DHL Supply Chain, the world’s leading contract logistics provider, has revealed plans to develop a new warehouse facility totaling 1 million square feet in Lebanon, Pa. The company will invest $88 million in the property, which will ultimately consist of two buildings, to help a specific large-scale customer enhance logistics in the Northeast U.S.
The initial building to sprout up at the Lebanon site will encompass 970,000 square feet of space that will be utilized for warehousing as well as manufacturing and distribution purposes. DHL isn’t prepared to disclose all the specifics of the project; however, Lebanon County land records indicate that the global 3PL acquired an approximately 110-acre site at 3000 State Drive in Lebanon Township in early June 2021 for $12 million.
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DHL had been laying the groundwork for the development well in advance of completing the site purchase. In March of this year, Liberty Environmental Inc.—after having been contracted by DHL and Lotus Land, the property’s owner at the time—submitted a remediation investigation report and cleanup plan for the site, which had been home to aluminum manufacturer Alcoa.
The Real Estate Solutions team of DHL will guide the new logistics project. Construction of the first building is on schedule to commence in early August. Work on the second building will get underway as dictated by the customer’s requirements.
There’s a great future in warehousing
DHL’s expansion in Lebanon is a timely endeavor. “The key to success for 3PLs will remain the same: more relationships, more flexibility, and more paths to placing the best loads in the best lanes,” according to Kearney’s 2021 Annual State of Logistics report.
In addition, e-commerce’s expansion and fluctuating inventory demonstrate the strategic importance of 3PLs’ warehousing functions, Kearney said, pointing to statistics from Technavio indicating that the $65 billion 3PL warehouse segment is projected to increase to $84 billion in 2024.
DHL appears to be ahead of the curve. The third-party logistics provider has been in growth mode for some time, focusing on more relationships and more square footage. New endeavors over the last 12 months include a 10-year agreement with a Siemens Healthineers Customer Service Material Logistics unit calling for DHL to provide service logistics support and to allow Siemens Healthineers to lease 260,000 square feet of a newly acquired, 422,000-square-foot, DHL distribution and warehouse facility in Memphis.
More recently, in late June 2021, DHL expanded its partnership with Advanced Drainage Systems. The company will now provide ADS with transport and logistics suite services to facilitate warehousing, fleet and e-commerce solutions. Additionally, the partners will build on a previous program by co-investing in two warehouses to support ADS’s retail business. The 131,000-square-foot property in Greer, S.C., and the 356,000-square-foot property in Middletown, Ohio, will both operate under the direction of DHL.