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Demand for Industrial Space to Increase Thanks to E-commerce, New Distribution Intermodal Systems, Says Expert

ORLANDO, Fla. -- Demand for industrial space will increase by an estimated 250 million square feet in 2014 thanks largely to ecommerce expansion and new intermodal distribution systems, says an industrial development expert. There are and will be such new changes in this logistics sphere.

George Livingston, longtime real estate investment developer and broker and chairman of NAI Realvest in Orlando also said third-party logistics is playing a greater role in ecommerce and the industry sector was more profitable last year than other logistics service providers.

“Home Depot online sales increased fifty percent year over year for the past two quarters,” Livingston said.  That points to the ways sticks-and-bricks stores are reaching out to consumers with online gateways. The key is faster, more efficient delivery, Livingston said.   The cost of delivery is 50 percent of the cost of the logistics system.  

Experts estimate that ecommerce will create about 40 percent of the demand for new warehouse and distribution space in the region.

“Domestic intermodal traffic is growing two to three times faster than America’s Gross Domestic Product, or GDP,” Livingston said. “That indicates significant planning and execution on the part of store retailers to tame the online beast,” he said. “Quick delivery really matters.”

Intermodal deliveries offer a five to 20 percent price advantage over traditional long-haul trucking, Livingston said, and it will be used more and more to reduce costs, he explained.

More rail intermodal facilities are likely to be built, given their cost advantage.

Wide span cranes that increase intermodal efficiency are now part of the CSX Winter Haven facility and are examples of new technology being used to cut time and cost.