E-commerce Taking Up More Metro Phoenix Industrial Space

Published: Monday, July 30, 2018 - 8:48am
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E-commerce is taking up more space across the Valley. Real estate and investment management firm, JLL, says during the second quarter, e-commerce companies signed nearly 40 percent of all industrial leases in metro Phoenix, compared to 7 percent by logistics and distribution users.

While the southwest Valley is known for large retail distribution centers, other areas are welcoming new fulfillment centers — facilities focused on shipping online orders and handling returns.

“Most or many  — let’s say many — retailers are shrinking their footprints, and what they’re doing is simply moving the product from what used to be the retail shelf into a fulfillment center,” said Anthony Lydon, JLL managing director.

Some fulfillment centers focus on what’s called the "last mile." They’re stocked with high demand items and operate close to the customer base, “addressing the ‘what I want, where I want it and when I want it’ reality of today’s buyer,” explained Lydon.

The southeast Valley and Phoenix Sky Harbor Airport are popular submarkets for last mile centers. Lydon said e-commerce currently represents around 10 percent of all retail sales. Within ten years, he expects that to hit 40 percent.

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