< Previous102 SEPTEMBER 2024 S I T E S EL E C T I O N BESHEAR: OHIO RIVER BRIDGE “TRANSFORMATIONAL” It goes without saying that supply chains don’t develop and evolve without infrastructure, an emerging piece of which is the “NAFTA Superhighway” running North-South from Michigan to Texas, to terminate at the Canadian and Mexican borders. A key cog in this long-pursued vision is I-69 ORX, a bridge across the Ohio River near the highway’s midpoint. Still in the planning stages with construction set for 2027, the $1.2 billion project to link Evansville, Indiana, to Henderson, Kentucky, is being spearheaded by Indiana Gov. Eric Holcomb and Kentucky Gov. Andy Beshear, with hoped-for support from the federal government. Gov. Beshear spoke with Site Selection about the project’s potential impact. GOV. BESHEAR: The I-69 project is going to be transformational for portions of Western Kentucky. Right now, we are seeing an economy on fire in the overall Commonwealth, and lots of jobs coming to Western Kentucky in particular. The I-69 project is going to lead to even more economic development in an area that sometimes has felt left out. Site Selection: This project seems personal to you. BESHEAR: This project is very important to me. My family’s from Western Kentucky, not far from where I-69 will come through, in fact. So, I’ve seen and know what this is gonna do to many of our towns and cities along it. Kentucky Gov. Andy Beshear Photo from Flickr/Andy Beshear104 SEPTEMBER 2024 S I T E S EL E C T I O N More broadly, this is our Eisenhower moment in this country. For far too long, our infrastructure has either crumbled or we haven’t made investments in new infrastructure. The people of Western Kentucky deserve to have an Interstate that comes through and deserve to have the same opportunities as each and every one of our other communities. For a state that’s building the two largest battery plants on planet Earth and bringing in so much of the supply chain — a lot of it coming to Western Kentucky — this is going to help us grasp this opportunity and our potential. Completion is quite a way off, but you’re moving dirt around. What economic benefits has the project produced to date? And of greater importance, specifically how do you see this project supporting economic growth for that region going forward? BESHEAR: We already see significant investment. The new Pratt paper plant [$700 million] in Henderson has about 350 jobs that pay almost $40 an hour, and that changes the lives of so many people. And there’s many more of those opportunities to come, whether we are serving as a supplier to different companies that will be up or down I-69 or whether we can land another one of these large plants that can be supplied by existing groups that are already there. It makes Western Kentucky more interconnected with our national economy. This is the last major infrastructure piece outside of broadband that really moves Western Kentucky, I think, to the front of the line of places to locate a business. Do you see this project as having the potential to help generate another big EV- related project as you’ve seen with Ford and Toyota? BESHEAR: The I-69 project would create the opportunity to recruit one of those types of companies. What you need is a significant amount of land, maybe rail, utilities and a good electrical supplier. And you can’t really do it without that Interstate or without access to a significant road. So yes, it opens up more such possibilities.106 SEPTEMBER 2024 S I T E S EL E C T I O N where the railroad splits to allow it to serve both Northern California and the Southern California Basin. “The vision for this particular location is to help relieve some of the congestion that has taken place at the Ports of LA and Long Beach that really started when COVID hit,” says Lena Kent, the railway’s general director for public affairs. The Barstow International Gateway (BIG) is to consist of a rail yard, intermodal facility and warehouses for transloading freight from international containers to domestic containers at a strategic location for California and the U.S. “It’s going to enable our customers to move more of their containers and trailers right onto trains, rather than going by truck to transfer facilities,” says John Lovenburg, BNSF vice president for environment & sustainability. “The net result,” he says, “is less emissions, less congestion and a benefit for our customers and for the communities where we operate.” Electric trucks are to shuttle among warehouses built with rooftop solar, supporting BNSF’s commitment to reduce its carbon footprint by 30% by 2030. BNSF expects the project to create 20,000 direct and indirect jobs while exerting a major impact on the efficiency of the U.S. supply chain. “It’s an exciting evolution of what Barstow’s role has always been to BNSF Railway, and that’s connecting one side of the nation’s supply chain to the rest of the country,” says John Gabriel, BNSF’s vice president for network strategy & capacity planning. Cold Storage Presents Opportunities The pandemic produced changes in eating habits that continue to ripple through the supply chain, boosting Cold Storage goes spec. Photo: Getty Images (continued from p. 100)108 SEPTEMBER 2024 S I T E S EL E C T I O N the demand for cold storage facilities. Concerns about food shortages teamed with minimized trips to grocery stores to trigger widespread stockpiling. Consumers became accustomed to eating at home. With the surge of inflation, frozen foods provided a cost-effective option to perishables. In all, frozen food sales surged by 30%, according to Rick Kingery, food & beverage practice lead at Colliers, the commercial real estate consultancy. In May, Colliers released a report revealing that low vacancy rates and growing demand for cold storage facilities have pushed developers to build cold buildings on a speculative basis for the first time. “The opportunities for institutional investors are vast,” Kingery told Site Selection via email in August. “They can support a wide range of projects, from value-added properties to speculative. Additionally, they can provide equity for stabilized assets or forward investments on expiring leases. The price per square foot for cold storage facilities is significantly higher than for ambient storage, allowing institutional investors to deploy larger sums of capital more quickly. This diverse range of opportunities makes the space highly attractive for institutional investors.” In its survey, which Kingery co- authored, Colliers found that 21 spec cold storage buildings totaling 5.6 million sq. ft. have been built since 2021, with another 15 buildings totaling some 3.4 million sq. ft. currently under construction or about to begin. “These buildings,” the report states, “have been built by less than 20 developers that specialize in the product type, and feature ceiling clear heights 36’ to 50’, heavy S I T E S E L E C T I O N SEPTEMBER 2024 109 power requirements, wide internal temperature ranges and specialty reinforced floor slabs.” Karis Cold, based in Naples, Florida, is among the sector’s major players. It has cold storage projects underway in Chicago, Illinois; Denver, Colorado; Jacksonville, Florida; Suffolk, Virginia; and Rock Hill, South Carolina. Others in the space, says Kingery, include RL Cold, Sansone Group, Scout Logistics, Saxum and TI Cold. “I anticipate continued growth in the spec market,” Kingery says, “driven by an increasing sophistication among developers and a growing number of developers building across the USA. Additionally, more capital partners are entering the space. I expect 2025 to see even more construction starts compared to 2024.” TOP 10 STATES FOR LOGISTICS FACILITY PROJECTS JAN. 2019 – JULY 2024 STATE PROJECTS Texas 2,062 Illinois 1,267 Ohio 666 California 602 Georgia 557 Florida 396 Pennsylvania 337 North Carolina 313 Virginia 291 South Carolina 244 Source: Conway Projects Database INVES TMENT PROFILE: CONSUMERS ENERGY ‘Let’s Move Some Dirt’ Michigan takes another road to industrial site development. With speed to market an increasingly crucial consideration for global manufacturers, having a deep portfolio of ready industrial sites has gone from being a competitive advantage to a strategic imperative for states pursuing transformative economic development projects. Enter MI Sites. Michigan’s new site development program — spearheaded by the Michigan Economic Development Corporation (MEDC) — is helping to build out a roster of shovel-ready sites across the length and breadth of Michigan. e goal, in a state that overfl ows with assets, is to check that fi nal box for site selectors and their corporate clients. “We’re a diverse state with a lot of off erings,” says Paul O’Connell, MEDC’s vice president for real estate development. “We have a great manufacturing workforce, great infrastructure, great ports and a long history of making things. We’re looking to MI Sites to help put us over the top.” To develop MI Sites, MEDC partnered with Quest Site Solutions, a site consultancy based in Greenville, South Carolina, to establish granular protocols for identifying, evaluating and developing industrial sites in a manner that both leverages Michigan’s strengths and advances the state’s strategic goals. Electric vehicles, semiconductors and 110 SEPTEMBER 2024 S I T E S EL E C T I O N INVES TMENT PROFILE: CONSUMERS ENERGY ‘Let’s Move Some Dirt’ by GARY DAUGHTERS gary.daughters@siteselection.comadvanced manufacturing rest squarely within Michigan’s sweet spot. “MI Sites,” O’Connell explained to Site Selection, “creates consistent, statewide criteria tailored to the needs of those and other growth sectors,” including, he says, clean energy and the defense industry. “We want to make sure that the sites that we’re developing fi t exactly what those companies are looking for, so that we’re not doing one thing where they’re looking for something diff erent.” On the Same Page Now is year, MEDC announced the approval of $. million in grant funding through its Strategic Site Readiness Program (SSRP) to support sites across Michigan. Recipients include Hancock Business & Technology Park in the Upper Peninsula; Muskegon Heights Industrial Parks and Covenant Business Park in West Michigan; Flint Commerce Center in East Central Michigan; and Latson Innovation Interchange Technology & Industrial Park in Ann Arbor. “ ese grants will prepare us to win more manufacturing projects creating thousands of good jobs,” said Gov. Gretchen Whitmer. “Together with a strong, bipartisan economic development toolkit, we are competing with other states and nations to bring home supply chains of cars, chips and clean energy.” She added: “Let’s move some dirt!” MI Sites, says O’Connell, builds upon this broader, statewide framework. “Part of the SSRP funds were sent to economic developers to go out and identify sites in their market. After that,” he says, “the MI Sites program comes in and provides a professional review of those sites to establish exactly where they stand, further support them and get them ready to go for economic development.” In addition to the promise of additional grant funding, MI Sites, says O’Connell, includes innovative marketing support and an important consulting component. “We’re creating a process and building a structure around it,” he says, “to help our economic developers understand the steps that they need to go through to see that shovel-ready site to fruition.” Supersite in the Making e ,-acre Advanced Manufacturing District (AMD) of Genesee County — being developed near Flint by the Flint & Genesee Economic Alliance — stands out, says O’Connell, among Michigan’s top emerging industrial sites. is year, the project received a hefty $ million in state grants to purchase targeted land in the county’s Mundy Township. Being developed with high-tech manufacturing in mind, the site is envisioned by supporters as a lure to a multi-billion- dollar investment that could generate thousands of jobs, promote related expansion and pour untold millions into local coff ers. “We’re marketing the Advanced Manufacturing District to companies that will help bring our supply chain back to the United States and grow our local talent pipeline,” said Tyler Rossmaessler, executive director of the Flint & Genesee Economic Alliance. “ is will create opportunities for young people, including jobs that don’t require a college degree. Between these jobs and the economic boost this will give our small businesses, we are very excited for the impact this initiative will have on our region and the entire state.” In July, the Flint & Genesee Economic Alliance announced that AMD’s network of supporters has grown to include more than regional employers, community stakeholders and labor organizations. “ is site,” Rossmaessler said, “is among the best in the country. Every day,” he said, “we’re hearing from people who live and work in Genesee County about their excitement and optimism that an advanced manufacturing project can help to turn around our county and our region.” All this goes toward certifying that, when it comes to site development, Michigan is committed to expanding opportunities for both its people and potential investors. “ e bottom line,” says O’Connell, “is that Michigan is investing. We will continue to invest, we have a unifi ed standard and solid sites. And many more to come.” This Investment Profile was prepared under the auspices of Consumers Energy, Michigan’s top energy provider. For more information, contact Valerie Christofferson at Consumers Energy at valerie.christofferson@cmsenergy.com. S I T E S E L E C T I O N SEPTEMBER 2024 111 Photo: Getty Images We want to make sure that the sites that we’re developing fi t exactly what companies are looking for.” — Paul O’Connell, MEDC VP of Real Estate Development We want to Next >