- Amazon has signed a deal for its largest-ever warehouse in New York City.
- The e-commerce giant has rapidly assembled the largest portfolio of storage and distribution locations ever by a private company in the city.
- The warehouses serve as the backbone for Amazon's booming e-commerce business.
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Amazon just signed its largest lease ever in New York City — a deal to occupy a 1 million-square-foot warehouse that will be purpose-built for the e-commerce giant.
The deal is the latest in a dramatic expansion of the $1.3 trillion company's logistics operations in and around the city. Amazon has rapidly created the largest network of storage and distribution facilities ever assembled by a private company in the city.
"We are excited to increase our investment in the New York City area with a new delivery station that will provide fast and efficient deliveries and create hundreds of job opportunities for the talented local workforce," an Amazon spokeswoman said in a statement, confirming the huge lease.
The new space will be located at 55-15 Grand Ave., a former papermaking factory in Queens, New York, that will be razed and replaced with a multistory warehouse spanning about 1 million square feet that will feature rooftop parking for delivery vehicles.
Amazon's growing warehouse footprint serves as the backbone for the billions of dollars of food and goods it sells and delivers within increasingly quick shipping windows to shoppers in the metropolitan area, which is its largest e-commerce market.
Separately, Amazon is negotiating to lease a 620,000-square-foot office and warehouse space in Red Hook, Brooklyn, that is under construction, a source with direct knowledge of the negotiations told Business Insider. That lease, which has not been previously reported, has not yet been signed the person said. The Amazon spokeswoman did not immediately offer comment on that pending deal, but the company generally does not disclose new locations until it has signed on to take them.
Earlier this month, Business Insider reported that the tech and e-commerce firm just took a 200,000-square-foot warehouse in the South Bronx neighborhood of New York that had previously been lease by its onetime rival Jet.com.
In recent months, Amazon also committed to two warehouses just outside New York City in New Jersey, a roughly 315,000-square-foot warehouse at 1800 Lower Road in Linden and an 185,000-square-foot space in Avenel at 1 Paddock St.
At the start of the year, Amazon leased 450,000 square feet in Staten Island, New York, next door to a newly built 855,000-square-foot distribution center it leased in 2017.
The latest deal at 55-15 Grand Ave. will likely cost hundreds of millions of dollars to develop and will be built by a partnership between the New York City real-estate firm RXR Realty and the Los Angeles industrial landlord LBA Realty. The pair purchased the site two years ago for $72 million.
The new site is in Maspeth, an industrial area of Queens that is desirable to logistics and e-commerce tenants because it is near the geographic center point of the city, providing quick access to Brooklyn, Queens, Manhattan, and the Bronx for last-mile deliveries.
"You just saw it with the pandemic where you have a dense population that needs to be serviced and delivered to, and Amazon is filling that need," said Joseph Taylor, the president and CEO of the New Jersey industrial builder Matrix Development Group, which built Amazon's two warehouse spaces on Staten Island. "You're seeing it all over the country, but I would imagine that by the sheer volume of the business Amazon does in the city, it's a focus point."
Amazon's e-commerce business has boomed as Americans have increasingly turned to online shopping during the recent lockdowns that were instituted across the country to combat the spread of the pandemic. The industrial-real-estate market, meanwhile, has also surged, even as other property types, such as hotels, retail spaces, and office, face an uncertain future.
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