REAL ESTATE

Red Hook Last-Mile Facilities Raise Concerns

City Councilmember Carlos Menchaca and Red Hook (iStock, Getty)

Red Hook has seen an influx of big brands arriving on its shores in the past decade or so, including a massive Ikea store and one of the city’s few Tesla showrooms. A cruise terminal also opened there in 2006.

But plans to build several last-mile distribution centers have residents of the small waterfront neighborhood concerned about traffic and overbuilding, the Wall Street Journal reports.

“Industry is not something we are afraid of in Red Hook, but the last-mile delivery is a whole other issue,” City Councilmember Carlos Menchaca, who represents the neighborhood, told the publication. “There’s real terror about what could happen here.”

There are already plans to build several last-mile facilities in the area, including DH Property Holdings’ 350,000-square-foot facility, which is fully leased to Amazon, and UPS’s 1.2-million-square-foot facility on a 12-acre waterfront site. The Gindi, Chetrit and Nakash families have also formed a joint venture with Bridge Investment Group to develop a warehouse on a $45 million site on the outskirts of the neighborhood.

And Red Hook can’t prevent more distribution centers from coming to the area because its zoning allows delivery hubs to be constructed without special permits or environmental-impact studies.

Menchaca and other locals have petitioned the city to amend the neighborhood’s zoning. They are also requesting a comprehensive traffic study to determine the potential impact on the neighborhood, and calling for a moratorium on new last-mile warehouses.

Both Amazon and UPS told the Times that they are committed to be good neighbors and would mitigate the environmental impact of their facilities.

As more people opt to shop online, online retailers — along with real estate developers — are racing to build distribution facilities near large population centers so that they can deliver merchandise the next day, or even in a few hours. That’s led to a surge in demand for logistics real estate; the sector accounted for 20 percent of commercial real estate spending in 2020, according to a recent report. [NYT] — Akiko Matsuda

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