Madera County is preparing to join the e-commerce distribution revolution in the New Year. Industrial space has always been in short supply in Madera County, with much of the demand coming from value-added agricultural operations — food processing, container manufacturing, etc. But with two e-commerce operations in the works, Madera is preparing to join the ranks of Fresno and Visalia as fulfillment hubs in the Golden State.
That is welcome news for a county that is rapidly diversifying its traditional farm economy while also growing in ways not seen in other Central Valley locales. On both the commercial and residential sides, Madera County is primed for growth in 2022 despite challenges that include Covid-19, drought, clogged supply chains and more. “We are getting more activity and more views than ever in history,” said Bobby Kahn, executive director of the Madera County Economic Development Commission.
The first major e-commerce project in Madera County should be under construction by the middle of next year, Kahn said. Called “Project Sunset,” the distribution center would be located in a Chowchilla industrial park with access to Highway 99. Officials are still mum about which company will operate Project Sunset, which after two phases will consist of a 750,000-square-foot warehouse and 250 new jobs, Kahn said.
While Project Sunset is wrapping up its environmental review under the California Environmental Quality Act, a much more ambitious project in Madera County is just beginning the process. The proposed 3-million-square-foot Project Riverwood Fulfillment Center would be located on 122 acres near Avenue 7 and Highway 99, according to environmental review documents filed with the state. The facility would be five stories tall and house a 24-hour-a-day operation that would create up to 1,874 jobs.
The project is being developed by Seefried Industrial Properties, a well-known development partner for e-commerce clients that include Amazon. The tenant for Project Riverwood has not been revealed. The Madera County Planning Commission could begin hearings on the EIR as early as June 2022, according to published reports.
Kahn believes these projects represent an economic shift for the county that is being seen all across the US. According to new estimates from the US Census Bureau, Q3 retail e-commerce sales were $214.6 billion, up 6.6% from Q3 2020. By next year, analysts expect online retail sales to represent more than 15% of total retail sales. That figure was 5.3% a short ten years ago.
For Madera County, the addition of e-commerce fulfillment represents a change in the economic mix that was so dependent on agriculture — especially in the industrial space. “We are starting to see a pivot point with logistics companies, distribution centers, last-mile centers,” Kahn said.
The demand for industrial land remains strong in Madera County — a trend that was present well before Covid-19. In the last five years, industrial vacancies have hit below 1% in Madera County. Kahn estimates it is around 2% currently. “The industrial market in Madera County is as active and robust as I’ve ever seen it,” Kahn said.
Some investors smell an opportunity, especially when it comes to light industrial space. One such project is from WHSE Partners, which will break ground Nov. 30 on a 144,000 square-foot, light-industrial project a couple miles east of Highway 99 in Madera city limits.
The project is expected to be delivered by summer 2022 and will include 74 units of multi-tenant space with each unit just under 2,000 square feet. Kahn said possible tenants could include small-scale entrepreneurs and contractors that require a couple thousand square feet and a small yard. Multiple tenants mean healthier cash flow, which makes for a relatively safe investment, Kahn added.
The team behind WHSE Partners (it’s pronounced “warehouse”) includes Chief Operating Officer Erin Volpp and Founder and CEO Rob Boese. Boese also founded Fresno-based Boese Commercial in 2013. “WHSE Partners is excited to build and soon deliver a critical industrial component of Madera. The pro-business environment and central location of Madera make the city a dynamic partners in this project,” Boese said in a statement.
Another anticipated user of industrial as well as retail space is the budding cannabis market, which should makes its debut in the City of Madera next year. The Madera City Council is on the cusp of approving its cannabis-permitting ordinance, which would award up to six standard retail cannabis licenses and two social equity licenses, according to published reports.
In addition to retail, cultivation and warehousing for cannabis has site selectors kicking the tires on vacant spaces that have been on the market for some time, Kahn said. “It will add a whole other element to the economy,” Kahn said. Also in the vein of recreation, Madera County’s hotly anticipated casino by the North Fork Rancheria of Mono Indians is anticipated to break ground in Q1 of 2022, Kahn said.
The controversial project has been 18 years in the making, and has been litigated as far as the California Supreme Court. With an apparent green light, the long awaited groundbreaking near Highway 99 north of Madera can proceed, but in a modified way. Kahn said the project would likely be built in phases, with the first phase the construction of the casino to build cash flow, with a hotel and resort coming in a subsequent phase. All together it is expected to create 1,000 jobs. “It will have a definite impact on the local economy,” Kahn said.
Residential growth has also kept pace with industrial growth, with two major new cities — Tesoro Viejo and Riverstone — expected to add thousands of new households and surrounding, self-contained communities. Retail growth is also ongoing, with the revitalization of older shopping centers and vacant space — such as an old Mervyn’s location making way for the fast-growing Vallarta Supermarkets. Considering the hundreds of millions of dollars of investment taking root in Madera County, growth should be the name of the game for years to come.