Los Angeles may be best known as home to Hollywood stars and Disney characters, but to those in the logistics industry, the second largest urban centre in the US is better known as one of the largest gateway cities in the world.
Greater Los Angeles is where the Port of Los Angeles / Long Beach is located. “America’s Port”, as it’s affectionately known, has long been a hub of trading activity between the US and Asia, but today, about 50 per cent of all goods arriving at this local port stay within the region.
All this activity translates to a high demand for industrial properties. Southern California’s 178 million sqm of industrial space is now the largest of its kind in the US, a fact that is even more compelling when coupled with the Greater Los Angeles industrial market vacancy rate of just 5.5%, the lowest in the country. Combine this with the high TEU volumes at the Port of Los Angeles / Long Beach (more than 15 million per annum), and a growing population of 18 million people, it’s no wonder this is a city offering ample opportunities for Goodman.
This is also a region our customers are drawn to. In 2016, we welcomed Amazon, the eighth-largest retailer in the world, to the first of two of Goodman’s one million square feet logistics centres in Southern California’s Eastvale.
The new facility Amazon has moved into incorporates the latest in automation technologies. Furthermore, in this state-of-the-art, LEED-certified facility, they are able to capitalise on one of the best locations for logistics in the Greater Los Angeles region.
Amazon isn’t the only Goodman customer focusing on last mile delivery. As online purchasing volumes skyrocket, our customers want, and need, to be closer to their consumers. By continuing to develop momentum in the US market, we’re helping them achieve that. We have completed and stabilised over 300,000 sqm of new space, and we currently have a further 240,000 sqm under construction.
Amazon is just one big customer name to be drawn to the popularity of the Inland Empire market. Goodman has welcomed customers including Walmart, Georgia-Pacific and Volkswagen to its portfolio across the region.
Capitalising on this type of growth market is not always straightforward. A lack of available land for new development in the region requires an increasingly creative approach from Goodman. An example of how we’re doing this is our aquisition of a 55 acre former oil-refining site in Santa Fe Springs, California, a highly strategic location for our customers, due to its close proximity to consumers and the Ports. The site required extensive remediation, however the final product will deliver Class A distribution buildings ranging from approximately 28,000 sqm to 47,000 sqm.