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April 29, 2019

Spurred by e-commerce, Bradley Airport sees spike, significant growth potential in freight business

Photo | Contributed
Photo | Contributed
Photo | Contributed
Photo | HBJ File
Photo | Contributed UPS started shipping out of Bradley Airport in 1987 and moved from an airplane hangar to its current UPS Bradley Air Hub facility in 1997.

The freight industry is taking off at Bradley International Airport.

Package-delivery and other supply-chain companies operating out of Bradley handled 281 million pounds of freight and mail shipped in and out of the airport last year, a 16.4-percent increase vs. 2017, according to Kevin Dillon, executive director of the Connecticut Airport Authority, which oversees Bradley.

Those companies include shipping giants FedEx, UPS and DHL, as well as smaller businesses and airliners that carry cargo for shipping in addition to transporting passengers. Last July, Pinnacle Logistics, which ships packages for Amazon, began operating in 394,000 square feet of space at the airport, contributing to the spike in cargo handled by freight companies.

That also helped pad Bradley's bottom line. The airport, which receives rental and landing fees from freight carriers operating on its grounds, recorded $9.2 million in cargo-related revenue last calendar year.

By comparison, it earned only $2.9 million in fiscal 2017, which ran from July 1, 2016 to June 30, 2017.

The growth in the freight and logistics industries — including trucking and warehousing — at and near Bradley dovetails with the continued rise of e-commerce, which relies on planes, trucks and other modes of transportation to move online-purchased goods from the manufacturer and/or retailer to the end customer.

U.S. Census data show U.S. e-commerce sales totaled $132.8 billion in 2018's fourth quarter, nearly twice the amount spent during the same period five years earlier.

“I see a real opportunity for us to grow freight handling on a regional basis,” Dillon said.

Dillon said he attributes much of the 2018 boost in freight at Bradley to Pinnacle — which employs about 200 people at the airport — and he's expecting an even larger increase in 2019, since last year's numbers only reflect about five months of Pinnacle's operations there.

Dallas-based Pinnacle Logistics moved to Windsor Locks after closing its warehouse operation at the Quonset Business Park and T.F. Green Airport in Rhode Island. The company has kept a low profile since starting its local operations here and declined to comment for this story.

But Dillon said he thinks Pinnacle relocated to Bradley because it's the better option logistically, as the airport is geographically central to New England, and has access to Interstates 84 and 91, which T.F. Green lacks.

In its five-year lease with Pinnacle, the Airport Authority waived all fees in the first year, but will charge just over $1.2 million in rent for building and ramp space in year two. Those fees rise slightly to as high as $1.3 million.

The so-called Bradley Airport Development Zone, which encompasses the towns of East Granby, Suffield, Windsor and Windsor Locks, has also benefited from the rise in e-commerce as more logistics companies and online retailers want to be closer to the airport, as well as major highways near it.

Businesses that set up shop within that zone are eligible for tax breaks if they acquire an idle facility, or construct or renovate one, and use it for specific purposes like warehousing and motor freight distribution, according to the Bradley Development League.

Several distribution hubs have popped up in the development zone over the years, including Amazon's fulfillment center, which opened in Windsor in 2015. Windsor also landed drugstore chain Walgreens' 700,000-square-foot, $175 million distribution center in 2009 and Dollar Tree's 1-million-square-foot distribution center in 2013.

Meantime, long before the e-commerce boom, UPS started shipping out of Bradley in 1987 and moved from an airplane hangar to its current UPS Bradley Air Hub facility in 1997. It employs 325 workers who handle about 60,000 inbound and outbound packages per day, a UPS spokesperson said.

“Freight and small package volume are both areas of tremendous growth for UPS,” said Paul Lussier, district air manager for UPS. “For businesses of all sizes, Bradley plays a role in connecting the Northeast region to the rest of the U.S. and the world.”

And Dillon says Bradley is in a unique position for significant future growth in cargo shipping.

The airport owns 300 acres of undeveloped property — most with airfield access — on which existing tenants or new ones could build shipment facilities and hangars, Dillon said. Bradley's available space and lower rents, he added, set it apart from transportation hubs like Logan International Airport in Boston and John F. Kennedy International Airport in New York.

“I think as cargo continues to grow throughout the entire Northeast region, we represent an opportunity for cargo companies to relocate operations to (Bradley),” just as Pinnacle did, Dillon said.

Logistics jobs

The four-town Bradley Airport Development Zone is also in a unique position to become a key locus of ground freight in the Northeast, said Joe Sculley, president of the Motor Transport Association of Connecticut (MTAC), which represents companies in the state's trucking industry. In addition to its proximity to the airport, its unique geographic position puts it nearby major highways, making the area a great hub for trucking, which moves 94 percent of all freight in Connecticut.

The advent of companies like Amazon and others placing warehouses to meet demands for next-day or even same-day delivery is also adjusting truckers' jobs, Sculley said. Thirty or 40 years ago, almost all trucking consisted of long-haul, cross-country routes.

Now, more routes are closer to the end customer or final destination, requiring truckers to fulfill that critical “last-mile” haul.

“Now because of e-commerce and the way retailers are set up, it's become more localized, or regionalized, so the trucking routes are shorter,” Sculley said. “If you can tell [drivers] that they can be home at night, that's a big plus.”

Tim Lescalleet, senior vice president of Griffin Industrial Realty Inc. in Windsor, a prominent commercial landlord and developer in the area, said the trend of companies opening warehouses in the Bradley development zone has been going on for a while.

A driving force in locating there is the ability to serve all of New England, as well as upstate New York and arguably parts of northern Pennsylvania, Lescalleet said.

“I think there's still room for growth … . Older New England (companies) are in the process of changing their distribution patterns, which typically involves consolidation of multiple facilities,” Lescalleet said. “From the other end, you've got a need for the last mile component around metropolitan areas, which is driving demand for smaller distribution spaces.”

Jobs in the freight industry have also grown around Bradley in the past decade, said Windsor Economic Development Director Jim Burke. He said just over 700 town residents worked in the transportation and warehousing industry in 2007. That shot up five-fold to more than 3,500 a decade later.

“Freight going through (Bradley) keeps increasing, and so will the warehousing and storage right there,” Burke said. “That's going to mean more jobs for people in those towns.”

Amazon's 1.2 million-square-foot Windsor fulfillment center employs nearly 1,500 full-time workers, Amazon spokesperson Rachael Lighty said. Employees earn between $15 and $19.20 per hour, plus benefits, like health, dental and continuing-education incentives, she said.

In addition to e-commerce, Dillon says Connecticut's proximity to a number of manufacturers presents another growth opportunity.

Manufacturers in the Northeast should look to Bradley, Dillon said, since they can truck their freight to the airport and ship it domestically and internationally.

“We are geographically blessed to be in the heart of New England with a good highway transportation system to bring cargo into Bradley, and then to truck it throughout the entire region,” Dillon said.

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