Volkswagen Launches Import Hub on Texas Gulf Coast

PRP and KDC are teaming up to develop the build-to-suit facility.

Volkswagen Group of America announces Port Freeport in Texas as new Gulf Coast hub for future operations

Port Freeport site. Image courtesy of Volkswagen Group of America

Volkswagen Group of America has commissioned a new Gulf Coast hub in Port Freeport, Texas, a facility that will accommodate the importation of 140,000 vehicles per year and will serve nearly 300 Volkswagen dealers in the U.S.

The project will be built in collaboration with real estate investment management company PRP, of Washington, D.C., and corporate development and investment firm KDC, of Dallas.

The facility is expected to break ground later this year and be operational in early 2024. Dollar values for the project and for Volkswagen’s 20-year lease on it were not disclosed.

Current Volkswagen Group of America port operations in Houston and Midlothian, Texas, will be consolidated into the new hub at Port Freeport.

Freeport is in Brazoria County, directly south of Houston, so roughly 30 miles southwest down the Gulf Coast from Galveston Bay. It’s part of the Houston-The Woodlands-Sugar Land MSA.

Developing Port Freeport will enable Volkswagen Group of America to import about 140,000 vehicles per year, primarily from its production hubs in Mexico, as well as from Europe.

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Roll-on/roll-off business at Port Freeport has been expanding, according to its website. In 2018, the port handled nearly 70,000 vehicles, a 40 percent increase from the previous year. An expansion now underway will add parking for about 4,000 vehicles.

In a prepared statement, Anu Goel, executive vice president, Group After Sales & Services, at Volkswagen Group of America, said the new hub at Port Freeport will allow the company to serve nearly one-third of its U.S. dealer network more efficiently and more sustainably.

Paul Dougherty, president of PRP, added that the asset complements PRP’s net lease portfolio of newer construction facilities leased by investment grade tenants on a long-term basis in strong U.S. logistics markets.

JLL assisted Volkswagen Group of America in the site selection process for a consolidated port facility along the Gulf of Mexico.

Corporate builder

As a corporate developer, KDC has produced about 33 million square feet valued at more than $9 billion, not just corporate offices, but also data center and broadcast studio build-to-suits. Its clients have included FedEx, J.P Morgan Chase, Liberty Mutual, Raytheon, State Farm and Toyota North America.

In July, KDC completed the second phase of the new, $150 million Dallas-area headquarters for Independent Financial. The 198,000-square-foot building in McKinney, Texas, is LEED Silver certified.

Just a couple of weeks earlier, KDC had announced the approval of rezoning of the site for its planned 1.6-million-square-foot office campus in Irving, Texas, in the Dallas–Fort Worth metro.

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