Amazon recently announced it will locate a 3.4 million-square-foot, five-story distribution center in Cottage Grove, Wisconsin, a small village east of Madison. The $200-millon facility will sit on nearly 150 acres and create up to 1,500 jobs.
According to Jason Field, CEO of the Madison Region Economic Partnership (MadREP), adding 1,500 warehousing jobs to the area could create an additional 1,650 indirect jobs and roughly $77 million in earnings. The facility will be the largest distribution center in Wisconsin, strategically located to serve the two largest cities in the state, Milwaukee and Madison.
Trammel Crow, the developer on the project, worked with Alliant Energy for months. This new facility will include electric vehicle and truck charging. It will be one of the first distribution centers in Wisconsin to incorporate electric truck charging.
“This is a great win for the village of Cottage Grove, MadREP, the state of Wisconsin and Alliant Energy,” said JP Brummond, vice president of customer and community engagement at Alliant Energy. “The future of electric vehicles and renewable energy is bright, and we look forward to a strong partnership with Amazon as we work together on this incredible project.”
The facility will be one of the largest facilities in Amazon’s real estate portfolio. According to Warehouse Automation Canada, Amazon is involved in nine of the 10 largest industrial facilities currently under construction in the U.S. This facility will also mark the third Amazon facility to come to the Madison area since 2020. Amazon currently has distribution centers in Madison, Beloit, Oak Creek and Kenosha.
(Rendering of the planned 93-foot-tall, 3.4 million-square-foot distribution and warehouse facility.)
This investment represents an ongoing shift from brick-and-mortar to online shopping. Area Development predicted new opportunities in e-commerce and greater developments in small and mid-sized markets two years ago. Matt Powers, executive vice president of retail and e-commerce at Jones Lang LaSalle Incorporated, cited two specific reasons:
- Competition for warehouse workers and stronger competition for labor in larger markets.
- The significant demand for fast shipping.
The global shutdown due to coronavirus also forced many consumers to change their shopping habits. In the U.S., online shopping increased by 30 percent in the first six months of 2020 compared to the same period in 2019. This surge put pressure on retailers like Amazon to bolster their distribution network. E-commerce retailers now invest in hub market locations to access the last mile of distribution and develop warehouse space across primary and secondary logistic markets, like Madison.