The rise of e-commerce, the emergence of new technologies, and the rapid shift of populations to urban areas has changed the way we receive goods, which in turn is reshaping our cities.
Logistics is the movement of freight from its origin to its final destination, from collection to transportation to distribution. Urban logistics plays a pivotal role in ensuring the livability of urban areas, due to its fulfillment of citizens needs and its induced economic impact.
Cities have historically had an important role in the distribution of goods as primarily logistical and production centers. Urban warehousing was an vital component of the industrial revolution, storing goods before distribution to other cities around the country. During the last half of the 20th century, distribution centers followed population and production out to the suburbs.
The last-mile of transportation typically facilitated through retail centers.
Establishment of intercity distribution centers and "last touch" facilitates the next-day and same-day customers expect. Demand for infill logistics real estate has increased to provide better service and lower total supply chain costs.
There are many types of infill that can make up the "last-mile".
Urban logistical centers represent a shift of expenses from delivery-related to real estate. Centrally located distribution centers reduce the cost of rapid, high volume delivery within the urban core and dense surrounding neighborhoods.
(Source: Prologis)
An examination of the New York City market found that delivery costs account for 82%-92% of the total costs to complete same-day delivery for traditional distribution centers. It is at least 22 percent more cost-effective to service e-commerce demand in NYC last-mile facilities out of the Bronx versus other New Jersey locations.
(Source: Deloitte)
Rents for smaller urban warehouses between 70,000 and 120,000 square feet have risen by a third over the past half-decade, while availability has dropped between 7 and 11 percent.
Modern day logistics is creating new urban forms to accommodate the increase in traffic and industrial space closer to population centers. Warehouses and fulfillment centers within the city center adapted to their locations, including building up to increase density and integrating mixed-use into their structure.
Bronx, New York City
Turnbridge Equities
1.24 Million Sq Ft
Largest multi-story distribution center in the city with freight capabilities on each floor.
Chicago Loop
JLL
380,000 Sq Ft
Underground distribution center built into a downtown parking garage.
Paris, 19th arrondissement
Solargis
484,000 Sq Ft
Mixed-use facility constructed above active rail-lines. Includes an urban farm, sports facilities, offices, and a data center.
The availability of and the efficiency of