First Inland Port in SoCalFriday, July 4, 2003
Reprinted by permission of AJOT
An article by Michael Rosenfeld, February 2003
Development of a 700-acre intermodal logistics and distribution complex now underway by the Pasha Group will anchor the new Southern California Logistics Airport (SCLA), the region's first so called inland port in Victorville, California about 75 miles northeast of Los Angeles.
The city of Victorville in Southern California's high desert has teamed with a private land developer for an ambitious plan to redevelop the former George Air Force Base into a 5,000-plus-acre master planned center for air cargo, rail freight, warehouse and distribution, and manufacturing facilities. In all, the build-out is expected to cost $1.5 billion over the next decade, most of it privately funded, although tax revenues from the new airport businesses and city bonds will help pay for infrastructure improvements.
With 65% of all imported goods already transported by rail or truck along the heavily-traveled I-15 highway through Victorville to the eastern US, SCLA will benefit the regional transportation system by offering rail, ground and air freight distribution, according to Stirling Airports International, developer of the master planned project.
"Within 10 years Victorville will become a major hub, a secondary gateway to Los Angeles and San Francisco," predicted Dougall Agan, whose Orange County, California firm is leading development at SCLA.
The master planned development will relieve congestion at Southern California's main airport, two major seaports and freeway system. The combined ports of Los Angeles and Long Beach, the largest port complex in the US, handled 10.6 million TEUs in 2002. For its most recent reporting year, Los Angeles International Airport handled nearly 2 million tons of air cargo in 2001, with 2002 projections on track to equal or exceed this figure. Cargo growth at the seaports is expected to average six to eight percent through 2020 while air cargo is expected to grow 6.6% annually at Southern California airports in future years, straining existing infrastructure at these facilities.
Instead of flying into crowded Los Angeles International Airport, planners envision international cargo planes unloading shipments at SCLA in Victorville, where cargo would be redistributed to other parts of the country by rail and truck. Since 1999 SCLA has received more than 3,220 tons of air cargo, mostly from overseas. Moreover, imported automobiles would be unloaded from ships at Long Beach and Los Angeles ports and put directly onto rail cars to transport them to the distribution complex for preparation before delivering them to auto dealers.
Freeing up Valuable Space
A key component for the master planned SCLA will be the Southern California Logistics Rail Complex, a 1,200-acre facility currently under development, according to Stirling. A shared Burlington Northern Santa Fe Railway and Union Pacific Railroad rail line already passes by the site in Victorville.
"Combined with SCLA's transportation infrastructure and outstanding growth, we are seeing significant interest from world-class distribution companies like the Pasha Group," said Agan.
The Pasha Group's logistics and distribution complex is one of the solutions to the worsening distribution and supply chain congestion problems of the Southern California ports.
"We believe that population pressures in the Los Angeles basin will continue to draw industry to cities like Victorville," said Don McKnight, president, Automotive Services for The Pasha Group. "We fully expect the SCLA distribution complex to take on far greater economic significance and viability, not only for the Los Angeles basin's distribution requirements, but also for a much wider geographic area."
Container and automotive storage currently occupy an estimated 35 to 40% of the land at the ports of Long Beach and Los Angeles. Pasha's plans for a facility in Victorville will free valuable space at the ports, moving container and automotive processing and storage facilities to SCLA, allowing the ports to grow with the import industry's seven percent annual growth without significantly impacting the region.
The Pasha distribution complex will handle storage, maintenance and repair of containers, chassis and other transportation equipment, such as freight railcars and locomotives. The facility will provide intermodal services for container loading and unloading activities associated with freight station operations. Pasha also plans to operate warehousing, distribution and processing facilities that will serve auto manufacturers' requirements for consolidation of new vehicles and parts distribution.
Projections See Triple Current Air Cargo Activity
The SCLA faces stiff competition from two other Inland Empire communities where local officials are trying to redevelop closed military bases. At the former March Air Force Base in Moreno Valley, Riverside officials recently completed multi-million dollar road and runway improvements, hoping to land a cargo carrier. In San Bernardino at the closed Norton Air Force Base, officials are working to develop a distribution center.
These former military bases face their biggest challenge from Ontario International Airport in San Bernardino, already home to one of the largest hubs for United Parcel Service. Ontario officials have been seeking to attract other cargo carriers to the airport, which is operated by Los Angeles World Airports, operator of Los Angeles International Airport.
All these airports are basing their business plans on projections that air cargo handled by Southern California airports could triple to 9.5 million tons a year during the next two decades. Growing demand for cargo services is likely to shift first to Ontario, which is closer to seaports and more developed than the former military airports. But industry observers believe there will be a need for the other airports because even conservative projections have demand outstripping capacity at both Los Angeles and Ontario.
Victorville has been aggressively focused on setting itself apart from other airports, noting that two-thirds of all freight moving out of California, moves along the adjacent I-15 corridor. Land in Victorville is also cheaper - about a third less than in Ontario - and more large tracts are available. In addition, the SCLA has extended the airport's runways so it can handle the world's largest cargo planes.
"While we're looking relatively far out into the future, we believe the SCLA offers the best alternative for cargo logistics and distribution for our business," said Pasha's McKnight. "We see this project as a very positive step in the right direction for Southern California."