A recent study of the commercial real estate market throughout the U.S. put the Southeast ahead of all other regions, according to the Society of Industrial and Office Realtors’ (SIOR) year-end 2007 Commercial Real Estate Index.

Atlanta, along with Research Triangle in North Carolina, showed the most economic resiliency, which may not come as much of a surprise to Bill Stankiewicz, vice president and general manager of Shippers Warehouse of Georgia (www.shipperswarehousega.com), who points out that Atlanta is also the fifth-largest employer in the U.S. market and “will only continue to grow due to the great colleges/universities, location, people, and great weather.”

The city also happens to be a prime location for transportation and logistics, he adds. “Metro Atlanta has become a leading logistics center with more than half of the top 100 3PLs having operations here. It’s also home to the Logistics Institute at Georgia Tech, which provides worldwide expertise for supply chain solutions. While Atlanta has a diverse industrial base and strong service economy, it is first and foremost a transportation center,” he emphasizes. “In preparation for the 1996 Atlanta Olympic Games, Atlanta was designated as the first U.S. Customs Inland Port—a general purpose Foreign Trade Zone that allows containers to travel inbound duty-free from coastal ports. That distinction helped Atlanta’s cargo business boom—the region’s cargo output now ranks tenth in the U.S. With three major interstate highways intersecting in Atlanta and an extraordinary concentration of rail systems, trucking companies, and warehouses and distribution centers, Atlanta’s logistics infrastructure and capabilities are unrivaled,” says Stankiewicz.

As for ocean cargo activity, Georgia’s two deepwater ports—Savannah and Brunswick—are poised for continued growth this year. In fact, the Port of Savannah is experiencing major gains in both container traffic and real estate development. The port surpassed 2 million TEUs in fiscal 2006 and now ranks as one of the fastest-growing in the nation.

One of the newest (and greenest) developments in Savannah is the AMB Morgan Business Center, a multi-building master-planned development located near the port. According to AMB Property Corporation (www.amb.com), “This will be the first silver LEED-certified speculative development in the southeastern United States.”

Another port that’s preparing for continued strong growth is the Port of Charleston (www.scspa.com). According to Byron D. Miller, Director, Public Relations, South Carolina State Ports Authority, “Over the past year, the Port of Charleston has put into operation approximately $64 million in new and upgraded equipment, including 16 new rubber tire gantry cranes (RTGs) for stacking containers in the yard, and 4 new super post-Panamax dockside cranes. The new cranes are making a difference in vessel productivity—January 2008 was the most productive month ever at the Port of Charleston, with an average of 41.5 moves per hour per crane logged.”

At the same time, expansion is underway at the port’s Wando Welch Terminal, which will add an extra 50 acres of container storage and help boost capacity in the near time. The port is also constructing a new 280-acre container terminal on the former Charleston Navy Base that will boost capacity by 50 percent and accommodate growth through 2025.

In order to handle the growth, approximately 20 million square feet of prime Class A industrial distribution centers are due to hit the Port of Charleston market in the next few years, notes Miller. “These hubs include projects located in the Charleston area by Hillwood Investment Properties (www.hillwoodinvestmentproperties.com), Childress Klein, Johnson Development, and Rockefeller. In Orangeburg County, South Carolina, Jafza International is planning a major distribution and light manufacturing hub on 1,300 acres near the intersection of two major transportation arteries (I-26 and I-95). Another distribution hub announced recently—the World Trade City Orangeburg LLC—is 1,200 acres and will be located near the Jafza project.”

The North Carolina State Ports Authority (www.ncports.com), meanwhile, has also experienced a jump in freight from Asia, and is preparing for more. Already, major terminal expansion has been completed with the addition of four new 100-foot gauge container cranes, nine new container handlers, and a new terminal operating system that is facilitating a high-velocity operation and increased container throughput.

Furthermore, NC Ports has invested in electric container cranes at the Port of Wilmington to help reduce diesel emissions, says Karen Fox, Senior Director of Communications, NC Ports. In addition, the NC State Ports Authority’s ProjectEnergy team is assessing and identifying energy and environmental conservation measures ranging from retrofitting warehouse lighting and cargo handling equipment to solar and wind-driven energy generation at the port facilities.

“The Ports Authority has also engaged discussions with potential private-sector partners for the International Port,” says Fox. The proposed North Carolina International Port, Wilmington Harbor, would be built near Southport, North Carolina. The 600 acres of underdeveloped land in Brunswick County purchased by the Ports Authority is one of a few locations along the East and Gulf Coasts suitable for expansion of a new deepwater terminal. With the dramatic growth in international trade, it is expected that by 2030 there will be over 11 million containers per year of unsatisfied demand. The North Carolina International Port will be designed to handle the largest container ships and move approximately 1.7 million containers per year.

In Florida, the Port of Jacksonville (www.jaxport.com) and Port of Tampa (www.tampaport.com) are also riding a wave of  new business.

“Perhaps the most exciting development at the Port of Tampa is the port’s emergence as a bona fide container port with global connections,” points out Andy Fobes, Director of Public Relations. “Zim Integrated Shipping Services’ Asia-Gulf Express service calls weekly at the Port of Tampa Container Terminal. The service includes ten 3,000-TEU vessels. At the same time, the port has impressive plans to increase the size and infrastructure of the container terminal in the years ahead and is in line with the business opportunities that will come with the expansion of the Panama Canal, expected to be completed in 2014.”

Similar to other ports in the Southeast, JAXPORT is supported both by a strong and growing regional economy, and escalating container volumes.

One of the most anticipated projects in the works is MOL’s (www.molpower.com) new 130-acre TraPac Container Terminal at Dames Point, set for completion later this year. The $220 million TraPac Container Terminal marks the port’s entry into the Asian container trade and will double JAXPORT’s box business. The facility is expected to bring 6,000 direct and indirect jobs to Northeast Florida and result in almost a billion dollars in economic benefit annually. 

According to Raul Alfonso, JAPORT’s Director of Trade Development & Marketing, Container Cargo, the new box terminal will benefit truckers too. “Traditionally, we have been a very strong export port with our dominance in the South American and Caribbean trade lanes, which means there’s lot of truck capacity going inland. This offers a great opportunity for the new import volumes. We’ll have more of a balance at least in the trucking sector; they can avoid the ‘empty’ miles that are so costly at the moment.”

“In the warehousing sector, we’ve got over 87 million square feet in the Jacksonville area. In addition, there are over 6 million square feet of new warehousing projects in the pipeline. For example, Bridgestone-Firestone will soon open its new 1 million square foot facility, which will be a key distribution center for them. Michael’s Stores has also established a DC here in Jacksonville, and Samsonite is expanding to 850,000 square feet of warehousing.”

“The growing consumer base is a factor we emphasize when talking with potential developers and importers. Within the next five years, 45 percent of the Southeast’s population will reside in Florida, and of that amount, most growth will occur between the central and northern part of the state.” Wt

Sidebar: Miami International Airport Maintains Its Altitude

With few exceptions, domestic air cargo carriers and airports have felt the bumps of a slowing economy and rising fuel costs, in particular. One of those bucking the trend is Miami International Airport (www.miami-airport.com), which reported foreign cargo loads up nearly 6 percent in 2007 over the previous year.

Not surprisingly, the Latin American region rates as a major trade lane for the airport. According to Bunny Schreiber, Aviation Cargo Specialist, Marketing Division, the airport’s growth “can be attributed to continued increases from the Latin American market monopoly that the airport possesses. Latin America showed upwards of 6 percent growth for us, driven by rising South American economies.”

Asian air cargo volumes also showed exceptionally high increases, Schreiber adds, jumping an astronomical 240 percent, helped by Korean Air Cargo’s “continuous increases in frequencies by its freighters, and supported by China Airlines’ growth to a daily Taiwan service.”

Likewise, European traffic was up 3 to 4 percent last year, mostly due to the weaker U.S. dollar. “Miami is served by freighters from Amsterdam (Martinair); Frankfurt (LAN in cooperation with Lufthansa); and b a more recent introduction of twice-weekly freighter service to Milan by Alitalia. The Milan services balance well with our goals to establish multiple strategic points of service and distribution on the European continent,” says Schreiber.

In order to handle further growth in air cargo, several construction projects are underway at the airport, which currently offers 17 warehouses totaling 2.8 million square feet. “The first is a third-party development between Aeroterm and Centurion Air Cargo, with Aeroterm as the facility developer,” says Schreiber. “The project represents a sizeable real estate project that will produce a 500,000 square foot facility that will include 90 truck docks and parking ramps for eight large aircraft for Centurion and its related/partner airlines, including Cielos del Peru, MTA of Brazil, and an associated cargo handling company. It is anticipated that the $110 million investment will show some signs of commencement later in 2008, with construction in full swing in 2009 and completion in 2010. This new complex will be located in the northeastern corner of the airport,” she says.

 “Another project in advanced discussions with yet another facility developer, including one or more carriers, will involve the construction of two warehouses: a single-tenant facility, and another multi-tenant facility. Miami International Airport will gain approximately 200-300 square feet to its warehouse inventory contingent upon this project’s ultimate footprint, which involves the demolition of older buildings. The investment is anticipated at over $100 million and will be located in the airport’s westside cargo area.”

“Furthermore, a third facility is in discussion with a courier airline that will yield a smaller single-tenant facility for this growing carrier. Investment is estimated at $6 million and the plans should be finalized before mid-2008.”