Part 1: Richmond stands to be big winner with DC space at a premium.
Part 2: Size and Location
Richmond stands to be big winner with DC space at a premium.
It should not come as a huge surprise that big companies like Dollar Tree and Lumber Liquidators center their East Coast distribution operations in Virginia. Amazon also has a major fulfillment center there, in the state capital of Richmond.
As companies that are heavily dependent on imports, Dollar Tree and Lumber Liquidators enjoy proximity to the Port of Virginia, the sixth-largest container port in the U.S. Lumber Liquidators, North America’s largest specialty retailer of hardwood flooring, barges its imports to the Richmond Marine Terminal (RMT) before they are trucked to its distribution center in nearby Henrico County.
In the case of Dollar Tree, a Fortune 200 company with over 14,000 retail stores in North America, Chesapeake, Virginia, is where it all began and where it still keeps its corporate headquarters. The distribution center attached to corporate headquarters is referred to as DC1, although, at 400,000 square feet, is one-third the typical size of the company’s newer facilities.
The Hampton Roads port area, and Richmond, 100 miles up the James River, represent excellent geographical locations for distribution operations to the eastern half of the United States. But the region’s potential to become a distribution Mecca has been hampered by unusual economic conditions—high occupancy rates coupled with low rents—which discourage developers to build distribution space on spec. Richmond enjoys a better situation than Norfolk, according to the industrial real estate experts at Colliers International, with more speculative development coming on line and under development, and the situation may be changing in the port area as well.
