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Hillsborough optimistic about Amazon, despite statewide competition

The vacant lot near Interstate 75 and State Road 674 could be the site of an Amazon warehouse, bringing 1,000 jobs to Ruskin.

EDMUND D. FOUNTAIN | Times

The vacant lot near Interstate 75 and State Road 674 could be the site of an Amazon warehouse, bringing 1,000 jobs to Ruskin.

Amazon dropped big news last month when it announced plans to open distribution centers in Florida for shipping books, electronics and other consumer products.

The online retail giant said it would invest $300 million and create more than 3,000 jobs, many of them paying more than the state's average wage.

What Amazon didn't say was, "Where?''

Cities and counties across Florida were quick to extol the virtues of their communities. Enterprise Florida, a public-private economic development agency, got inquiries from every corner of the state, each wanting an Amazon facility.

Hillsborough officials are cautiously optimistic they've got a winning bid with a mix of incentives, ready-to-build space next to an interstate and a workforce looking for jobs.

"I'm optimistic Amazon is coming to Hillsborough County," County Commission Chairman Ken Hagan said. "In my conversations with our economic development folks and Amazon's representatives, I believe Amazon wants to be in Hillsborough County and will be in Hillsborough County."

Both Hillsborough and Polk counties have approved financial incentives to lure a warehouse to Ruskin and Lakeland, respectively. Jacksonville, Orlando and Winter Haven have also expressed interest.

Seattle-based Amazon isn't saying much about its plans but is working with Enterprise Florida and local jurisdictions to find the most suitable sites in terms of available real estate, workforce and accessibility to interstates. A decision on locations is expected around July 31, with construction to start in October.

"There are a lot of factors they are looking at,'' Enterprise Florida spokesman Sean Helton said. "We're working with them to find the perfect fit.''

The sheer size of Amazon's "fulfillment centers'' — 1 million square feet, about the size of the Tyrone Square Mall — limits the choices. Few sites can accommodate the building, let alone have space for trucks and employee parking.

"When you're building a 1-million-square-foot building, you don't say, 'Here's where I want to be,' " said Jan Boltres, managing director of industrial services for Colliers International Tampa Bay. "You say: 'This is the best available site that could accommodate us. These are our options.' "

Financial incentives, while important, aren't typically a deciding factor for large projects, he said. Companies often choose a location but don't disclose it until after the incentives are finalized to ensure they get some form of assistance.

Hillsborough commissioners okayed one of two incentives last month and are scheduled to consider the rest of the $6.4 million package Wednesday. This week, Polk County officials approved $4.5 million in property tax incentives over 10 years.

"That sounds like a lot of money, but when you start factoring in the cost of the building, the land and the employees, the number becomes lost in the rounding,'' Boltres said. "If it was $50 million, that would begin to affect their location analysis.''

More significant is being close to customers. Amazon currently has to ship orders to Florida from out of state, making it difficult to do next-day delivery or start grocery service. Creating a physical presence in Florida would require the retailer to start charging sales tax for local purchases.

Building a distribution center in central Florida makes sense over places like Jacksonville, particularly when it comes to reaching the large South Florida market, said Bill Eschenbaugh, a Tampa-based land broker. A truck driver could potentially deliver a load from Ruskin to Miami and back in one day.

If urgency is a factor, Eschenbaugh thinks Hillsborough has the edge in landing the first fulfillment center. The proposed Ruskin site at Interstate 75 and State Road 674 in the mostly vacant South Shore Corporate Park has the infrastructure in place for a new building.

Hillsborough County Economic Development Director Ron Barton notes that Amazon approached the county about the location, not the other way around.

"This company has spent a significant amount of time with us," Barton said, perhaps more than any he can recall in 30 years working in economic development. "It doesn't mean the deal is done. But it tells me this site, this community and this business proposal have merit to them."

Amazon hasn't said how many fulfillment centers it wants in Florida, but it would most likely be more than one, based on the employment and capital investment figures Amazon cited in its June announcement with Gov. Rick Scott. Proposals from Amazon say the Ruskin warehouse would cost about $200 million and employ 1,000 workers. The Lakeland center would cost $100 million and add 385 jobs.

It's also unclear whether Amazon would want distribution centers in neighboring counties, but it's quite possible.

Amazon's distribution centers likely will receive and ship goods using trucks, rather than rail, which is generally used for shipping vehicles and commodities. It also could get goods brought in on cargo ships and hauled by trucks to a fulfillment center.

Tampa Port Authority officials said the port is well-positioned to serve distribution centers in both Hillsborough and Polk counties. The port already receives cargo ship containers of furniture for Rooms To Go along I-4 and goods for Bealls department stores, based in Bradenton.

Experts agree an Amazon facility in central Florida would have far reaching benefits for the region, regardless of its specific location. Just the big household name would grab the attention of companies looking to build distribution centers.

"This is going to have regional impact,'' said Boltres of Colliers. "It's not that one county loses and one county wins.''

Susan Thurston can be reached at sthurston@tampabay.com or (813) 225-3110.

Hillsborough optimistic about Amazon, despite statewide competition 07/12/13 [Last modified: Friday, July 12, 2013 11:26pm]
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