LOGISTICS & DISTRIBUTION
From Illinois Investment Guide 2023
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Where the TDL Talent Pipeline Is Full

Logistics & Distribution
Rendering of a CJ Logistics large-scale logistics center — two are to be built in greater Chicago.
Image courtesy of CJ Logistics

by Mark Arend
T

he Land of Lincoln is in the midst of its biggest makeover in the state’s history. In June 2019, Governor JB Pritzker signed Rebuild Illinois into law, a $45 billion, six-year capital plan designed to revitalize communities across the state. Nearly three quarters of that — $33.2 billion — is earmarked for transportation infrastructure that will add to Illinois’ appeal as a location for logistics operations.

“With this historic $45 billion capital plan, we’re fixing decades-long problems, creating good jobs, improving communities for the next generation — and doing it together, across party lines,” said the governor upon signing the legislation. “The Rebuild Illinois plan transforms our state’s approach to transportation infrastructure, finally treating our roads, bridges, and railways like 21st century investments and not relics of the past.”

More than 20,500 transportation, distribution and logistics (TDL) companies employ more than 331,000 people in Illinois and contribute nearly $39 billion in economic output. According to numbers from Intersect Illinois, more than 82,000 students complete programs applicable to work in TDL each year, and the state is home to the fifth largest TDL talent pipeline in the nation. In addition, according to the agency, Illinois’ community colleges graduate more than 2,700 people each year with certificates catered to TDL career opportunities. 

As for logistics infrastructure, Illinois has all seven Class I railroads, seven Interstate highways, the country’s largest inland port, in Joliet, and two of the busiest cargo airports in the U.S. — Chicago O’Hare and Chicago Rockford International. In 2023, MidAmerica St. Louis Airport’s $31 million, 41,000-sq.-ft. terminal expansion opened. The airport has an annual economic benefit of more than $3 billion.

Korean Investment in Logistics Centers

Two Chicagoland communities are among three locations that will see new, large-scale logistics centers take shape in the coming years. In June, CJ Logistics, a supply chain and technology company in South Korea, announced a strategic partnership with the Korea Ocean Business Corporation (KOBC) to construct the logistics centers through a public-private collaboration. They will prioritize handling the import and export cargo of global and South Korean companies, facilitating their overseas expansion and trade activation.

Under the partnership, known as the “North American Project,” CJ Logistics will operate the logistics centers, and KOBC will secure funding for them. Construction is scheduled to begin in the first quarter of 2024, with a phased completion targeted from the first half of 2026 to 2027.

“We are committed to supporting our North America customer base, South Korean companies and e-commerce sellers as they enter the U.S. market,” said Sin-ho Kang, CEO of CJ Logistics, at the joint venture announcement. “By utilizing our cutting-edge logistics infrastructure and operational capabilities, we aim to increase customer value, serve as a strategic partner to our customers who can benefit from global and multimodal solutions, and expand the ‘K-Wave’ into the business sector.”

The Illinois locations for the logistics centers are Elwood, 40 miles southwest of Chicago, and Des Plaines, north of O’Hare International Airport. The Elwood site is adjacent to BNSF and Union Pacific rail terminals, and efficient nationwide transportation and delivery within one to two days are enabled via road and rail networks. 

With the development of these strategic hubs, the company is “optimizing its global logistics model to meet customer needs for integrated, end-to-end supply chain solutions. It will generate synergy by connecting the newly constructed logistics centers with its existing network of 57 operational logistics centers across the U.S.”


Transportation, Distribution & Logistics By the Numbers

  • 331,709 people employed in TDL at 20,502 companies
  • $38.6 billion in economic output
  • 26% higher job concentration than the national average (7th in nation; Chicago MSA is the 2nd largest TDL workforce cluster in the nation)
  • 4th in U.S. for number of transportation and warehousing establishments
  • Chicago has the most TDL firms in the U.S., including 24 of the top 25 third party logistics providers
  • New and expanding transportation and warehousing businesses created 40,000 jobs in 2020 in Illinois, 4th most in the nation

  Source: Intersect Illinois


Another Destination for TDL Talent

Princeton, in Bureau County, is the location of a new distribution center being built for Ollie’s Bargain Outlet, America’s largest retailer of closeouts and excess inventory. Announced in October 2022, the $68 million facility will create 145 new jobs over the next three years. The 600,000-sq.-ft. center, expected to be completed in 2024, will service more than 150 Ollie’s stores across the Midwest. As part of the expansion, the company received an Economic Development for a Growing Economy (EDGE) tax credit, which stipulates a goal of investing $68 million and creating 148 jobs over the next three years.

“We are excited to make the next key step in our nationwide expansion happen by building our fourth distribution center in Princeton,” said Ollie’s Executive Vice President and COO Eric van der Valk at the project announcement. “Illinois is one of Ollie’s fastest growing states with 10 stores and counting to open in the upcoming months. Its central location to our other markets in the Midwest region and the strong workforce made Illinois the perfect spot for breaking ground to bring customers more bargains.”

Transportation, distribution and logistics is a key growth industry for Illinois and focus of Governor Pritzker’s 5-year economic plan. Ollie’s investment is a prime example of how companies that need to move products efficiently are finding facilities that meet their TDL needs in Illinois.  

Mark Arend
Editor Emeritus of Site Selection magazine

Mark Arend

Mark Arend is editor emeritus of Site Selection, and previously served as editor in chief from 2001 to 2023. Prior to joining the editorial staff in 1997, he worked for 10 years in New York City at Wall Street Computer Review, ABA Banking Journal and Global Investment Technology. Mark graduated from the University of Hartford (Conn.) in 1985 and lives near Atlanta, Georgia.

 

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