Traffic World

Dallas Logistics Hub Takes Shape

Dallas Logistics Hub developer The Allen Group selected two Dallas-area contractors to build the first two speculative warehouse-distribution facilities at the 6,000-acre park.

3i Construction will build the 192,850 square foot DLH Building 2 and will provide construction services on DLH Building 1, a 635,000 square foot cross-docking facility to be built by Mycon General Contractors of McKinney, Texas.

Construction of Buildings 1 and 2 will start in late July and should be complete by February 2008. The Dallas Logistics Hub will eventually incorporate 60 million square feet of distribution, manufacturing, office and retail development. It is located adjacent to Union Pacific’s Southern Dallas Intermodal Terminal, a proposed intermodal project by BNSF, four major highway connections and Lancaster Airport in south Dallas County. It is planned to be a component of the NAFTA infrastructure and as an inland port serving U.S. West Coast and developing Mexican seaports.

Gulf Shipper

Kansas City Becoming Important Rail Hub

During the railroad boom of the 19th century, cattlemen and farmers on the Great Plains looked to Kansas City as their gateway to the eastern United States.

Today, Kansas City is a hot spot of railroad activity again; this time; however, international freight is driving the growth.

Kansas City Southern Railway, a north-south carrier in the Mexico-U.S.-Canada corridor, and BNSF Railway, an east-west carrier of Asian imports moving through West Coast ports, have chosen Kansas City as a location for rail logistics parks.

The development of intermodal rail logistics parks in recent years turned Chicago and Dallas-Fort Worth into vibrant inland ports for international freight. Retailers and large importers built distribution centers near Chicago and Dallas to process containerized imports for distribution in the Midwest and Southwest.

Railroads are turning their attention to secondary hubs, and Kansas City is the current object of their attention.

KCS and CenterPoint Properties, an industrial real estate company, in July announced a partnership to develop a former Air Force base in south Kansas City into a 1,300-acre rail logistics hub. Late last year, BNSF and industrial real estate developer Allen Group announced plans to build a 1,000-acre logistics park in Gardner, Kan., a short distance from Kansas City.

Several national retailers already have regional domestic distribution centers in the area, said Chris Gutierrez, president of Kansas City SmartPort Inc. The KCS and BNSF projects are significant because they will link Kansas City via rail to international gateways such as Los Angeles-Long Beach and Lazaro Cardenas, Mexico, giving Kansas City a tool for attracting import distribution facilities.

U.S. Customs and Border Protection has an operation in Kansas City, so cargo can move there in-bond from seaports and be cleared at the inland port. Designation of the area as a foreign trade zone further enhances Kansas City’s potential for attracting international cargo.

Building on the success of its Chicago-area developments, CenterPoint was ready to take the rail logistics hub concept to other emerging markets, said Fred Reynolds, senior vice president of development. Kansas City offers the multimodal transportation options that importers seek in a logistics park intermodal rail links to international gateways and a large consumer and production base within a day’s truck haul, he said.

Shortening the truck haul from an import distribution center to regional distribution centers and stores is an important consideration in the business plan of retailers and importers, Reynolds said. Rising fuel costs have hurt the economics of long-haul trucking. The trucking industry also is struggling with a driver shortage.

Completing a trip in one day addresses drivers’ hours-of-service limitations as well as their desire to return home at night.

Kansas City is an important hub for BNSF and KCS.

 “It’s at the northern end of our system,” said Warren K. Erdman, senior vice president of corporate affairs at KCS. Domestically, KCS’s network stretches from the Gulf of Mexico to Kansas City. KCS also offers direct service from Lazaro Cardenas, on Mexico’s west coast, to the Texas border.

KCS is already the major North American Free Trade Agreement rail carrier for cargo moving between Mexico and the U.S., and it carries some interline cargo from Canada. KCS is banking on its operation in Lazaro Cardenas to make it a major player in the Asian import trade.

With U.S. West Coast ports facing future capacity constraints, shipping lines and marine terminal operators are looking to ports in Mexico and Canada as trans-Pacific gateways. Prince Rupert, British Columbia, will open this fall and will become a gateway to the U.S. Midwest.

Kansas City is an important hub for BNSF’s services from West Coast ports. Its Transcon line from Los Angeles-Long Beach to Chicago is BNSF’s busiest intermodal corridor. Kansas City was therefore a logical choice for the railroad’s third logistics hub.

BNSF pioneered the intermodal rail logistics park concept in Dallas and then followed with its Chicago-area hub. Kansas City is within a 300-mile drive of major population and production centers in the middle of the U.S., providing access to the country’s midsection that might be out of reach from Chicago and Dallas, said Vann Cunningham, assistant vice president of economic development at BNSF. Cunningham sees Kansas City as the first of a number of secondary inland hubs that railroads will develop as the rail logistics markets in Chicago and Dallas are built out. Victorville, Calif., Memphis and locations in Ohio and Indiana are also logical choices for rail logistics hubs, he said

Inbound Logistics

A Dallas-Mexico Connection

With the aim of improving the flow of goods between Mexico and the United States, a Mexican inland port developer and U.S. real estate development firm have partnered to promote a new trade corridor.

The agreement links Interpuerto, a Monterrey-Saltillo, Mexico-based logistics hub, and the Dallas Logistics Hub, a 6,000-acre logistics park currently being developed by San Diego-based The Allen Group.

The connection of the two hubs is part of a larger movement to improve cross-border trade by expanding infrastructure to boost supply chain efficiency. The partners expect the new corridor to improve efficiency, speed, and security, as well as the ability for the two hubs to compete on an international level.

Previously, ineffective transportation between the two countries prevented the hubs from serving companies importing products from around the world.

By adding a customs pre-clearance zone, imports can be cleared before leaving the port of origin, which should expedite shipment flow and provide additional security for companies operating within the two hubs, says Ambassador Francisco Javier-Aleko, executive coordinator for INVITE, the developer behind Interpuerto.

Dan McAuliffe, president of The Allen Group, believes the partnership will provide faster delivery times, which may result in a new competitive advantage for companies in both Mexico and the United States.

Texas Real Estate Business

Dallas Logistics Hub Creates Massive Impact South of the
Metroplex

With a projected build-out of 20 years across 6,000 acres, The Allen Group and its development associates expect the Dallas Logistics Hub to have a huge impact on the local industrial market. Masterplanned for both speculative industrial and office space as well as build-to-suit opportunities, the development will add a projected total of 60 million square feet of commercial space to the market. DLH Buildings 1 & 2 — a 633,000-square-foot crossdock facility and a 192,000-square-foot warehouse/distribution property, respectively — are both being constructed speculatively and are expected to be complete by February 2008.

“Maximizing building coverage and clear-height while minimizing development costs, balancing building size and trailer parking demands to meet the needs of today’s users, and providing a highperformance and sustainable core-and-shell building without negatively impacting the bottom line lease rate were all important aspects in designing the new buildings,” says Daniel McAuliffe, president of Allen Development of Texas.

Eventually, the project will spread across four municipalities, including Dallas, Lancaster, Wilmer and Hutchins, Texas. Situated adjacent to Union Pacific’s Southern Dallas Intermodal Terminal, a proposed BNSF intermodal facility and four major highways — Interstates, 20, 35 and 45 as well as Loop 9/Trans Texas Corridor — the project is perfectly situated as a distribution hub for in and out of Dallas. Aside from developer The Allen Group, other companies involved with the project include GSO Architects, responsible for the design; Kimley-Horn & Associates, civil engineer; Guaranty Bank providing financial services; and MYCON and 3i Construction as general contractors.

When build-out is complete, the total economic impact of Dallas Logistics Hub on the entire Dallas Metroplex is estimated at $68.5 billion, and the project is expected to create 31,000 direct jobs as well as 32,000 indirect jobs, clearly having a phenomenal influence on the local economy.

“Dallas Logistics Hub is one of the most sophisticated logistics parks in the country, because of its unique infrastructure surrounding 6,000 acres,” says McAuliffe. “With the increase of international trade and frequent west-to-east freight movement, all the transportation options here will set this project apart; there are very few land sites, if any, available in the country that can offer companies key ingredients for the fast, efficient and on-time delivery of their products.”

Business News Americas

Automotive, High-tech, Aerospace to Benefit From Logistics Corridor – Mexico

The automotive, high-tech and aerospace industries, among others, will see the benefits of a project to build a corridor between northeastern Mexican state Nuevo León’s Interpuerto Monterrey inland port and the Dallas Logistics Hub in Texas, a Nuevo León government official told BNamericas.

 “Considering that Laredo [Texas] has an [average overall] movement of 8,000 operations per day, plus the Colombia-Nuevo León Bridge has another 3,000, this [provides] a great number” of trade opportunities along the corridor, said the official from INVITE, the state government entity developing the inland port.

The corridor will begin with the construction of a highway, followed by the construction of a railway line, and will run from the Interpuerto Monterrey, eventually connecting to the Dallas Logistics Hub through the existing I-35 highway, the official added.

“The idea we have been working on with our partners is to do a pre-clearance of goods at Interpuerto Monterrey, providing secure and fast trade through the Nafta corridor,” said the INVITE official.

A company will be selected to carry out the highway works through a public-private partnership “in the near future,” the state official added, although a specific date could not be given.

INVITE has signed a memorandum of understanding with Dallas Logistics Hub developer, The Allen Group, to develop the international corridor, The Allen Group previously announced in a press release.

The highway will be operated as a tollroad, with the railway functioning as a sprinter line, with trains running at approximately 40-60 miles (64-96km) per hour, The Allen Group’s director of government affairs and community relations, Leslie Jutzi, previously told BNamericas.

According to Nuevo León’s website, INVITE is a governmental strategic project to promote the state’s regional integration with neighboring northeastern states Chihuahua, Coahuila and Tamaulipas, together with its northern neighbor Texas. It looks to promote Monterrey as a logistics gateway.

For its part, The Allen Group is a privately held commercial development firm that specializes in the development of high-end industrial, office, retail and mixed-use properties throughout the US, with a major focus on developing logistics parks located adjacent to rail, intermodal and highway infrastructure.