Avenue 31 says the development has the potential to alleviate logistical headaches for e-commerce retailers by giving them a direct connection to major rail and road arteries.
When Amazon Canada dropped the bombshell last week that it was shutting down all seven of its warehouses in Quebec, Ryan Semple was quick to take notice.Semple, the director of business development for Ottawa-based real estate firm Avenue 31 Capital, is well aware of Eastern Ontario’s growing importance as an e-commerce logistics hotbed.The potential to land a big tenant like Amazon is one of the reasons Avenue 31 purchased 680 acres of prime industrial development land in Long Sault, a community in the township of South Stormont a little over an hour’s drive southeast of Ottawa.Located a few kilometres west of Cornwall and just north of the St. Lawrence River, the property is bordered by the Canadian National Railway line to the south and Highway 401 to the north. For companies looking to set up warehouses and shuttle goods quickly to metropolitan areas like Toronto and Montreal, Semple figures it doesn’t get much better than that. And for Avenue 31, which wants to build up to five million square feet of logistics infrastructure and storage space at the Long Sault site, clients like Amazon are exactly what the company is looking for.Avenue 31's project in Long Sault would be located along Highway 401 and a main CN Rail line.“It would be an excellent location for them to take a land position if they want to move products and service all of Quebec,” Semple says of the e-commerce giant. “Our site has that type of capacity.”Long Sault would be the first in what Avenue 31 hopes will eventually become a series of “inland ports” along class-one railroad sites across Canada. In 2021, the firm embarked on a long-term plan to develop and operate inland port and rail facilities that would include warehouses and other infrastructure coveted by online retailers like Amazon, which rely on a network of distribution hubs across North America to quickly get merchandise into the hands of consumers.According to a leasing brochure for the Long Sault project, the company’s mission is to “become the preferred way for global companies to move their goods throughout North America in the safest, most efficient, and sustainable manner possible.” Avenue 31 says it is “building a team of rail specialists to compliment Avenue 31’s real estate development expertise and establish the requisite skill set to design, build, and operate inland ports along class 1 railroads.” Semple says the market will ultimately dictate whether more such facilities are built in other parts of the country.
Busy development pipeline
Founded in 2016, Avenue 31 quickly made a name for itself in the National Capital Region’s development sector. The firm is currently in the midst of building out what will eventually be more than a million square feet of industrial space near the corner of Highway 417 and Hunt Club Road, a development that’s already attracted blue-chip tenants such as FedEx, Pizza Pizza and Red Bull.But Semple says Avenue 31 is just getting started. It’s about to launch another project across from Amazon’s warehouse on Boundary Road, and it also owns land across from the e-commerce behemoth’s biggest local fulfilment centre in Barrhaven. Meanwhile, Avenue 31 is also branching out into residential development with a plan to build more than 900 housing units in partnership with Montreal-based Cogir Real Estate on a four-acre parcel of LeBreton Flats owned by the National Capital Commission.But the total square footage of all those developments put together wouldn’t match the Long Sault project, which has been dubbed "Camino," the Spanish word for "the way." Noting that 20 million people live within a five-hour drive of the Camino site, Avenue 31 says the development has the potential to ease logistical headaches for e-commerce retailers by giving them a direct connection to major rail and road arteries. “Congestion at North American seaports has created supply chain bottlenecks resulting in costs and delays impacting major shippers, carriers and logistics firms and their clients,” the company says. “Distribution by rail can alleviate these capacity issues.”Avenue 31 has consulted with CN Rail to create a site that’s tailored to the railway’s specific needs. The company says it could dedicate up to 130 acres to rail-related activities, depending on the type of cars and level of service users require.Avenue 31 is now in talks with a "major North American-wide rail service provider" to build out the yard. The developer is aiming to have the first buildings at Long Sault ready for occupancy by 2027, and Semple is confident there will be tenants lined up to fill them.In fact, he says, Avenue 31 already came close to landing its first big customer for the site. A year ago, the company bid on the chance to build a new distribution centre for Michelin, but the tire manufacturing giant ultimately chose to go with Broccolini’s proposal for a 980,000-square-foot facility in Cornwall.“It’s a very, very exciting project,” Semple says of the Long Sault development. “There are a lot of opportunities. It just depends on how large a building (tenants) want and where the market is.”
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