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A build-to-suit development in the southwest portion of the Atlanta area for a major retailer highlights the increased activity the metro area is seeing in e-commerce facilities, underscores the resurgence of construction activity in the local warehouse market since the Great Recession, and signals a new trend in the location of this type of facility.
In a deal officially announced Oct. 16, Bentonville, Ark.-based Wal-Mart Stores Inc., the world’s largest retailer, is locating a new, 1.2 million-square-foot e-commerce distribution center in Union City, a south Fulton County municipality located along I-85 just outside I-285, about nine miles west of Hartsfield-Jackson Atlanta International Airport.
According to a statement from the office of Gov. Nathan Deal, the new facility will create more than 400 jobs, with Walmart slated to invest more than $108 million in the project over the next three years.
Walmart’s new distribution center, located off South Fulton Parkway in the Majestic Airport Center IV industrial park, will be developed by Majestic Realty Co. to the retailer’s specifications, and leased back to them as a result of a deal the Atlanta office of Los Angeles-based industrial development giant. The facility is slated for completion during second quarter 2015.
The Walmart deal, which won NAIOP Georgia’s Industrial Deal of the Year, comes on the heels of the completion of a more than 1 million-square-foot build-to-suit for Cincinnati-based consumer products maker Procter & Gamble, another Union City development deals that Majestic put together in late 2013, and a 560,000-square-foot building leased to Silicon Valley-based Menlo Logistics, a third-party logistics provider.
Majestic now owns and manages more than 10 million square feet of industrial space in and around Union City. The company will also has plans to start three more speculative buildings in the area in the immediate future, including a 1 million-square-foot facility behind the new Walmart, as well as buildings sized at 100,000 square feet and 150,000 square feet at nearby Majestic Airport Center III.
There were a number of challenges that had to overcome to get this project out of the ground, according to Stan Conway, Majestic senior vice president and director of development, who did the Walmart deal along with colleagues Scott Brown, vice president, and Will Lombard, director of leasing and development.
“Finding a close-in site that was large enough to accommodate the building was in itself quite an undertaking,” said Conway.
That was only the first of site-related challenges. For example, Majestic had to bring a sewer line more than 7,000 feet to serve the site, as well as move a major gas line some 2,000 feet, he said
The end result is a cutting-edge e-commerce distribution center with the latest in high-tech material handling equipment. Features include a fully secured truck court;20,000 square feet of office space; and the capability to expand by 384,500 square feet.
E-commerce facilities are a major contributor to industrial activity, said Doug Smith, president of NAIOP Georgia and senior vice president of leasing for Seefried Industrial Properties Inc. “E-commerce’s impact on industrial real estate is profound. During the past 36 months or so, it has been driving the development and leasing of industrial buildings in markets across the country.”
The jobs created by the Walmart and other Majestic deals have been positive for Union City.
“Majestic is not only proactive in the development of Union City — such as Walmart, Procter & Gamble and Menlo — but it’s also helped position us as a positive place for others to come do business,” said Union City Mayor Vince Williams.
CLOSER LOOK
- Project name: Wal-Mart Stores Inc. build-to-suit and lease
- Location: Majestic Airport Center IV, Union City, Georgia
- Description: 1.2 million-square-foot e-commerce distribution center.
- Developer: Majestic Realty Co.
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