[caption id="attachment_99491" align="alignright" width="375"] Walls rise at the Lombard Crossing Industrial Park project in American Canyon on Sept. 17, 2014. (credit: Jerry Francis, Billet Transportation)[/caption]
AMERICAN CANYON -- In a sign of how much demand there is for storing wine and related supplies in south Napa Valley, two warehouses with 287,000 square feet in American Canyon are still a few months away from completion but already are substantially spoken for.
Yet even as the walls rise for the Lombard Crossing Industrial Park project in American Canyon, construction is getting underway for the 226,044-square-foot first building at the 19.4-acre Greenwood Business Park project in south Napa, and work is set to begin this month on the 646,000-square-foot first warehouse at the 218-acre Napa Logistics Park project in American Canyon.
Together with future phases of those projects set to seek building permits shortly and other projects poised to do so, southern Napa Valley could have upwards of 2 million square feet of new large wine warehouse space by this time next year.
Lack of wine storage and distribution space in southern Napa Valley in the past few years has been a problem for American Canyon-based Billet Transportation (707-649-9200), which is leasing 120,000 of one 136,000-square-foot Lombard Crossing building under construction.
"I have product in Woodland and Oakland because there was no room to put it around here," said Jerry Francis, founder, owner and president of Billet. Started as a side business in 1997 to pay for his car-racing hobby, Billet had its first warehouse, with 40,000 square feet, built in 1999. In recent years, the company expanded by leasing 28,000 square feet in Woodland, 20,000 square feet in Oakland and still needed to lease more temporary space.
"We wanted to build this building five or six years ago, but it was a bad time," Mr. Francis said. That was 2009, and sales of North Coast wine slowed dramatically, as did spending on new oak barrels for fermentation and packaging supplies such as bottling. A significant part of Billet's business is storage of empty bottles and barrels arriving from plants elsewhere, which the company then moves to customers when needed. But in the past five years, Billet's revenue has grow 17 percent--19 percent annually.
In the new building, 92,000 square feet of Billet's space will be chilled to 55 degrees for cases of wine, and 44,000 square feet will be humidity-controlled for storage of empty barrels.
The space also will have 30 truck doors, which likely will all be in use during peak periods, Mr. Francis said. The 47-employee company's fleet of 22 trucks moves casegoods from wineries to its own facility or third-party location, barrels and glass to vintners, and wine to trade accounts as far as Southern California. Billet also consolidates winery casegoods for cross-country transportation.
Filling out the rest of the 136,000-square-foot Lombard Crossing warehouse -- about 20,000 square feet -- will be Vin-Go (707-251-8012, vin-go.net), also based in American Canyon. The company started in 2009 as a wine-focused affiliate of We Ship Express, a New York-based premium products fulfillment provider. It retooled a year later from mainly direct-to-consumer wine order compliance and fulfillment to now more consolidation of shipments, over-the-road transportation, forward staging of wine closer to consumers nationwide and "last-mile" order fulfillment.
Building on We Ship Express' East Coast warehouse network for forward staging, Vin-Go now also can forward-stage shipments and fulfill orders from warehouses in Reno, Oklahoma and Illinois, as well as American Canyon, according to Edmund Delaney, Vin-Go CEO. The company is working toward inspecting wine returns at the staging locations and preparing OK bottles for resale, rather than a common practice of having them go back to the winery.
In the past year, the company has built a truck fleet of 12 temperature-controlled rigs to allow deliveries year-round.
The 150,000-square-foot second Lombard Crossing warehouse has an undisclosed company in advanced talks to lease about 120,000 square feet of it, according to Steve Brock, real estate agent for Stravinski Development Group, co-developer of the project with Hess Development.
After Napa-based Biagi Bros. Transportation & Warehousing took over Zephyr Express' lease for 101,000 square feet at 770 Skyway Ct. in Americn Canyon, Napa Valley's vacancy rate for wine warehousing fell to about 2 percent, according to Cushman & Wakefield's Glen Dowling, who helped broker the deal. He's worried that if Orchard Partners/Divco breaks ground on the 646,000-square-foot warehouse, the valley could have about 1.8 million square feet of new and available wine warehouse space in the first half of next year.
"That's a tremendous amount of space for Napa," said Mr. Dowling, who also is marketing other warehouse projects set to break ground.
Yet the largest project has more of a regional draw and appeals to companies that aren't wine-related, said Colliers International's Brooks Pedder, who is marketing Greenwood Business Park and Napa Logistics Park.
"We see numerous leases in Solano (County) that will make the Napa market that much tighter," he said.
