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UPS plans major logistics hub in metro Atlanta

By Urvaksh Karkaria / www.bizjournals.com / November 8th, 2016

United Parcel Service Inc. (NYSE: UPS) is said to be planning what, one source said, could be one of the logistics giant’s biggest hubs in the country.

The facility would be at the Majestic Logistics Center, a 340-acre development near Charlie-Brown Airport about 10 miles west of downtown Atlanta. The expansion, codenamed Project Shark, could create more than 1,000 jobs.

The site design calls for 1,324 auto parking spaces, 1,064 trailer storage spaces, 57 retail auto spaces and 216 tractor service parking spaces, according to a building permit filed Tuesday.

“We are looking at the UPS large hubs around the country to define our approach to modernization and expansion,” UPS spokeswoman Susan Rosenberg said Tuesday. “We’ll communicate when we have large projects in the (Atlanta) area.”

UPS has announced a multi-year strategy to put new technology and systems into its hubs that help in the sorting and loading process.

This investment will help with “efficiency improvement, as well as maintaining reliability and delivery accuracy as our volume grows,” Rosenberg said.

The Atlanta hub would be similar to UPS’ mega hubs in Louisville and Ontario, a real estate source said Tuesday.

“They are building a hub that will be one of the largest hubs for UPS in the country,” the source said about the Atlanta facility. “(The project) just popped up on Friday [Nov. 4] and it’s massive.”

In Louisville, Ky., UPS has a 5.2 million-square-foot worldwide air hub — Worldport — that processes an average of 1.6 million packages daily. Worldport employs 20,000, making UPS is one of the largest employers in Louisville, and in Kentucky.

In 2015, UPS completed construction on a 416,000-square-foot air facility in Ontario, Calif., which handles urgent, next-day packages and features automated sorting capabilities. Earlier this year, UPS said it will expand that hub to 900,000 square feet.

UPS’ possible Atlanta expansion is fueled by the burgeoning growth of e-commerce as shoppers abandon brick-and-mortar stores for mobile phones and desktops. Freight carriers like UPS and FedEx benefit from that trend as they get to deliver product from warehouses to homes and businesses.

In October, UPS said it ordered 14 747-8 Freighters from Boeing(NYSE: BA), and has an option to another 14 of the cargo airplanes.

“These aircraft are a strategic investment for increased capacity for UPS customers around the globe,” said Brendan Canavan, president of UPS Airlines. “The 747-8 will allow UPS to upsize our network in both new and existing markets.”

Positioning hubs around the country makes sense in an age of instant gratification.

“Same day delivery is the holy grail of logistics and distribution today,” said John Boyd Jr,. a Princeton, N.J.-based corporate site consultant. “That is where UPS wants to be. A second Worldport would be consistent with that.”

Atlanta is an obvious choice for a major logistics hub because of its rail and road infrastructure and proximity to a major seaport. A UPS mega-hub would boost cargo volumes at Hartsfield-Jackson Atlanta International Airport, already the world’s busiest passenger airport.

A UPS mega hub would have economic development implications for metro Atlanta —helping recruit e-commerce companies, call centers and and light assembly shops that need to be in proximity. Shoe e-tailer Zappos, for instance, has a major presence at WorldPort, Boyd noted.

In March, California developer Majestic Realty Co. said it would invest $150 million and develop 3 million square feet of distribution and warehouse space at Majestic Logistics Center.

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