14 th TPM Annual Conference March 2-5, 2014

Transcription

1 March 4, th TPM Annual Conference March 2-5, 2014 The East Coast/West Coast Picture Clarifies Michael P. Murphy, Chief Development Officer

2 Intermodal Advantages Distribution centers immediately adjacent to infrastructure assets (intermodal yards/ports) significantly reduce the total landed cost of their product. 60.0% 50.0% 50.3% Logistics Cost Breakdown 40.0% 30.0% 20.0% 10.0% 0.0% 21.8% 9.5% 7.8% Transportation Inventory Labor Customer Service 4.3% 2.7% 2.2% 1.2% Rent Admin. Supplies Other Source: Establish,Inc/ Herbert W. Davis and Company 2006 Database 2

3 CenterPoint Intermodal Center - Joliet/Elwood 3

4 CHALLENGE Home Depot Case Study Explosive growth in HD s retail footprint lead to a lack of attention to its distribution network resulting in numerous issues: Stock-outs occurred in retail outlets Rising transportation costs from direct LTL shipments from vendors to stores Employees in the store spent too much time receiving inventory instead of on the sales floor Home Depot s 2008 Facilities within the I-55 Corridor HD s Old Locations vs. New Campus Location Lack of supply-chain focus led to four distribution centers in the Interstate-55 submarket, 25 miles away from the source of inbound inventory resulting in: High drayage and fuel surcharge transportation costs Redundant management for four different facilities Higher inventory levels due to decentralized locations City Size 1 Romeoville 400,000 SF 2 Bolingbrook 747,152 SF 3 Romeoville 720,000 SF 4 Romeoville 444,096 SF Leased SF- I-55 Market (2008) 2,331,248 SF Home Depot s New Campus Timeline 2006 Home Depot has four separate distribution centers within 25 miles of the BNSF 2010 Home Depot begins consolidation and announces RDC at CIC- Joliet 2012 Home Depot announces 1,618,048 SF SDC at CIC- Joliet 4

5 Solutions Home Depot Case Study Home Depot consolidated four buildings dispersed throughout the Interstate-55 submarket, into a two building campus within the CenterPoint Intermodal Center. Given its close proximity to two international intermodal centers and regional interstate highway connectivity, the new distribution campus allows Home Depot to: Reduce inbound transportation costs Reduce overall inventory levels Postpone shipment times to improve store replenishment Increase likelihood of full, outbound truck load shipments to stores Reduce warehouse overhead by operating in a two building campus setting Campus Aerial CenterPoint Intermodal Center - Joliet CenterPoint Intermodal Center By locating to CIC Joliet vs. the I-55 Corridor, Home Depot will realize an ongoing estimated annual transportation savings of $7.5 Million Campus Summary SDC: 1,618,048 SF, 87.9 acres RDC: 657,600 SF, acres 423 total exterior docks 1,194 total trailer stalls 5

6 Neovia Logistics Services Import/Export Distribution Facility Neovia Logistics Services CenterPoint Intermodal Center- Joliet, Illinois Neovia Logistics Services estimates it will import/export 30,000 containers out of this location annually Import from Europe, Brazil, Japan and China Export parts to manufacturers throughout world 300 deep building; Inventory turns once every week Co-located from separate facilities; 10-year lease 6

7 South Carolina Inland Port (SCIP) Greer, SC Park Aerial 7

8 SCIP Concept Plan South Carolina Inland Port (SCIP) Greer, SC Project Summary Norfolk Southern Connection 70 Acre, $35 million Inland Port Intermodal Terminal Capable of handling 100,000 TEU s annually Direct access to Port of Charleston 230 miles from The Port of Charleston SCIP is served by the Norfolk Southern Greenville/Spartanburg - located between two of the nations largest urban regions 100 miles from Charlotte, 130 miles from Atlanta Connected by the commerce-rich Boom Belt I-85 $3.8 billion of new capital invested in SC over the last 2.5 years 8

9 SCIP s Economic, Environmental and Traffic Impacts Approximately 70,000 containers each year, previously transported via truck, will now be transported to Greenville/Spartanburg via rail. Environmental Impacts of the SCIP One gallon of diesel fuel moves one ton of freight: More than 435 miles via rail Less than 100 miles via truck Trucks emit 4x more Greenhouse gases than freight rail Intermodal rail hubs lessen national carbon footprint Freight transported by rail is 4x more energy efficient Modern, efficient exurban intermodal hubs reduce inner city congestion and train idling Strategically located intermodal facilities reduce truck drayage to distribution warehouses Integrated sustainable logistics campus 9

10 BMW Greenville/Spartanburg, SC BMW Rendering Proximate to pre-existing BMW 4.5 million square foot manufacturing facility Offers BMW a short, quick dray of completed units to the warehouse, so they can be broken down and prepared for shipping/export. Immediacy to the SCIP and direct rail access, via the NS, the Port of Charleston Better control of inventory, lowering demurrage, and realizing the considerable drayage savings by locating adjacent to an intermodal Campus Summary 414,460 SF on acres Expandable to 711,160 SF Office space: 10,073 SF Project cost: $22 million Start date: End date:

11 CenterPoint Intermodal Center Suffolk, VA 900-acre integrated intermodal center $350 million CenterPoint investment CSX rail connectivity Dual access to I-95 via Route 58 and the proposed new I-460 Current tenants include Ace Hardware and Nexcom 11

12 CIC- Savannah Savannah, GA Park Rendering 12

13 The Judge Organization (CIC Savannah) Judge CenterPoint Intermodal Center- Savannah, GA This Norfolk Southern served facility is located only four miles from the Port of Savannah 266,700 square feet/14.39 acres 2 Rail Spurs under canopy High velocity facility from rail to dock 12 Overhead Rail Doors Best in Market facility attracts additional rail business for The Judge Organization 13