Micro-fulfillment development update

A planned MFC addition to a suburban Philadelphia Walmart Super Center. Warrington Twp, Bucks County, PA

PUBLIC NOTICE

This public notice provides insights into Walmart’s path to surpassing Amazon as the world’s #1 revenue-generating retailer.

Walmart moved into the top position by expanding it’s e-commerce operations and it’s extensive global store network.

Walmart’s fulfillment, pick-up and delivery center concepts in development– and the automation at the core of these e-commerce facilities– vary across the country. In this case, it’s a 5,000 square foot addition to an existing 150,000 square foot Super Center located on a busy commercial artery in Warrington Township, Bucks County, PA about 30 miles due north of Center City Philadelphia.

But the specific details of the e-commerce op-co component are only one piece of the story. On the propco side, the land use reality is that zoning doesn’t permit fulfilment and distribution uses in commercial and retail zoning districts as-of-right in most cities and municipalities. There is a lengthy, costly and very public approval process that real estate developers and corporations go through to make these projects happen.

Big-box fulfillment and distribution centers located on the outskirts of urban cores or in last mile industrial zoning districts are running at higher vacancy levels that at any point over the last 10 years in many markets across the country. How it got to this point would be better explored in a much longer form analysis another time.

Somewhere in there is a misallocation and miscalculation of exactly where and how much big-box fulfillment and distribution space is needed going forward. Much of the newer vintage, existing big-box fullfillment and distribution stock built to date is located in zoning districts that simply permitted these uses as of right. Land and obsolete buildings were available for redevelopment and developers urgently met rapidly increasing e-comm demand.

As Wal-mart is demonstrating with this project in one of the most desirable suburban markets of the 8th largest metro area and markets across the U.S., they will invest capital into automation and fulfilling e-commerce orders in smaller spaces as close to their customers as possible.