Amazon to open distribution center at southern end of Sonoma Valley in 2020

After 18 months sitting vacant, the expansive new warehouse space at the base of Eighth Street East - dubbed Victory Station - will welcome a new tenant in 2020: Amazon.

The cavernous 250,000-square-foot space on 19 acres at 22810 Eighth St. E. will be used by Amazon, Inc. as a delivery station, or what is known in e-commerce as a “last mile warehouse.” Delivery stations are the final stop before an Amazon order heads out for delivery to a customer’s door.

While a new Amazon distribution center could potentially create several hundred new jobs in the North Bay, it could also add hundreds of vehicle trips a day to an already heavily trafficked chokepoint area.

Staffing levels and the number of drivers who would fan out from the property onto Valley roads has not yet been determined, according to Victory Station owner Jose McNeill, but he was quick to counter the belief that the delivery station would necessarily mean a net increase in the number of delivery vans in the Valley.

“Currently Amazon’s delivery people for our area driving up from Richmond to make deliveries here so it’s not a net addition in terms of drivers on the road,” he said. He noted also that there is no customer interaction point planned for the location.

But the choice of tenant for the project has been criticized by Schellville neighborhood watchdogs Norman Gilroy, of Mobilize Sonoma, and Kathy Pons, of the Valley of the Moon Alliance, who voiced their concerns in a May 2 letter to Tennis Wick, director of Permit Sonoma.

The letter seeks assurances that the Amazon use would not “exceed the scale of uses on which the [project’s] original permit approvals were predicated.” The property is zoned M3, for light manufacturing, research and development, warehousing and distribution or retail/office use, but until Amazon arrived on the scene, McNeill expected a wine industry tenant for the temperature-controlled space, a tenant that would have brought less traffic to the busy Arnold Drive and Highway 121 intersection.

Wick told the Index-Tribune, however, that Amazon’s tenancy is within the realm of the allowed used permit.

First District Supervisor Susan Gorin on Monday voiced concern that Amazon could potentially generate more traffic on an already congested roadway.

She said that she recently prioritized the installation of a traffic signal at the Arnold Drive and Highway 121 intersection, even before the tenant and use was known.

“Traffic queues up consistently at this intersection and almost a decade ago former Supervisor Valerie Brown listed the installation of the traffic signal on a work plan, and upon investigation, for some unknown reason, the installation of the signal fell off the workplan,” she said, adding that she placed it back on a few months ago.

“But I fear this potential use may increase that congestion before the signal is installed,” she said. “I’m trying to ramp [the signal] up in priority for installation.”

The potential impact of the large beige building in Schellville has loomed large since construction began in 2018. Victory Station is one of the largest warehouse buildings to be constructed in Sonoma County in the past decade and was, until recently, the largest single tenant option available in the county.

McNeill bought the property for $4 million in 2016 from local developer Rick Deringer, who had purchased the land from previous owner Ed Ferro. McNeill broke ground in late 2017 and the project was completed in 12 months.

The parties involved in the Amazon agreement didn’t disclose the terms of the lease; in 2019, the space was listed at $10.20 a square foot per year. At more than 250,000 square feet, Amazon would be paying a rent north of $2.5 million a year if the company paid the 2019 listing price. Cushman & Wakefield was the local listing broker, while Jones Lang LaSalle (JLL) represented Amazon and its interests.

The building is located near the intersection of Highways 121 and 12, around eight miles from both Highway 37 and 29. The property is adjacent to Northwestern Pacific Railroad tracks across from the old Schellville Station. “The spot, midway between Petaluma and Napa, is unbeatable,” said McNeill in 2019.

Amazon, which now operates its own freighters and cargo planes, currently delivers 2.5 billion packages a year and the company has expressed plans to end its relationships with FedEx and UPS, and to control as much of its own shipping as possible.

According to Amazon’s corporate website, the e-commerce giant has 110 fulfillment centers across the U.S., including 19 in California, more than any other state. The closest one to Sonoma is in Vacaville and, according to the Amazon website, the new Sonoma distribution center would be the company’s first in the North Bay.

“We are constantly exploring new locations and weighing a variety of factors when deciding where to develop sites to best serve customers, however, we don’t provide information on our future roadmap,” Amazon spokesperson Brittany Parmley told the Index-Tribune.

According to paperwork filed for a similar “last mile” center in Sturtevant, Wisconsin, the daily routine for the Sonoma facility could be as follows: Large trucks drop off packages overnight to the Sonoma distribution center, employees load packages into delivery vans before late morning the following day. Midday delivery vans leave the facility to deliver products to homes. Another wave of drivers drop by in the late afternoon to pick up more packages for delivery. The delivery vans return in the evening, and the whole process would start again for the next day’s deliveries.

Amazon has seen its business surge during the COVID-19 pandemic, with revenue up more than 26 percent, to $75.5 billion in the first quarter of 2020.

McNeill described the road to securing a tenant for his property as a long journey.

“It’s an overnight success that took four years, but I think it’s going to be a great asset for the county and the town of Sonoma.”

Highway 121 neighbor Jordan Kivelstadt is poised to open Kivelstadt Wine Bar and Eatery a few doors down from the planned facility.

“The Victory Station project has been vacant for years, and this brings a major employer and new employment opportunities to the Valley,” he said. “We’re excited to have hundreds of new potential customers down the road!”

Amazon’s Sonoma facility is expected to open in the fall, in time for the holiday season.

See a tour of a delivery station similar to what is expected to open in Sonoma below.

Email Lorna at lorna.sheridan@sonomanews.com.