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Amazon warehouse began as speculative project; warehousing demand high in Missoula

Amazon Truck
Posted at 3:28 PM, Dec 22, 2022

MISSOULA - A week after Amazon announced its plans to open a new fulfillment center in Missoula, the firm that brokered the deal said the company wasn't the only business looking to lease space in the facility.

And that, in simple terms, was why construction of the 72,000-square-foot warehouse had no name attached to the project until recently.

“During permitting, Amazon wasn't the only business considering leasing space in the warehouse on Cartage Road, said Claire Matten with Sterling CRE in Missoula. “The warehouse was a speculative project, which means there were no signed leases with Amazon or any other company during the permitting and planning phases.”

The new delivery station will receive orders from larger Amazon facilities across the country and dispatch delivery vans to bring those orders to Montana customers. The new facility, which will employ around 100 people, will complete the “last mile” of the Amazon shipping process.

In recent years, Sterling and the Missoula Economic Partnership, among other economic leaders, have said Missoula's lack of industrial space and warehousing could soon serve as an inhibitor for economic growth and job creation.

Missoula County has largely filled its two Targeted Economic Development Districts at the airport and the old Bonner mill, and it has looked to the Wye to create new investment opportunities.

Matten said the speculative construction of the Cartage Road warehouse leased by Amazon shows a continuing need for such projects in Missoula.

“With such limited warehousing and distribution space on the market, spec builds, like the facility on Cartage Road where Amazon landed, are showing strong lease-up before they even break ground,” Matten said. “Instead of a few tenants leasing individual spaces at the speculative industrial building in Missoula, Amazon elected to lease the entire facility.”

Back in 2017, cities across the county attempted to vie for Amazon's proposed HQ2 project and the estimated $5 billion community investment that would come with it. But the project required a metro population of 1 million people and at least 8 million square feet of existing office space — factors that quickly eliminated Missoula and all of Montana from any chance of landing the project.

But interest in warehousing and distribution remains an area that Missoula could improve to attract new jobs and investment. Interest in such facilities remains high, said Kara Hogan, also with Sterling.

“There was interest from distributors, manufacturers, marijuana growers, and other businesses,” Hogan said of the Cartage Road projects. “That demonstrated to us that demand for industrial space is still high.”