2013

BY SUSAN K. LACEFIELD, ASSOCIATE EDITOR

REGIONAL HUBS AND SITE SELECTION SERIES

Emerging logistics hot spots:

The Southeast

Logistics activity in the southeastern United States is heating up—and not just in the traditional hot spot of Atlanta. Here are three more rising stars.

WHEN IT COMES TO REGIONS IN THE UNITED STATES THAT OFFER GROWing logistics opportunities, the Southeast sits at the top of the list, says Richard Thompson, managing director at industrial real estate firm Jones Lang Lasalle Inc.

The reason for the region’s appeal is no mystery, says Thompson. “First, it’s an ideal spot in terms of freight costs,” he says. The Southeast has an attractive population density, with 45 percent of the U.S. population living in the region. It also has a strong supply chain infrastructure with robust rail and highway connectivity and access to quality seaports like Miami; Savannah, Ga.; Charleston, S.C.; and Jacksonville, Fla., Thompson says.

Second, labor costs are relatively low because the Southeast is generally a nonunion region. And unlike other logistics hot spots, real estate in the Southeast is relatively abundant, according to Thompson.

“If you’re looking for a 1,000-acre industrial site, you’re not going to find that in
[California’s] Inland Empire, and you’re not going to find that in Chicago or New
York,” says Thompson. “But you are going to find that in Tennessee, Alabama,
Georgia, and other southeastern states.”
In addition, state governments have worked to attract business by offering generous
incentives to either start a company or relocate an existing enterprise.

The Atlanta metropolitan area has long been the region’s main hub of logistics activity, and despite economic setbacks in the past decade due to downturns in the IT, telecom, and housing sectors, Atlanta’s best days are still ahead of it, according to Thompson.

But there are other locations working hard to get on logistics professionals’ radar screens. In this article, we highlight three: Central Florida, the Piedmont Triad region of North Carolina, and Savannah.

CENTRAL FLORIDA

Not much gets made in Florida. The state is heavily tilted toward consumption because of its large retiree population. As a result, most of the goods moving through the state flow south, not north.

But that pronounced imbalance might reverse itself come 2015, when the widened and deepened Panama Canal opens. Two Florida ports, the Port of Miami and Port Manatee near Tampa, are the closest U.S. ports to the canal. Miami, in particular, is making a big push for cargo, vying for what it expects to be a larger share of waterborne commerce heading through the expanded canal to the East Coast.